An 86-page report looking at allegations of money laundering via electronic gaming machines (EGMs) in the Australian state of New South Wales says “billions” of Australian dollars may be involved, and recommends that the government there should mandate cashless play as a way to curb it.
The New South Wales Crime Commission said in a press release that a 12-month, multi-agency probe with the name ‘Project Islington’, found “criminals were funnelling billions of dollars of ‘dirty’ cash through poker machines in pubs and clubs” every year in that state, but there were “no effective controls or data collection to identify or prosecute those involved”.
The state’s gaming sector has been under particular scrutiny recently, with The Star Entertainment Group Ltd’s licence for its flagship Star Sydney casino being suspended “indefinitely” from October 21, and the property being placed under state-government supervision, following a separate inquiry that found multiple failures in its anti-money laundering practices in high-stakes gambling.
The report into gaming machines recommended “mandatory” cashless gaming, suggesting it would “minimise money laundering associated with EGMs by removing anonymity and increasing traceability of EGM-related transactions”.
The paper published on Wednesday, added: “This will enable law enforcement to identify and respond to money laundering and will improve data analytics around gambling and money laundering.”
The report said “few” known criminals were using slot machines for systematic money laundering, but some were conducting incidental money laundering, by using proceeds of crime for leisure betting.
The inquiry found “compelling evidence” that drug dealers were gambling on a large scale via EGMs “with the money obtained by their offending”.
The report added: “They were not seeking to disguise or ‘wash’ the origin of the cash but, instead, were using the cash proceeds of their crimes to gamble,” an offence under the state’s Crimes Act.
The inquiry had sought information regarding what it termed ‘high rollers’ from 23 different clubs, representing 54 licensed venues, across New South Wales, for a 12‐month period from April 1 2021, to March 31 this year.
The press release said approximately AUD95 billion (US$61.6 billion) in legitimate and illegitimate cash flowed through slot machines in pubs and clubs in New South Wales each year, making it the “gambling capital of Australia”.
The report said during the period of the study, about 86,700 machines were active in that market.
Australia-listed slot machine maker Aristocrat Leisure Ltd is currently running a trial in New South Wales on a new digital wallet for gaming, with player-safeguard and player-oversight capabilities.
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