Australian States Under The Spotlight Over Casino Junkets 


Those who frequent casinos are quite familiar with the glitz and glam that accompanies the experience – from the promise of life-changing riches, to fast cars and cruises aboard luxury yachts, the allure of the high life is so appealing, especially to those who may be looking for a quick fix to their lives. 

However, not many stop and think about the potential underworld dealings that take place behind the scenes. From money laundering to terrorism, casinos are not always the “wholesome” environments that they seem.  

Australian casinos, in particular, have recently been singled out as a major contributor to this problem

Turning a blind eye 

As much as casinos are stringently regulated in Australia, at least as much as in other first world countries, several Australian states seem to have turned a blind eye when it comes to regulating the types of prizes and incentives being offered by casinos. It has come to light that some of these junkets, specifically the VIP tours, are attracting a criminal element.  This is nothing new, as both WA and Victoria stopped regulating this area of casinos over a decade ago, with only Queensland still regulating these junkets. 

The onus is on the casino 

Due to the fact that most casinos are not event coordinators, many outsource these tours to specialist companies. The states in Australia argue that it is therefore the casino’s responsibility to ensure that they partner with reputable tour and event operators to ensure that no underhanded activity is taking place under the guise of a casino junket. However, it is hard to imagine that any operator would willingly declare that they are involved in money laundering or the financing of terrorism.  

A bad precedent 

By placing the onus on the casinos themselves, it has allowed recent claims – which if proven true could cripple the industry – that Crown Resorts is involved in money laundering via its casinos based in Melbourne and Perth. 

This not only has a potentially damning impact on the casino industry at large, but could also directly impact the economy as it could put a massive $2.2 billion Sydney Barangaroo venue in jeopardy at a time that the Australian economy is in dire need of capital injection.  

Understanding the largesse 

The vast majority of Australian casinos are completely above board and do not promote these luxury junkets for nefarious purposes. The truth is that players are receiving incentives like stays in 5-star hotels, dinners and cash credits. These need to be extremely enticing as offshore illegal operators are literally throwing money at players to get them online.  

At the end of the day, it all comes down to business. Due to the economic impact of Covid19 on the world’s economy, players’ pockets have been hit like never before – and even a country like Australia, who were one of the best to respond to the pandemic, have felt the crunch. After all, this is a global economy. For that reason, casinos have to try whatever is within their means to attract players back into the fold, and if that means high end junkets then that is what they need to do. 

The damning evidence 

In 2017, an Australian Transaction Reports and Analysis Centre (AUSTRAC) report highlighted a dire lack of oversight from state gaming regulators when it came to casino junkets. They found inconsistencies between the states and the territories “in relation to the extent of the junket oversight they undertake”.  

They also uncovered that some gaming regulators were lax in their authority by passing the responsibility of oversight of junkets to third parties due to tighter budgets. 

However, the precedent was set back in 2004 when the Victorian Commission for Gambling and Liquor Regulation (VCGLR) changed the game by placing the regulation of junkets squarely on the shoulders of the casinos.  

What did Crown Resorts actually do? 

There has been no criminal prosecution as yet, but the evidence is mounting. A leaked video in 2019 from the Crown Melbourne clearly shows a gentleman exchanging large sums of hard currency for casino chips. During the New South Wales inquiry into this, it was revealed that there was a $100k playing cap in place, yet the money in play at the time was over fifty-six times this amount. Most of the alleged laundering took place in Crown’s Suncity room. 

In response to the allegations, Crown Resorts cancelled all their contracts with junket operators except for those who could be approved by the state, thereby putting the ball straight back into the state’s court.  

Where to next? 

Since the Crown allegations have come to light, the state can no longer take a hands-off approach to the regulation of junkets. If casinos – even though the vast majority are above board – cannot be trusted to self-regulate, it then becomes the prerogative of the state to ensure that no criminal activity is allowed to thrive on Australian soil. 

If proper action is not taken in the near future, Australia could well become a breeding ground for organised crime with dire consequences.