Bally's: $260 million penalty will not push Star into insolvency

The Federal Court of Australia ordered Star Entertainment to pay A$260 million (A$260m) in a case brought by AUSTRAC. The penalty stems from past breaches of anti-money laundering and counter-terrorism financing rules at the company's Sydney and Queensland properties. Star fully accepted the penalty. The company had previously offered to pay up to $100 million, while AUSTRAC had sought $400 million.

The penalty will be paid in four instalments between November 2026 and May 2028. Although a payment arrangement has been made available, the effect of the penalty on Star's financial position remains a concern for investors.

Bally's holds a stake of about 38% in the company. In its statement, the group said the ruling will not push Star into insolvency. Soo Kim, chair of the board, said Bally's respects the efforts of AUSTRAC and the court to keep casino operators to a high standard. Kim also said the group is proud of the progress made in a short time by Star's new management team, and added that Bally's has operated casinos for many years in jurisdictions with strict regulation.

According to figures released by the company, Star posted group EBITDA profit of $12 million in the first quarter of fiscal 2027. In the same period of the previous year, it had recorded a loss of $13 million. Combined revenue at the Sydney and Gold Coast properties rose 9% compared with the fourth quarter of 2026. This is the first time since quarterly reporting obligations began in September 2024 that revenue at the two properties has increased by this amount.