Australia’s Federal Court has ordered The Star Entertainment Group to pay A$260 million (US$183 million) for serious breaches of anti-money laundering and counter-terrorism financing (AML/CTF) laws.
Justice Cameron Moore handed down the ruling on October 28, 2026, finding widespread compliance failures across the casino operator’s Sydney and Queensland businesses.
The penalty includes A$195 million for The Star Sydney and A$65 million for The Star Gold Coast. Both amounts will be paid in four installments over 19 months.
The decision follows years of regulatory investigations, financial difficulties and changes in ownership at one of Australia’s largest casino operators.
Australia’s financial intelligence regulator, AUSTRAC, launched civil penalty proceedings against Star in November 2022.
The regulator sought A$400 million in penalties, while Star argued that an amount exceeding A$100 million could force the company into liquidation.
Justice Moore rejected both proposals, determining that a substantial financial penalty was necessary while also considering the operator’s financial condition.
The court acknowledged that Star had already faced A$200 million in state regulatory penalties for overlapping conduct, alongside casino license suspensions and external management arrangements.
Moore also considered the company’s ongoing compliance improvements, including introducing mandatory carded play at its Sydney casino.
The final A$260 million penalty reflects those circumstances while seeking to deter similar breaches.
The Federal Court found that Star failed to maintain an adequate AML/CTF program and properly monitor customers who presented elevated financial crime risks.
According to AUSTRAC, the operator allowed more than 1,200 customers to gamble through high-risk channels without sufficient controls.
The failures included inadequate source-of-funds checks, insufficient customer due diligence and poor monitoring of suspicious transactions.
Star also permitted junket operators to use private gaming rooms despite concerns about their activities.
AUSTRAC’s proceedings examined the company’s relationship with Asian gambling junket Suncity and its funder, including allegations that Star continued dealing with them after becoming aware of reports linking them to criminal activity.
Justice Moore described the misconduct as “egregious” and said the breaches were not isolated administrative errors.
The court found that Star’s failures reduced authorities’ ability to trace potentially illicit funds and investigate financial crime.
The scale of Star’s dealings with high-risk customers was a significant part of the court’s assessment.
According to AUSTRAC, Star calculated that these customers generated approximately A$1.33 billion in revenue between November 2016 and November 2022.
Revenue from junket operations exceeded A$1.4 billion, while junket profits surpassed A$100 million in the years before the COVID-19 pandemic.
These figures do not establish how much revenue came directly from unlawful transactions. However, the court considered them relevant to understanding the financial incentives associated with inadequate compliance controls.
AUSTRAC CEO Brendan Thomas said Star had allowed customers presenting significant risks to gamble without adequately establishing the origins of their funds.
The regulator also highlighted failures involving third-party deposits, cash transactions and customers previously excluded from gambling in other Australian states.
On October 29, Star confirmed it would accept the Federal Court’s decision.
The company said the A$260 million payment was broadly consistent with provisions already recorded in its accounts and would not prevent it from continuing as a going concern.
Chairman Soo Kim, who is also chairman of Bally’s Corporation, acknowledged the ruling while emphasizing that the company’s current management and ownership were not responsible for the historical conduct.
Star has undergone significant financial restructuring following a A$300 million rescue package backed by Bally’s and the Mathieson family in April 2025.
The company has also reported improving operational performance, including positive EBITDA across its three casino properties.
However, the court penalty has created another financing issue.
According to an October 29 company update, the judgment triggered a review event under Star’s credit facility agreement with US-based lender WhiteHawk.
Star said it was continuing discussions with the lender and remained confident that the financing would stay available.
The development suggests that while Star’s immediate financial position may have improved, the operator still faces challenges associated with its regulatory history and restructuring.
The penalty adds to a series of major enforcement actions against Australian casino operators over weaknesses in financial crime prevention.
Star’s case illustrates how failures to monitor high-risk customers can lead to consequences extending beyond regulatory fines, including license restrictions, management changes and difficulties securing financing.
The company’s current leadership says it has strengthened compliance procedures, although the effectiveness of those changes will ultimately depend on continued regulatory oversight and operational performance.
The ruling may also warn other casino operators that financial pressures and past penalties do not eliminate the risk of further enforcement action for serious historical breaches.
Vladimir is a senior iGaming writer and editor, adept at breaking down the key details of crypto casinos and sportsbooks so players don’t have to, delivering honest, player-focused information that actually matters.
