NSW Crime Commission Warns of Possible Pokies-Related Money Laundering Following Covid-19 Crisis

The New South Wales (NSW) Crime Commission has shared its concern that the country’s economy could turn into a desired destination for money laundering associated with international criminals who may have been attracted by the successful way the Australian Government has been managing the coronavirus crisis.

The state’s Crime Commission explained that its fears have risen because, according to new figures, the profits generated by the poker machines operating in NSW in 2020’s final months increased in comparison to the ones from the year before. The growth in the electronic terminals’ profits has fuelled concerns that the machines, which are also known as “pokies”, could be exploited as laundromats for international criminals’ money.

The state’s gambling regulatory body – the Liquor and Gaming NSW – revealed that the profits generated by the local poker machines rose by 1.8% and 6.5% in November and December 2020 in comparison to the same period a year earlier, reaching AU$582.7 million and AU$629.6 million, respectively. The overall profits of the NSW gaming machines from July to December 2020 amounted to AU$4.4 billion, with the figure representing an increase from the AU$4 billion generated in the second half of 2019.

Currently, there are about 96,000 pokies across 4,000 venues in the state of New South Wales, with 1,500 of them being hosted at the Star Casino in Sydney. The local regulator revealed that the limitations in trading imposed on clubs and pubs because of the Covid-19 crisis did not have a negative effect on the poker machines’ profit increase in 2020.

Poker Machines Associated with Illegal Money Laundering Practices

Victor Dominello, the Customer Service Minister of the NSW, has been pursuing a gambling card to help problem gamblers while at the same time is seeking a way to tackle money laundering in the state. Under his proposal, only cashless transactions would be accepted by pokies, so gamblers would be required to register and pre-load money to the card.

According to some campaigners, such as the former ClubsNSW anti-money laundering compliance auditor Troy Stolz, funds generated by illegal activities were one of the major drivers of poker machine turnover. Campaigners have claimed that pokies have been used by criminals to launder some “drug money” so they could circulate that money in the economy without any problems. According to Mr Stolz, one of the biggest problems was that it was hard for the authorities to find out exactly what part of the money going through the electronic gaming machines was generated from illegal activities because most gambling venues failed to meet their responsibilities.

Experts have found that poker machines in the state of NSW have been particularly attractive to criminals and criminal organisations because the betting stakes they offer are significantly higher than the ones of other states. They said pokies can be used as laundromats for illicit funds that criminals could deposit in the machines, and then, after a short period of gambling, withdraw the balance from the pokies legitimately.

In its recently published full-year report, the NSW Crime Commission revealed that clubs, pubs and casino closures in the first few months of 2020 reduced the money-laundering opportunities. However, the Commission projected there would be another increase in the movement of illegal funds during the recovery period after the coronavirus pandemic. This is exactly why it warned of crime-related risks for the country as a result of Australia’s economic attractiveness, including one of the gambling sector.

  • Author
Daniel Williams

Daniel Williams

Daniel Williams has started his writing career as a freelance author at a local paper media. After working there for a couple of years and writing on various topics, he found his interest for the gambling industry.
Daniel Williams
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