The Federal Court has ordered The Star Entertainment Group to pay a $260 million penalty for serious breaches of Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) laws. Justice Cameron Moore handed down the penalty on Wednesday 28 October in civil proceedings brought by AUSTRAC in 2022 against two Star subsidiaries.
The penalty
Justice Moore ordered $195 million to be paid by Star Sydney and $65 million by Star Queensland, along with AUSTRAC’s costs. The penalty is payable in four instalments of $65 million, the first due by 25 November 2026 and the last by May 2028, Business News Australia reported.
AUSTRAC had sought $400 million payable within 28 days. The Star argued for no more than $100 million and said it could not pay more. The ABC reported the judge found $100 million too low and $400 million too high. “The contraventions are serious, and a significant penalty is warranted,” he said.
According to Business News Australia, Justice Moore said that, apart from one case involving a $50,000 penalty, the proceeding appears to be the first involving a disputed penalty under the AML/CTF Act. Earlier penalties, including $1.3 billion for Westpac and $450 million for Crown Melbourne, were agreed.
What the court found
The court found The Star failed to maintain a compliant AML/CTF program and failed to monitor customers to manage money laundering and terrorism financing risks, AUSTRAC said. Star Sydney breached ongoing customer due diligence requirements on 1,190 occasions and Star Queensland on 327 occasions, Business News Australia reported. The Star had made admissions that, in the judge’s words, “substantially resolve liability”.
“[A] significant part of Star’s business was dependent upon turning a blind eye to customers who presented a high ML/TF risk,” Justice Moore said. He also noted The Star had already received penalties of $200 million for conduct that “significantly overlaps” with this case.
“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,” AUSTRAC chief executive Brendan Thomas said.
The Star’s response
In an ASX announcement on 29 October, The Star said it accepts the penalty and does not consider that paying it in instalments will affect its ability to continue as a going concern. The penalty is a review event under its US$390 million facility with WhiteHawk Capital Partners, but the company said it is “confident that the facility will remain available”.
“Given that the current ownership and management team had nothing to do with the actions that gave rise to the proceedings, we commend the work of AUSTRAC and the Federal Court,” chairman Soo Kim said.
The lesson for reporting entities
The case shows courts will weigh a business’s capacity to pay, but will not let that reduce a penalty to a cost of doing business. With AML/CTF obligations now extending to lawyers, accountants and real estate agents, the judgment is a reminder that a compliant program must be applied in practice, not just written down.
Sources: AUSTRAC media release (28 October 2026); ABC News (28 October 2026); Business News Australia (29 October 2026).
This article is general information only and is not legal advice. Readers should seek advice specific to their circumstances.