Federal Court Fines the Star Entertainment Group 260 Million Dollars

The Federal Court on Wednesday ordered The Star Entertainment Group to pay a $260 million fine for historical money laundering violations that occurred across its Sydney and Queensland casino operations.

Justice Cameron Moore determined the penalty after the financial intelligence agency AUSTRAC initiated legal action in 2022, alleging the company prioritized profits over mandatory anti-money laundering and counter-terrorism financing controls.

The fine, which is to be paid in four equal installments over 19 months, arrives as the company attempts to recover from years of regulatory scrutiny and license suspensions.

“In effect, Star put profit over compliance and did so on a large scale,” said Justice Cameron Moore in his ruling.

AUSTRAC had sought a $400 million penalty, while The Star previously warned the court that any fine exceeding $100 million could force the company into liquidation.

“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,” said Brendan Thomas, the chief executive of AUSTRAC.

Justice Moore noted that the penalty would have been higher if not for the company’s ongoing remediation efforts and previous fines paid for overlapping conduct.

While Justice Moore stated in court that Star would likely need to raise capital to cover the fine, the company’s chairman, Soo Kim, offered a different assessment following the judgment.

“We are fortunate to be in a financial circumstance that’s quite a bit different than even 12 months ago,” said Soo Kim, the chairman of The Star Entertainment Group.

Kim said the company expects to pay the installments using cash on hand and positive cash flow from its venues, rather than requiring additional financing or share sales.

The United Workers Union expressed concern regarding the impact of the penalty on the company's workforce.

“Accountability must not come at the expense of thousands of workers who had no part in those failures,” said Pat O’Donnell, a director at the United Workers Union.

The Star’s shares entered a trading halt ahead of the announcement and are expected to resume trading on Friday as management prepares a formal response to the court's decision.