The very fact that a company the size of Crown Resorts has had to admit that their anti-money laundering department failed to notice some dubious activity focused on a couple of accounts is astonishing. However, it also highlights the potential difficulties faced by smaller companies if one of this magnitude finds itself on the wrong side of being accountable to potential money laundering issues.
In addition, the way in which Crown Resorts has now had to admit to this breach is in direct contrast to what their chief legal officer was saying at the end of July. Back then, Joshua Preston, claimed that if the company had indeed noticed suspicious activity linked to accounts that they would have indeed contacted the authorities. However, he then claimed that there was no legal requirement to do so if all that occurred was certain payment thresholds being breached.
Now, he admits that both he and the company were wrong.
While this may all sound as if it’s much ado about nothing, that’s not actually the case. Yes, there were only two accounts involved, but the total payments amounted to hundreds of thousands of Dollars. However, it’s when you look more closely at the accounts that things get interesting.
The accounts belonged to two shell companies under the names, Riverbank Investments and Southbank Investments. While it’s clearly not illegal for shell companies to own accounts linked to gambling, it turns out that the creator of both companies was Crown Resorts.
It appears that the accounts were created for patrons to be able to place money into a gambling account and to do so privately. One issue was that the company names failed to indicate that it was linked to a casino.
Problems with the Accounts
One issue with this type of account is the way in which it leaves itself wide open to potential abuse. Also, fraudsters see it as an open door and that is where the possibility of money laundering can come into play.
How this is all going to play out in the future is up for debate. There are calls for sanctions and for the license linked to a new casino to be removed from Crown Resorts as a direct punishment for their failings. It remains to be seen if this is what will happen, but you can perhaps expect a tightening of laws and legislation linked to this entire concept to prevent any additional problems in the years to come.