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The British bookmaking giant behind Ladbrokes and Neds allegedly failed to cut off a customer who punted more than $1 million in a single year despite knowing an internationally wanted criminal suspected of trafficking drugs had transferred money into his bank account.
Entain’s Ladbrokes is one of the most prominent wagering brands in the country. Getty
Over 640 pages, the Australian Transaction Reports and Analysis Centre has alleged London-listed Entain repeatedly breached anti-money laundering laws and did not bother to put in proper checks on how some of its biggest customers were financing yearly multi-million dollar betting.
Although Austrac announced its lawsuit against Entain last year, the new filings are the first time the agency is detailing the company’s wrongdoing. Austrac has alleged that the failings by the company’s board and senior management exposed the company’s banking partners and “resulted in serious and systemic non-compliance … over many years”.
Entain is one of the country’s largest online bookmakers and had almost 2 million customers last year with a market share of 17 per cent. It has faced similar lawsuits in the United Kingdom, where it has a market capitalisation of £3.7 billion ($7.6 billion), paying a $29 million fine in 2022 for breaches.
In its claim, Austrac alleges Entain’s poor oversight created money laundering risks with at least 17 customers and $152 million.
According to the new details, Customer 13 deposited more than $4.2 million into two Entain accounts between 2015 and 2022, and Austrac alleges the company should have suspected his funds were suspicious by 2019.
It was then that Customer 13 – names have been redacted in the court documents – provided a bank statement that claimed he had received $150,000 for a “granny flat”. The person who transferred the money was on a “red [international arrest] notice list for serious criminal offences, namely drug crimes and trafficking in a South-East Asian country”.
By 2019, Customer 13 was depositing nearly $69,000 a month. The following year, this had increased to $94,000, or $1.1 million over 12 months.
“A pattern of large amounts of money being regularly moved … on an ongoing basis is not consistent with the transactional activity of an average gambler and involves heightened money laundering and terrorism finance risk,” documents filed by Austrac with the court read. “The amounts of money being deposited and withdrawn … were materially above average total annual deposits and withdrawals for Entain’s customers.”
In 2020, the employee assigned to work with Customer 13 allegedly told Entain that he had “no idea” what his client did for work, although they “believed” that he ran a business when asked about the source of his money.
The employee, known as a business development manager, allegedly did not want Entain to contact his client because it might “scare him off”. Business development managers are assigned to high-spending customers and receive commissions for the amount of money they lose.
In another matter, Customer 15 was detected depositing unusually high amounts of money from foreign accounts. Austrac alleges Entain Australia chief executive Dean Shannon personally reviewed the account and decided that he was “very low-risk” because he had been wagering for a decade and publicly available information about his wealth matched his spending.
Meanwhile, Customer 7 wagered $20.2 million between 2015 and 2022 through two Entain accounts, one with Ladbrokes and the other Neds. Austrac alleges that despite Customer 7 sharing a name with a convicted drug trafficker, Entain did not make proper checks until August 2021.
It also alleges Customer 7 displayed unusual depositing and withdrawing patterns from July 2016, and that during the period Entain did not have sufficient information about where the client was getting its money.
In May 2018, according to the court filing, an Entain employee advised the company that his customer owned two Sydney car yards. This information was not confirmed and Customer 7 later told the company that while he was a car salesman, he was not currently employed and owned no car yards.
By August 2021, when it began inquiries, Austrac was aware that Customer 7 was depositing cash and unemployment payments into its accounts. While it closed the Ladbrokes account the following month, Entain did not close Customer 7’s second account, with Neds, until October 2022.
Another client, known as Customer 1, was allegedly the subject of negative press and had been convicted of robbery and being part of a criminal gang that had attempted to recover money from a drug deal.
Austrac claims that this information was easily obtainable for Entain from 2008, as were details of Customer 1’s seven-year jail sentence. However, the employee assigned to Customer 1 allegedly asked Entain’s anti-money laundering compliance officer not to contact his client because this could “upset” them, and that they were a “great client” for the company.
Customer 17, another client included in Austrac’s claim, wagered $30.8 million through Ladbrokes in five years, at one point depositing $1 million per month. Customer 17 later told Entain he had made a number of successful “speculative investments” that were never verified. When asked the name of the business he had sold, he said that it was “private”.
Entain eventually cut off his accounts last year when the company concluded that his wealth did not support his wagering activities.
Austrac has pursued several major companies for anti-money laundering law breaches and issued more than $2 billion in penalties since 2015, when it fined Tabcorp $45 million for facilitating dirty funds. The agency has also forced Westpac and Commonwealth Bank to pay respective fines of $1.3 billion and $700 million for anti-money laundering breaches.
Stella David, chief executive of Entain, said the company was taking the allegations seriously. It plans to introduce new anti-money laundering and counter-terrorism finance compliance measures by June 2025.
“We are committed to keeping financial crime out of gambling and continue to play our part in supporting a well-regulated and compliant sector for our customers, stakeholders and the wider community,” she said.
