Pressure has stepped up on one of Australia's largest online betting agencies after audit processes revealed concerns over its compliance with anti-money laundering and terrorism financing laws.
Late last year Australia's financial intelligence and enforcement agency Austrac placed a supervisory order on Sportsbet and Bet365, demanding they appoint external auditors to assess their compliance.
This level of scrutiny has now intensified with the Australian Transaction Reports and Analysis Centre (Austrac) now commencing a separate enforcement investigation into the company that runs Bet365, Hillside (Australia New Media) Pty Limited.
"The investigation will focus on whether Bet365 has complied with its obligations under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 and follows a supervisory campaign of entities within the corporate bookmaker sector and Austrac's consideration of the external audit report received following Austrac's order to Bet365 to appoint an external auditor," the financial watchdog said in a statement.
Hillside (Australia New Media) is a foreign-owned, private company that derives its revenue from the provision of mobile and internet sports betting activities. The company employs around 342 people nationally and has its Australian headquarters in the Northern Territory.
The parent company is the UK-based Hillside (New Media Holdings) Limited, which has some 45 million customers worldwide.
Online sports betting companies in Australia take an estimated $50 billion in bets every year.
When Austrac's supervision of the companies began in November, it requested that the external auditors examine whether they had systems which would "effectively identify, mitigate and manage money laundering and terrorism financing risks".
The auditors were also required to produce a risk assessment "that considers the risk posed by their customer types".
Austrac's chief executive officer Brendan Thomas said betting agencies, like all regulated entities, have a significant role to play in combating financial crime.
"Corporate bookmakers must have robust systems in place to ensure they can manage and mitigate risks associated with money laundering and terrorism financing," Mr Thomas said.
"Businesses without adequate processes in place to manage those risks leave themselves vulnerable to exploitation by criminals.
"Austrac will not hesitate to take action where suspected non-compliance is identified, to protect businesses from being exploited and protect the Australian community from harm."
