Australian regulator probes organised crime money laundering via poker machines at small pubs and clubs

The Independent Liquor and Gaming Authority (ILGA) believes criminal gangs are using poker machines at small regional pubs and clubs to launder the proceeds of illegal drug dealing and prostitution in New South Wales, after its data monitoring system identified suspect transactions in the Cessnock, Maitland, Queanbeyan-Palerang, Coffs Harbour and Bland local government areas.  

These are in addition to $5.5 million worth of suspicious transactions detected at poker machines across 180 venues in Sydney since the city came out of lockdown in early October, a figure that is growing at the rate of $1 million a week. 

ILGA Director of Investigations, David Byrne, told ABC News: “I would endeavor to say it could easily double that, and over an annual period, I’d suggest it’s in the hundreds of millions”.

One method of money laundering involves the gambler putting “dirty” money made through illegal activity into a poker machine to make a small number of bets and then cash the rest out on a ticket. 

There have been two suspected incidents which have been referred to the police for further investigation. One of them involves a club in the state’s south where 25 suspicious plays of more than $1,400 each were put into different machines and cashed out only minutes later. 

Another took place in a small club in far western NSW, where over the course of one weekend, a group of people put thousands of dollars through the poker machines, making a small number of bets before withdrawing the rest of the money on a ticket. 

Byrne believes there are also gangs taking advantage of gambling addicts. He described that scenario as “the epitome of exploitation” and compared it to child labor. “So people could sit there in front of a machine and launder cash for an organised group for a very small amount of money in commission”, he pointed out, addressing the addict’s desperation. 

Byrne said he is not surprised the activity took place in small regional pubs and clubs. 

The Authority’s Director of Investigations said investigators would be visiting these regional areas. “We'll be attending those venues and obtaining CCTV footage, reviewing it, corroborating the data and confirming or denying whether or not it's actually money laundering or dealing in proceeds of crime”.

He also stated that there is a need for public inquiry into poker machines and money laundering at pubs and clubs.