Slot Machines Thriving During Pandemic in New South Wales, Authorities Say Criminals Using Pokies

Posted on: December 1, 2020, 10:31h. 

Last updated on: December 1, 2020, 10:52h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Slot machines, or pokies as they’re known throughout Australia, are seeing an increase in play and profits during the COVID-19 pandemic. But authorities say that isn’t a good thing.

slot machines pokies Australia money laundering
Authorities say pokies, aka slot machines in Australia, are being used at alarming rates to launder money. (Image: ABC)

Despite numerous coronavirus restrictions in place on casinos and pubs and clubs for five months in New South Wales (NSW), gross gaming revenue from pokies surged $305 million from June through October. The slot terminals reported revenue of $3.1 billion — up nearly 11 percent from $2.8 billion in the same five-month period in 2019.

The revenue data comes from the NSW Independent Liquor and Gaming Authority (ILGA).

While increased gaming revenue is typically welcomed news for companies invested in the gaming industry, the slot numbers have generated concern among state officials.

Poker machines get targeted by criminal elements because they are a simple and cost-effective way of money laundering by washing cash through a machine,” Philip Crawford, chairman of the ILGA, told The Sydney Morning Herald.

“Any reasonable steps that can be taken to reduce money laundering in NSW, including use of technology, should be seriously considered by the government and by industry,” Crawford added. One step proposed is the introduction of a gaming card, which would require gamblers to load funds and create a paper trail of their money.

Airing Dirty Laundry

Law enforcement in Australia says criminals Down Under have long used pokies to make illicit money appear clean. In NSW, pokies are found at The Star Sydney, as well as at pubs and clubs.

There are approximately 96,000 slot machines in NSW, and only 1,500 are at The Star. Authorities explain criminals deposit large sums of cash into the pokies, play for a short period of time, and then withdrawal the laundered money in the form of a check.

“With criminal organizations or individuals exploiting clubs and pubs, they’re willing to lose 20 to 30 percent of what they want to clean to get that winning check or that piece of paper that validates where they’ve got that money from,” explained Troy Stolz, a former NSW anti-money laundering and counterterrorism compliance officer.

Australia’s Anti-Money and Counter-Terrorism Financing Act requires casinos and other businesses that have at least 15 pokies to report transactions of AUD$10,000 (USD$7,366) or more to AUSTRAC — the Australian Transaction Reports and Analysis Center. But of the 4,000 venues that house pokies in NSW, less than 800 have at least 15 terminals and are therefore required to file large transaction reports.

Even when the business is required to file transaction reports, criminals often structure their play to stay under $10,000.

Card Solution

A gambling card has gained support among law enforcement agencies, NSW Minister for Customer Service Victor Dominello, and gambling reform advocates.

There is a way to reduce money laundering, which will in turn likely reduce criminality,” opined Tim Costello, chief advocate for the Alliance for Gambling Reform. “The answer is the universal cashless gambling card proposed by Minister Victor Dominello.”

Aussies spend more per person gambling than any other country in the world. Australians lose on average $1,000 per year gambling.

“[A card] would greatly assist in the development of strategies to assist problem gamblers, and it would significantly reduce the opportunities for money laundering,” Crawford concluded.