Australian regulator begins civil lawsuit against Star Entertainment

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 Australian regulator begins civil lawsuit against Star Entertainment
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(Adds AUSTRAC's statement)


Nov 30 (Reuters) - Australia's Star Entertainment Group said on Wednesday the country's financial crimes regulator has begun a civil lawsuit against its units, alleging non-compliance with anti-money laundering and counter-terrorism financing laws.

The Australian Transaction Reports and Analysis Centre (AUSTRAC) will commence civil penalty proceedings against two of Star's units, The Star Pty Ltd and The Star Entertainment Qld Ltd. AUSTRAC, which said the compliance issues were "serious and systemic," did not specify a penalty or damages amount it was seeking in the lawsuit.

Australia's casino sector has faced intense scrutiny over the last three years after Star's larger rival Crown Resorts — recently bought by Blackstone Inc — was found unfit to hold gambling licences due to inadequate compliance with anti-money laundering laws, prompting some states to launch probes.

The regulator on Wednesday alleged that the Star units did not appropriately assess the money laundering and terrorism financing risks the business faced, and did not have a transaction monitoring program to identify suspicious activity.

"The Star entities also failed to carry out appropriate ongoing customer due diligence which has led to widespread and serious non-compliance over a number of years," said AUSTRAC Chief Executive Nicole Rose.

Star's CEO Robbie Cooke said the company was transforming its culture and business, and there was a "lot still to do."

Star's shares have dropped nearly 30% in a year marked with investigations of its operations over its alleged failure to prevent money laundering and criminal activity. (Reporting by Tejaswi Marthi and Harshita Swaminathan in Bengaluru; Editing by Krishna Chandra Eluri and Uttaresh.V)

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