Bally’s says A$260 million Star casino fine will not make the operator insolvent

Bally’s Corporation says a A$260 million (about US$184 million) anti-money-laundering penalty will not make Australia’s The Star Entertainment Group insolvent. Its 29 October 2026 statement followed a Federal Court ruling against Star casino subsidiaries and came as Star disclosed that the penalty had triggered a review under its financing agreement with WhiteHawk Capital Partners.

The court imposed the penalty on 28 October over historical failures to comply with Australia’s anti-money-laundering and counter-terrorism-financing laws. Star accepted the ruling the next day and said the four-instalment schedule, spread over 19 months, would not prevent it from continuing as a going concern. That is the company’s assessment, not a guarantee that its financial risks have disappeared.

What the court found

AUSTRAC brought the civil proceedings in November 2022 against The Star Pty Limited and The Star Entertainment Qld Limited. The court found that Star had failed to maintain a compliant AML/CTF program and to monitor customers and the origins of funds through high-risk gambling channels.

AUSTRAC said the failures included inadequate checks on high-risk patrons, poorly controlled junket activity and gambling transactions involving third parties whose identities were not properly recorded. According to the regulator, more than 1,200 customers were able to gamble through channels presenting elevated money-laundering and terrorism-financing risks.

Reporting on the judgment put the split at A$195 million for Sydney operations and A$65 million for Queensland. Star had argued for a penalty of no more than A$100 million because of its fragile finances, while AUSTRAC sought A$400 million. The court selected an amount between those positions.

AUSTRAC chief executive Brendan Thomas said the ruling reflected serious failures rather than paperwork mistakes. The regulator said Star had permitted high-risk customers to gamble without properly establishing where their money came from.

Bally’s points to improving results — but the lender still has a say

Bally’s and associates reported a 37.7% voting interest in Star when that stake converted to equity in late 2025; Star later described the holding as about 38%. Bally’s says the wrongdoing predated its investment and the appointment of Star’s current leadership. Executive chairman Soo Kim, who also chairs Star, said the turnaround was progressing and that he did not believe the ruling rendered the operator insolvent.

Bally’s cited Star’s first-quarter fiscal 2027 group EBITDA of A$12 million, compared with negative A$13 million a year earlier. It also reported a 9% sequential revenue increase across Star’s Sydney and Gold Coast properties. EBITDA measures operating performance before certain costs; it does not mean the company has A$12 million available to pay its fine.

Star said the penalty was materially in line with the provision recorded in its fiscal 2026 accounts. The amount and payment terms still constitute a review event under its WhiteHawk credit facility. Star said it was engaging with the lender and was confident the facility would remain available. That expectation is not confirmation that the review has been resolved.

For customers at Star’s Australian casinos, the ruling does not itself announce a closure, cancellation of player balances or a new withdrawal restriction. The immediate issue is the operator’s capacity to keep funding operations and regulatory remediation while meeting the court’s payment schedule. Ongoing regulatory supervision and the financing position remain relevant to customers who hold funds or gaming entitlements with the operator.