Australia’s financial crimes watchdog AUSTRAC filed a statement of claim in the Federal Court on Wednesday alleging SkyCity Adelaide engaged in “serious and systemic” non-compliance with anti-money laundering and counter-terrorism financing laws.

Contained within AUSTRAC’s 800-page statement of claim are an extensive list of allegations against SkyCity Adelaide claiming non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006, including alleged failures to conduct ongoing customer due diligence on 59 people “posing high ML/TF (money laundering/terrorism financing) risks”.

The court documents claim that “many” of the 59 “high risk” customers participated in junket programs – a form of VIP high roller gambling for high wealth individuals – and contributed to a customer turnover “in excess of $4 billion” and buy-ins “in excess of $464 million”.

AUSTRAC alleges that from December 7, 2016, the 59 customers incurred losses – or wins for SkyCity Adelaide – of around $74 million.

It also claims some of the customers were foreign “politically exposed persons” while others had reported links to organised crime.

“SCA (SkyCity Adelaide) was aware that some of the customers had been charged or arrested in connection with offences, including dealing with the proceeds of crime and money laundering,” AUSTRAC alleges.

“SCA was aware of information suggesting that some customers were connected to organised crime or that their source of funds or source of wealth may otherwise not be legitimate.”

The claim also alleges that “many” customers “engaged in large cash transactions and transacted with cash that appeared suspicious including in plastic bags, garbage bags, cash bundled together with rubber bands or irregular straps, cash that was dirty and cash that appeared to have been buried”.

“Many [customers] engaged in large and unusual transactions and patterns of transactions, which had no apparent economic or visible lawful purpose,” AUSTRAC claims.

“SCA received numerous law enforcement requests with respect to some customers, some of which related to money laundering investigations and some of which related to conduct that had occurred at SCA.

“Despite these ML/TF risks, SCA continued to provide designated services to these customers, without carrying out appropriate risk-based ongoing due diligence, including enhanced customer due diligence.”

AUSTRAC’s 800-page statement of claim includes anonymised details on the actions and transaction of the 59 “high risk” customers allegedly involved with Adelaide Casino.

One unnamed person, known as “Customer 11”, is described as an “immediate family member of a person holding a prominent public position in a foreign government body”. They are also described as a “close family member of a high-ranking foreign official”.

Later in the claim, AUSTRAC alleges that SkyCity Adelaide was aware from at least August 2017 of reports that Customer 11 was “formerly the chairperson of a company that had been found to be a special interest entity due to having sanctions applied by a foreign government”.

Customer 11 participated in 10 junket programs at Adelaide Casino with an estimated combined turnover of more than $463 million, AUSTRAC alleges.

The statement of claim asserts that SkyCity Adelaide recorded losses of $20,843,275 for Customer 11 between December 7, 2016, and November 13, 2018. It also claims he was one of SkyCity Entertainment Group’s top six customers by turnover in the 2019 financial year.

“Customer 11 engaged in large and unusual transactions and patterns of transactions, which had no apparent economic or visible lawful purpose and appeared to be an attempt to disguise the source and beneficiary of funds,” AUSTRAC alleges.

“It was not until August 2019 that SCA identified that Customer 11 was a foreign PEP (politically exposed person), and only as a result of media reporting, identified Customer 11 as a close family member of a high-ranking foreign official.”

SkyCity Entertainment Group is yet to file a defence in the Federal Court. A spokesperson for SkyCity Adelaide did not respond to inquiries today.

In a statement to the ASX on Wednesday, SkyCity Adelaide’s New Zealand-based owner, SkyCity Entertainment Group, said it would give “careful consideration” to AUSTRAC’s allegations.

“SkyCity Adelaide places the utmost importance on compliance with its regulatory obligations including its anti-money laundering compliance and will give the allegations in the AUSTRAC claim, once received, careful consideration before responding,” the company said.

“Given that the matter will be before the Court it would be inappropriate for the company to comment further on the allegations at this stage.”

SkyCity also said it would “continue to cooperate with AUSTRAC more generally, particularly in the ongoing implementation of enhancements to its Adelaide AML/CTF control frameworks”.

The company also said AUSTRAC had “not yet identified the level of penalty it intends to seek”.

AUSTRAC’s statement of claim alleges 124 contraventions of Section 36 of the AML/CTF Act – the requirement for casinos to conduct ongoing customer due diligence for AML/CTF risks – and “innumerable” contraventions of Section 81 of the Act – the requirement to have an AML/CTF program.

The document notes that each contravention attracts a maximum penalty between $18 million and $22.2 million, meaning SkyCity Adelaide could be facing a penalty upwards of $2.2 billion.

SkyCity management has previously told shareholders that it is keeping its “liquidity headroom” more than three times higher than normal levels due to future uncertainty associated with a range of factors, including “potential regulatory penalties”.

SkyCity Adelaide is still under scrutiny from a separate inquiry by retired South Australian Supreme Court judge Brian Martin KC, which is probing whether SkyCity is still fit to hold its South Australian casino license.

The launch of the inquiry prompted renewed calls from SA-Best, and then later the Greens, for a Royal Commission into Adelaide Casino.

Martin’s final report and recommendations are due to be handed down on February 1 next year.