July 3 - Australia’s financial crime regulator has concluded that Sportsbet has fulfilled required improvements to its anti-money laundering (AML) and counter-terrorism financing controls after admitting to significant shortcomings two years earlier. AUSTRAC accepted the firm's remediation undertaking in 2024 following concerns it raised about Sportsbet’s compliance.
The regulator had cited weaknesses across several specific compliance functions, notably risk assessment, customer monitoring and the reporting of suspicious matters. AUSTRAC said the firm was obliged to carry out extensive remediation to strengthen its systems, internal controls and governance arrangements.
"Sportsbet was required to undertake significant remediation to uplift its systems, controls and governance," AUSTRAC CEO Brendan Thomas said in a statement, adding that the requirements have now been met.
An external auditor has provided assurance to AUSTRAC that the remediation measures have been implemented. AUSTRAC also indicated it will maintain a high level of oversight of the broader gambling industry, which the regulator regards as vulnerable to money laundering risks, particularly in online channels where transactions are fast and involve limited face-to-face interaction.
The regulator first ordered an audit of Sportsbet, which is owned by Flutter Entertainment, in 2022 as online wagering activity rose following closures of physical betting outlets tied to the COVID-19 pandemic. The audit and subsequent remediation undertaking were responses to that surge and the compliance issues identified.
Sportsbet did not immediately provide a response. The acceptance of the remediation undertaking in 2024 marks AUSTRAC's formal acknowledgment that the specific corrective measures required of the company have been completed, supported by independent verification from an external auditor.
Context and implications
- AUSTRAC's continued monitoring signals sustained regulatory attention on the gambling and online betting sectors.
- Independent audit assurance was a condition for AUSTRAC to accept the remediation as complete.
- The 2022 audit was initiated amid a rapid expansion of online betting activity when physical stores were closed due to the pandemic.