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Australia’s financial crime regulator is charging Crown Resorts with money laundering

The logo of Australian casino giant Crown Resorts Ltd decorates the hotel and casino complex in Melbourne, Australia June 13, 2017. REUTERS/Jason Reed/File Photo

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SYDNEY (Reuters) – Australia’s financial crime regulator on Tuesday filed a wide-ranging civil lawsuit against casino operator Crown Resorts Ltd.

The Australian Transaction Reports and Analysis Center (AUSTRAC) said the company, founded by billionaire James Packer, failed to live up to its commitments and left its business and the country’s financial system “vulnerable to criminal exploitation”.

AUSTRAC’s investigation found “poor governance, risk management and failure to have and maintain a compliant AML/CTF program that details how Crown would identify, mitigate and manage the risk of its products and services being misused for money laundering or terrorist financing.” the Watchdog’s CEO, Nicole Rose said in a statement.

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Crown (CWN.AX) “also failed to conduct adequate ongoing customer due diligence, including with some very high-risk customers. This led to widespread and serious violations over several years,” Rose added.

AUSTRAC has not released its complaint against Crown, but a federal court database showed that a lawsuit was filed by AUSTRAC against Crown on Tuesday.

Crown said it is reviewing AUSTRAC’s complaint but has developed a comprehensive mediation plan and revised its governance since allegations of lack of due diligence surfaced during a 2020 regulatory investigation.

AUSTRAC began its investigation into Crown in October 2020 during the first of three grueling regulatory investigations into Crown’s governance, one for each city that has a casino.

The investigations led Sydney authorities to suspend the company’s gaming license – before it had opened a new resort there – while Melbourne authorities placed Crown under government oversight.

A third investigation in Perth has yet to report its findings.

The company has since replaced most of its board and management, and recommended shareholders – including billionaire founder and 37% owner James Packer – are backing a $6.3 billion acquisition by private equity giant Blackstone Inc (BX .N). Continue reading

A Blackstone representative declined to comment.

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reporting by Byron Kaye; Edited by Leslie Adler and Sam Holmes

Our standards: The Thomson Reuters Trust Principles.

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