Gambling Companies in Australia Benefit from Proceeds from Crime

In recent years, gambling companies have been pocketing the proceeds of crimes committed by people who develop gambling addictions, argues Stephanie Convery in an article she wrote for The Guardian. The victims of these crimes confirm that the system designed to regulate these situations is failing.

Crime-Funded Gambling

In September 2022, Gavin Fine, a former Sydney financial adviser, pleaded guilty to multiple counts of fraud in the District Court of New South Wales. Fine lost more than $8 million on sports bets, and much of the money belonged to his clients and friends. The victims of these robberies never got their money back. Fine will be sentenced in January. Millions of innocent Australians have been hurt by the destruction of a gambling addict… I accept my punishment but cannot assume that annihilation continues.

In 2021, a 48-year-old Tasmanian woman was sued for stealing $940,221 from the vet clinic where she worked. She also has amassed $24,218 in debt on a credit card obtained illegally. The woman was diagnosed with a gambling addiction and spent most of her money playing Heart of Vegas, a social casino game from Aristocrat Leisure, Australia’s leading poker machine manufacturer. She played this game through Facebook, taking 30% off every transaction he made. The 48-year-old woman has been convicted of 26 counts of fraud and has been issued writs of indemnity to pay back the companies she stole, even though was already deep in the fund.

Both companies, Aristocrat and Facebook, kept the money, Convery argues. In 2018, another 27-year-old Tasman, who worked as an assistant financial accountant, was convicted on various counts of fraud after stealing $292,955 from his employer and others. The man alleged in court that he stole the money from his gambling addiction. He deposited the funds into his Sportsbet account but lost everything. He was sentenced to prison and to pay reparations, even though he was already heavily in debt.

Restitution Orders Are “Empty Promises”

Michael O’Connell, a former Victims’ Rights Commissioner in South Australia, called restitution orders issued to people convicted of gambling fraud “empty promises”. He added that even if a person partially manages to pay off outstanding debts and compensation, the amount does not reflect the money lost and damage suffered by victims. Lauren Levin, Director of Policy and Campaigns at Financial Counseling Australia, commented that the current legislative and regulatory system also fails people with gambling disorders. No one chooses to have an addiction, and people with gambling problems never thought they would commit such crimes. States and local territories must regulate gambling businesses.

You must also investigate the sources of client wealth. The Australian Transaction Reporting and Analysis Centre, AUSTRAC, is responsible for investigating companies that fail to comply with applicable laws.

Due Diligence on High-Risk Customers

According to Peter Soros, Austrac’s Deputy Executive Director for Regulatory Strategy, gaming companies do not conduct additional due diligence on their high-risk customers. On the other hand, Levin noted that if a young finance professional on a salary places thousands of dollars worth of bets over several months, it could be a red flag for big gambling companies to become suspicious. It would act on behalf of victims to recover money from gambling companies. She said if gambling operators are profiting from criminally funded gambling, then the applicable laws need to be changed.