NSW crime body calls for cashless gaming in pubs and clubs in AML crackdown

The New South Wales Crime Commission (NSWW) said the state’s pubs and clubs should adopt cashless gaming to put a stop to criminals funnelling billions in “dirty” cash through poker machines. 

The NSWCC recommendation was one of eight proposals for reform that follow an extensive investigation to crack down on money laundering through electronic gaming machines in pubs and clubs.

NSW Crime Commissioner Michael Barnes said poker machines offered criminals one of the last remaining safe havens where cash from criminal enterprises could be “cleaned” or gambled with virtual impunity. 

“At the moment serious offenders can enter NSW pubs and clubs, sit down next to patrons in gaming rooms, and openly feed large sums of cash from their crimes into poker machines with no real fear of detection. 

“The lack of traceable data collected by EGMs means the exact scale of this criminal activity is impossible to determine but it is clear from our investigations it involves many billions of dollars every year. 

“These basic reforms will help exclude vast sums of dirty cash that are primarily the proceeds of drug dealing. I’m sure venues won’t argue they should keep receiving that,” Barnes said.

Approximately $95 billion in cash flows through poker machines in pubs and clubs in NSW each year, making it the gambling capital of Australia.

Australia’s gambling industry has been in the regulatory cross hairs since an investigative media report into Crown Resorts in 2019 accused it of serious compliance breaches including money laundering. The documentary triggered a series of regulatory probes, which spread to rival Star Entertainment.

Pubs and clubs enter spotlight 

At the end of last year, NSW gaming investigator David Byrne said the activities had not been restricted to the country’s casinos and money laundering in pubs and clubs, the backbone of the industry in Australia, had also become widespread. 

The inquiry examined two forms of money laundering – that which seeks to use EGMs to load, “clean” and then withdraw cash to hide its origin and that which involves criminals using the “dirty” cash to gamble.

The inquiry found that the “cleaning” of the proceeds of crime is not widespread in clubs and pubs as processing vast sums of cash is inefficient compared to other avenues for laundering. However, large sums of the proceeds of crime are being gambled by criminals in pubs and clubs across the state, rewarding and perpetuating crime in the community. 

The report also identified an apparent lack of awareness by club boards, hoteliers and their staff of their anti-money laundering responsibilities which it recommended also needs to be addressed with improved legislation and regulations.

 Commissioner Barnes said: “It is a deeply concerning peculiarity that in the largely cashless digital economy in which we live that gambling in NSW pubs and clubs remains a $95 billion a year information black hole. Clearly, that cannot be allowed to continue.” 

Join us: 14 – 18 November 2022 MALTA

One of the first European countries to regulate the gaming sector, Malta is a hub of global business. The island is an obvious choice for SiGMA’s presence in Europe and a strong foundation for the field’s future. With a plethora of prospects for both investors and entrepreneurs looking to shape the future of this multi-billion-dollar business, Malta Week will bring together industry giants among the affiliates, operators, and suppliers of the gaming sector.