Slot machines are laundering billions in drug money in Australia

The more-than 86,000 electronic gaming machines are one of the last havens for criminals to funnel dirty cash. PHOTO: UNSPLASH

SYDNEY – Billions of dollars of criminal proceeds are being laundered through slot machines in pubs and clubs in Australia’s biggest state, according to an official inquiry that recommended tighter controls on the gaming industry.

The more-than 86,000 electronic gaming machines, through which A$95 billion (S$86 billion) flowed last financial year, are one of the last havens for criminals to funnel dirty cash, the New South Wales Crime Commission said Wednesday. A lack of data means it’s impossible to know the scale of the activity, though it amounts to “many billions of dollars every year”, it said. 

Most of the dirty money comes from drug dealing, according to the commission. Its recommendations include a mandatory cashless gaming system to combat money laundering through pokies, as the machines are known in Australia.

The findings add more pressure on Australia’s gambling industry following crackdowns on casino operators Crown Resorts and Star Entertainment Group for failings including poor money-laundering controls. A wide-ranging crackdown on pokies, if extended across other states, would impact the finances of thousands of clubs and pubs in communities across the country.

Australians rack up some of the world’s biggest gambling losses per-capita. About 75 per cent of the world’s gambling machines outside casinos are in Australia, according to the Sydney Morning Herald. 

The commission found that using pokies to clean, and then recoup, large volumes of dirty money is high-risk and inefficient. While the practice occurs, it’s not widespread, the commission said. BLOOMBERG

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