Australia’s financial crime watchdog, the Australian Transaction Reports and Analysis Centre (AUSTRAC), has ordered bet365 to strengthen its anti-money laundering (AML) and counter-terrorism financing (CTF) controls after a compliance review spanning almost four years found several shortcomings in the operator’s risk management systems.
The latest enforcement action concludes a regulatory process that began in November 2022, when AUSTRAC directed bet365’s Australian business, Hillside (Australia New Media) Pty Ltd, to appoint an independent external auditor. At the time, the regulator said it had reasonable grounds to suspect the company may not have fully complied with ongoing customer due diligence requirements and AML programme obligations under Australia’s AML/CTF Act.
Almost a four-year-long inquiry
The investigation, however, was not just focused on bet365. The action against platform was part of AUSTRAC’s broader supervisory campaign targeting Australia’s largest online bookmakers. After opening an investigation into Entain in September 2022, the regulator also ordered Sportsbet and bet365 to undergo independent AML audits, citing reasonable grounds to suspect breaches of their anti-money laundering obligations.
The external audit, carried out throughout 2022 and 2023, assessed whether bet365 had adequate risk-based systems to identify, monitor, and manage money-laundering risks. After reviewing the auditor’s findings alongside its own supervisory work, AUSTRAC announced a formal enforcement investigation in March 2024.
Rather than proceeding directly to court, the investigation has now resulted in bet365 entering into a legally binding enforceable undertaking, requiring the bookmaker to make substantial improvements to its compliance framework.
Under the agreement, bet365 must introduce a more robust, continuous risk assessment process, supported by clearer methodologies and governance procedures. The operator is also required to strengthen its identification of suspicious activity and ensure that suspicious matter reports are submitted more effectively as financial crime risks evolve.
Fixing the AML risk
Brendan Thomas, Chief Executive Officer (CEO) of AUSTRAC, said effective risk assessments and timely reporting remain fundamental to protecting Australia’s financial system. “Gambling businesses pose an inherent money laundering risk, and we are focusing on the risks to the Australian economy from money laundering through this sector,” Thomas said.
He added that the gambling industry processes large volumes of money at high speed, often through digital channels, creating opportunities for criminals to exploit weaknesses if operators fail to keep their controls up to date.
According to AUSTRAC, the enforceable undertaking establishes the minimum compliance standards bet365 must now maintain. Because the agreement is legally binding, any future failure to meet those obligations could expose the company to civil penalties under both the undertaking and Australia’s AML legislation.
Also, these expectations are not limited to bet365. The regulator said the commitments outlined in the enforceable undertaking reflect the minimum AML standards it expects every reporting business to meet as financial crime risks continue to change. The move is part of AUSTRAC’s broader focus on Australia’s gambling sector. It is already taking Entain Group to the Federal Court over alleged AML failings, while Sportsbet has also faced regulatory action in recent years.
All in all, all gambling operators are expected to regularly review and strengthen their customer due diligence, risk assessment and transaction monitoring processes to reduce the risk of their platforms being used for money laundering or other financial crimes.
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