Tabcorp shares plummet on back of money laundering investigation
Tabcorp has come under formal investigation from Australia’s anti-money laundering watchdog AUSTRAC, wiping more than $500 million from the wagering giant’s market value after investors reacted sharply to the announcement.
The company confirmed on Thursday that AUSTRAC had launched an investigation into its compliance with anti-money laundering and counter-terrorism financing obligations. Tabcorp shares plunged more than 25 per cent in early trade, slashing the company’s valuation after the ASX disclosure.
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AUSTRAC said it held “serious concerns” about Tabcorp’s ability to prevent criminal activity, including potential money laundering and terrorism financing, through its betting platforms.
Chief executive Gillon McLachlan said the company would cooperate fully with regulators as Tabcorp continued efforts to strengthen its compliance systems.
“I am committed to leading a compliant and safe company that understands its risk obligations,” the former AFL CEO said.
“Uplifting our risk capability has been an ongoing part of the Company’s transformation and we will work constructively with AUSTRAC through this process.”
Tabcorp Chairman Brett Chenoweth echoed McLachlan’s sentiment, saying the company was taking the investigation “very seriously” and would cooperate with AUSTRAC.
“Tabcorp takes its anti-money laundering and counter-terrorism financing obligations very seriously,” he said.
“The Board and Executive are fully committed to collaborating with AUSTRAC in the continuing uplift in Tabcorp’s ML/TF risk maturity.”
The probe could expose Tabcorp to substantial penalties if breaches are identified. AUSTRAC has previously issued massive fines against major Australian companies, including Crown Resorts, Westpac and Commonwealth Bank, over anti-money laundering failures.
Tabcorp, which runs one of the biggest betting sites in Australia, was previously fined $45 million by AUSTRAC in 2017 over historical compliance breaches.
