Star Entertainment Penalty Could Be $400 Million As Judgment Nears

The Federal Court of Australia is expected to hand down its ruling on the size of the civil penalty facing Star Entertainment Group possibly this week, in proceedings brought by financial intelligence regulator AUSTRAC over serious and systemic breaches of Australia’s anti-money laundering and counter-terrorism financing (AML/CTF) laws. The decision will determine whether the casino operator pays a penalty approaching AU$400 million, as sought by the regulator, or a substantially reduced sum as urged by the company.

The Case Against Star

AUSTRAC commenced civil penalty proceedings in the Federal Court against Star’s operating entities in late 2022, alleging prolonged non-compliance with the AML/CTF Act dating back to 2016. The regulator claimed Star breached the legislation “innumerable times,” citing failures that included inadequate risk-based systems and controls, insufficient monitoring of high-risk customers and junket operators, and deficiencies in reporting obligations.

Central to the case were Star’s dealings with junket operators, most notably Suncity, which was the company’s largest junket partner. According to court filings, Star’s turnover from Suncity reached approximately $2.1 billion, $4 billion and $5.9 billion across successive years from 2017, with junket operations generating more than $11.8 billion in Sydney and $2.9 billion in Queensland over the relevant period.

The parties remain far apart on the appropriate sanction. AUSTRAC has submitted that a penalty of $400 million is warranted, reflecting the gravity and duration of the contraventions. Star has argued for a penalty of approximately $100 million, warning that a fine at the level sought by the regulator could push the company into insolvency.

Notably, Star chose to defend the proceedings rather than negotiate an early settlement, contending that it could not afford an unlimited exposure. This stands in contrast to the approach taken by other major Australian gaming operators, which resolved AUSTRAC enforcement actions by agreement.

A Track Record of Regulatory Sanctions

The AUSTRAC proceedings form part of a wider pattern of regulatory action against Star. In 2022, the company was fined $100 million by the New South Wales Independent Casino Commission following the Bell Review, which found Star unsuitable to hold a casino licence, and its Sydney licence was suspended. A subsequent inquiry in 2024 resulted in a further $15 million penalty.

Separately, in proceedings brought by the corporate regulator ASIC, the Federal Court found in March 2026 that two former senior executives – including the company’s former CEO and Managing Director – breached their statutory duties of care. Penalties and disqualification orders followed in June, with the former chief executive fined and disqualified from managing corporations. The former Chief Casino Officer and Chief Financial Officer had earlier been penalised after admitting breaches.

AUSTRAC has secured substantial penalties in comparable cases, most notably a $1.3 billion penalty against Westpac in 2020 for serious AML/CTF failures. The outcome for Star will therefore be closely watched as an indicator of the court’s willingness to impose penalties proportionate to systemic compliance failures – and of the weight given to a company’s financial capacity to pay.