Crown's Melbourne and Perth casinos are being taken to court by Australia's financial intelligence agency over alleged breaches of anti-money laundering and counter-terrorism financing laws.
AUSTRAC on Tuesday served the two operations with a statement of claim and commenced civil penalty proceedings in the Federal Court, following an investigation that began in October 2020.
AUSTRAC chief Nicole Rose said Crown's failure to meet anti-money laundering and counter-terrorism financing obligations left the business and Australia's financial system vulnerable to criminal exploitation.
"AUSTRAC's investigation identified poor governance, risk management and failures to have and maintain a compliant ... program detailing how Crown would identify, mitigate and manage the risk of their products and services being misused for money laundering or terrorism financing," she said.
"They also failed to carry out appropriate ongoing customer due diligence, including on some very high-risk customers.
"This led to widespread and serious non-compliance over a number of years."
Ms Rose said the absence of appropriate controls and processes allowed the movement of money in non-transparent ways making Crown vulnerable to criminal exploitation.
"This is an important reminder to all casinos in Australia that they must have a strong anti-money laundering program in place to protect their business and the community from serious and organised crime," she said.
Crown, which is the target of a $9 billion takeover offer from private equity group Blackstone, said the legal action was expected and it was working on improving governance, compliance, responsible gaming and financial crime risk management.
"Crown has developed a comprehensive remediation plan which is intended to position Crown as a leader in the industry in its approach to governance, compliance, responsible gaming and the management of financial crime risk," a company spokeswoman said in a statement.
"Crown recognises the importance of complying with its financial crime obligations and has overhauled its approach to managing financial crime risk."
Crown Melbourne had an under-resourced anti-money laundering team and a culture of "not looking too hard" into its immensely profitable but controversial use of junkets, a Victorian inquiry into whether it could retain its Southbank operations was told last year.
Counsel assisting, Penny Neskovcin QC, told the royal commission Crown Melbourne pocketed more than $900 million through its junket operations between 2017 and 2019.
Crown was aware the junkets could expose it to money laundering and organised crime, she said, but made no changes until a "light was shone on it" during a NSW inquiry that found the James Packer-backed group unsuitable to run its newly built casino in Sydney's Barangaroo.
Meanwhile, a separate inquiry into Crown Perth was told the WA gaming regulator opted not to investigate allegations of money laundering against Crown after the company's "persuasive" former legal boss told them it was a media beat-up.
AUSTRAC's statement of claim does not include any quantification of the penalty sought.
