Two former senior executives of The Star Entertainment Group have been found by Australia’s Federal Court to have breached the Corporations Act 2001, due to failures in managing and reporting money-laundering and criminal-activity risks.
The judge’s ruling, handed down on Wednesday, was part of civil penalty proceedings initiated by the Australian Securities and Investments Commission (ASIC).
Justice Lee concluded that a former CEO and managing director, alongside the company’s ex-chief legal and risk officer, did not take adequate measures to address the risks associated with money laundering at the casino operator.
Moreover, they failed to properly inform the board about these critical compliance issues.
This is the latest setback for Star Entertainment, as last year it also faced heavy enforcement for AML failings, following a sweeping investigation by AUSTRAC.
In June 2025 the agency pushed for a $400 million fine for the operator, after numerous AML violations over a period of several years were flagged, ranging from insufficient reporting protocols to a lack of managerial oversight and more.
A four-year long road
ASIC commenced proceedings on 12 December 2022, targeting a total of 11 former directors and officers of The Star Entertainment Group. The regulator alleged breaches of section 180 of the Corporations Act. This mandates that directors must exercise the degree of care and diligence that a reasonable person would in their position.
The primary issue before the court concerned the executives’ failure to meet these standards in relation to The Star’s anti-money laundering (AML) policies and risk management practices. The specific allegations related to insufficient oversight and inadequate reporting structures concerning money laundering and related criminal activities.
Breaking down the Corporations Act
Justice Lee’s judgment explicitly identified breaches by the former CEO/MD and the ex-chief legal and risk officer. They held each personally accountable under their statutory duties. Under the Corporations Act, such breaches can invite civil penalties. This includes fines up to AU$1.05 million ($730,000) per breach and possible disqualification from holding directorships in the future.
As of now, the court has not yet imposed specific penalties.
The court found that the other nine former directors and officers named in the proceedings had not breached their obligations. This outcome highlights the court’s emphasis on the responsibilities of senior executives directly charged with legal and risk oversight functions.
The ruling comes in the same week as The Star appoints a new CEO for its Sydney casino.
Original article: https://igamingbusiness.com/legal-compliance/legal/former-top-executives-star-entertainment-group-breach-corporations-act/
