AUSTRAC Defends AU$260 Million Penalty Against Star Entertainment
Australia.- 3 November 2026 | www.zonadeazar.com Brendan Thomas, Chief Executive Officer of AUSTRAC, Australia’s anti-money laundering and counter-terrorism financing regulator, has challenged Star Entertainment Group’s arguments concerning the financial consequences of a substantial regulatory penalty.
Thomas said he never found the company’s claim convincing that a fine exceeding AU$100 million would force it into insolvency.
His comments follow the Federal Court of Australia’s decision to impose a AU$260 million penalty (approximately US$183 million) on Star Entertainment for serious breaches of anti-money laundering legislation.
AUSTRAC Challenges Star’s Financial Arguments
In comments reported on 2 November 2026, Thomas expressed satisfaction with the outcome of proceedings initiated in 2022.
The executive said AUSTRAC had never accepted Star Entertainment’s position that it could not survive a penalty exceeding AU$100 million.
“We never bought the argument that Star ran that the fine was going to send them broke. I think that that’s been proven to be right,” Thomas stated.
However, he acknowledged that assessing the company’s financial circumstances remained a matter for the Court.
AU$260 Million Federal Court Penalty
On 28 October 2026, Australia’s Federal Court ordered Star Entertainment to pay a total penalty of AU$260 million.
The ruling established:
- AU$195 million: penalty relating to The Star Sydney.
- AU$65 million: penalty relating to The Star Gold Coast.
- AU$260 million: total financial penalty.
- Four instalments: payments spread over 19 months.
The amount falls between the AU$100 million proposed by Star and the AU$400 million originally sought by AUSTRAC.
Justice Cameron Moore considered both the seriousness of the breaches and the operator’s current financial position.
Serious Anti-Money Laundering Failures
The legal proceedings examined failures involving Star’s anti-money laundering and counter-terrorism financing systems.
The identified deficiencies included:
- Inadequate controls concerning high-risk customers.
- Failures to verify the source of funds.
- Insufficient monitoring of suspicious transactions.
- Inadequate oversight of VIP intermediaries, commonly known as junkets.
- Weaknesses in internal regulatory compliance procedures.
According to AUSTRAC, Star allowed high-risk customers to gamble without implementing appropriate measures to identify and manage potential illicit activity.
Brendan Thomas Describes Corporate Disaster
The AUSTRAC CEO described the consequences of the case as a corporate disaster for Star Entertainment.
Thomas recalled that the proceedings lasted four years and coincided with a significant financial and governance crisis.
During that period, the company experienced a substantial decline in share value, management changes and several regulatory investigations.
The executive suggested that the events had probably caused irreparable reputational damage to some of the individuals involved.
At the same time, he acknowledged signs that Star was gradually recovering from its financial difficulties.
Crown Resorts Also Faced Major Penalty
Thomas compared the case with regulatory action involving Crown Resorts, another major Australian casino operator.
In 2023, Crown agreed to pay AU$450 million following breaches of anti-money laundering legislation.
AUSTRAC considers both proceedings significant precedents for casino sector supervision.
Both companies have since undergone changes in ownership structures and senior management teams.
The regulator believes these developments have contributed to improvements in industry compliance.
Decline of Traditional Junket Operations
Another issue highlighted by Thomas was the transformation of the VIP intermediary business, commonly known as junkets.
For years, these operators played a significant role in attracting high-value customers, particularly from Asian markets.
However, regulatory reforms, investigations and the collapse of several businesses have substantially reduced their presence in Australia.
Thomas noted that large sums of money previously channelled through these arrangements no longer enter Australian casinos in the same way.
AUSTRAC regards this reduction as an improvement in managing financial crime risks.
AUSTRAC’s Broader Anti-Money Laundering Strategy
The Australian regulator views its enforcement actions against Star and Crown as part of a broader strategy to restrict illicit financial activity.
Thomas explained that when authorities close particular financial channels, criminal organisations must search for alternatives.
The regulatory objective is to reduce the available opportunities and make money laundering more difficult.
This requires stronger customer identification, transaction monitoring and controls over high-risk activities.
Thomas acknowledged that criminals continue seeking alternative methods of moving funds, making ongoing supervision necessary.
Star Entertainment Works Towards Recovery
The penalty comes as Star Entertainment attempts to stabilise its financial position.
The company has faced significant difficulties in recent years, including operating losses, regulatory restrictions and changes to its corporate structure.
Following the ruling, Star confirmed that it would accept the penalty and did not expect the payments to prevent it from continuing operations.
The four-instalment schedule will allow the financial obligation to be distributed over 19 months.
The company is also maintaining discussions with lenders concerning access to financing.
Industry Impact and Next Steps
The Star Entertainment ruling represents a significant recent example of anti-money laundering enforcement within Australia’s casino industry.
For AUSTRAC, the penalty demonstrates the importance of substantial financial consequences for serious compliance failures.
For Star, the challenge will be meeting its payment obligations while continuing its financial recovery under strengthened regulatory supervision.
With a AU$260 million penalty against Star Entertainment and a previous AU$450 million settlement involving Crown Resorts, Australia continues strengthening casino oversight and addressing money laundering risks associated with high-value gambling activity.
Star’s compliance with the payment schedule and its financial performance will remain important developments in the coming months.
Edited by: @fonta
