Star Entertainment Fined $260 Million Over Serious Money Laundering Failures

Australian casino operator The Star Entertainment Group has been ordered to pay A$260 million for widespread historical breaches of anti-money laundering laws, adding further financial pressure to a company already struggling with regulatory penalties and questions over its future.

The Federal Court imposed the penalty on Wednesday, with Justice Cameron Moore ruling that Star’s repeated compliance failures warranted a substantial fine, despite concerns about the company’s ability to remain financially viable.

The decision follows legal proceedings launched in 2022 by Australia’s financial intelligence agency, AUSTRAC, over serious deficiencies in the casino operator’s anti-money laundering and counter-terrorism financing controls.

Court Rejects Star’s Request for a Lower Penalty

The Star Entertainment Group had warned that a financial penalty exceeding A$100 million could push the business into liquidation.

However, Justice Moore concluded that the company’s proposed A$100 million fine would not adequately reflect the seriousness of its misconduct.

At the same time, he rejected AUSTRAC’s request for a A$400 million penalty, determining that the regulator’s proposed amount was excessive given Star’s financial circumstances and previous sanctions.

“The contraventions are serious, and a significant penalty is warranted”, Justice Moore said.

The judge emphasised that the penalty needed to discourage Star and other gambling operators from prioritising commercial profits over their legal obligations.

He also acknowledged that Star’s financial position was precarious and that the company would likely need to raise additional capital to meet the payment.

The final penalty was reduced to reflect the significant compliance improvements already being implemented by Star, as well as fines previously imposed for misconduct that substantially overlapped with the Federal Court proceedings.

Of the total A260 million penalty, A195 million relates to Star’s Sydney operations, while A$65 million is attributed to Queensland.

The company has been ordered to pay the amount in four instalments over 19 months.

Casino Allowed High-Risk Customers to Move Hundreds of Millions

The Federal Court proceedings exposed serious weaknesses in Star’s handling of customers and gambling junkets associated with potential criminal activity.

AUSTRAC alleged that the operator failed to properly manage money laundering risks connected to its dealings with Asian gambling junket Suncity and its financial backer.

Despite becoming aware of reports linking these parties to criminal activity, Star continued its commercial relationships with them.

The court also heard evidence that an individual with known criminal associations had channelled hundreds of millions of dollars through the casino.

Justice Moore found that facilitating overseas money transfers and failing to adequately scrutinise customers presenting money laundering or terrorism financing risks had become a significant part of Star’s business operations.

He described the company’s conduct as “egregious”, making clear that the violations were neither isolated incidents nor minor administrative failures.

“They were not mere oversights from time to time,” Justice Moore said.

The judge also compared Star’s misconduct with previous anti-money laundering cases involving Australian casino operators Crown and SkyCity, while acknowledging important differences between the proceedings.

He noted that Star’s breaches extended across multiple provisions of the relevant legislation and were so extensive that the total number of contraventions could not reasonably be calculated.

As a result, the theoretical maximum financial penalty was also effectively incalculable.

Star’s Previous Penalties Add to Financial Pressure

The A$260 million fine is the latest development in a series of regulatory investigations and enforcement actions involving Star Entertainment.

In June, the company’s former chief executive and former lawyer were collectively fined more than A$1.1 million for breaches of the Corporations Act.

The two former executives were also disqualified from holding corporate office for six and seven years, respectively.

Star has faced sustained financial difficulties following regulatory investigations into its casino operations.

In April 2025, US gaming company Bally’s Corporation and the Mathieson family provided a A$300 million rescue package, helping the casino operator avoid administration.

Despite that financial support, the latest court penalty has renewed concerns about whether Star can meet its obligations without further investment or borrowing.

The company’s shares were placed in a trading halt earlier on Wednesday ahead of the Federal Court’s decision.

AUSTRAC Condemns Star for Putting Profits Ahead of Compliance

Following the ruling, AUSTRAC welcomed the penalty, describing it as an important addition to previous enforcement action taken against Star by state and federal regulators.

The agency noted that the fine follows other substantial penalties and regulatory measures arising from casino inquiries in New South Wales and Queensland.

AUSTRAC chief executive Brendan Thomas said the decision reflected the seriousness of Star’s breaches while providing a further deterrent against similar misconduct.

“The Court found The Star did not simply fail to complete the right checks. It allowed high-risk customers to gamble without properly establishing where their money came from and put profit over compliance on a large scale,” Thomas said.

He stressed that Australian businesses must meet their obligations to prevent financial crime, regardless of the potential commercial consequences.

“AUSTRAC will not tolerate companies putting profit over their obligations to the Australian community,” he added.

Thomas also criticised Star’s handling of junket operators, saying the company continued granting access to private gaming facilities despite recognising suspicious activity and the risks associated with those relationships.

According to AUSTRAC, the operator’s inadequate monitoring systems made it impossible to establish the full amount of money that potentially high-risk customers had moved through its casinos.

“Due to The Star’s admitted deficiencies in monitoring, we cannot know how much money high-risk customers pumped through its casinos,” Thomas said.

He added that Star had exposed both its own operations and Australia’s wider financial system to substantial risks by failing to take appropriate action.

Questions Remain Over Star Entertainment’s Financial Future

The size of the penalty has raised fresh concerns about Star Entertainment’s ability to continue operating without further financial assistance.

Helen Bird, a corporate governance expert at Swinburne University, said attention would now shift to whether the casino group could afford the A$260 million payment.

“The size of the fine has raised concerns that the company might not be able to pay it and will enter administration,” Bird said.

“If that is to be the case, we can expect an announcement of that very quickly.”