Follow up of Regulating Gambling and Liquor

Tabled: 28 November 2019

Audit overview

Previous audit

In February 2017, the Victorian Auditor-General tabled the Regulating Gambling and Liquor audit report in the Victorian Parliament. The objective of this follow up audit was to assess whether the Victorian Commission for Gambling and Liquor Regulation (VCGLR) has taken the action it said it would in response to the 13 recommendations we made to it in 2017. Victoria Police and the remaining recommendation for the Department of Justice and Community Safety (formerly the Department of Justice and Regulation) are not included.

During this follow up audit, VCGLR started investigating allegations of money laundering and other criminal activity at Crown Casino. VCGLR cannot take enforcement action in relation to suspected money laundering or receive information on money laundering activity from the Australian Transaction Reports and Analysis Centre (AUSTRAC). Under the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 VCGLR's role is to share any information its casino inspectors detect with responsible regulators and law enforcement agencies. VCGLR has an obligation under the Casino Control Act 1991 (CC Act) to ensure the management and operation of casinos remain free from criminal influence or exploitation. Its investigations are ongoing.


VCGLR has progressed all 13 recommendations directed to it in 2017. As a result, liquor licensing processes have improved, liquor regulation now has a more risk‑based model, guidance for staff and commissioners has improved, performance reporting better reflects intended outcomes and VCGLR has established a dedicated casino team.

However, further work is required to complete actions on most recommendations. This includes implementing risk-based models for gambling regulation, embedding the new performance reporting system and monitoring implementation of the quality assurance framework designed to improve compliance.

We have evidence that where VCGLR identified evidence or intelligence in relation to suspected criminal activity (such as money laundering) it has referred such material to law enforcement agencies such as AUSTRAC. VCGLR has also committed to share information on suspected or actual money laundering in Crown Casino within its regulatory remit, and to engage with other agencies to further clarify respective roles, responsibilities and any collaborative arrangements. We found that VCGLR could improve guidance for its staff on the CC Act, how to mitigate risk with their casino supervision and on the roles of agencies working on anti-money laundering.


Figure A shows VCGLR's progress on each recommendation. It uses the following indicators:


Recommendation completed


Recommendation in progress

Figure A
Status of recommendations


Licensing industry participants (Chapter 2)

1. Changes to liquor licensing process (blue)

Recommended changes made to liquor licensing processes.

2. Ongoing liquor licensee checks (teal)

VCGLR has a system for checks of licensees, but only checks a small, non-statistical sample.

3. Guidance on licence application (teal)

Improved guidance available to licensing officers. System limitations impact VCGLR's ability to monitor compliance with guidance.

4. Risk-based licensing model (liquor) (blue) and Risk-based licensing model (gambling) (teal))

Risk-based model for liquor licensing implemented.

VCGLR finalising implementation of its risk-based model for gambling licensing.

5. Assessing electronic gaming machines (blue)

Guidance on assessment for 'no net detriment' improved.

6. Reporting on licensing activities (teal)

Measures revised. Once embedded, new reporting system should significantly improve management reporting capabilities.


Assuring compliance (Chapter 3)

7. Data integrity checks (blue)

VCGLR has undertaken action to improve data integrity, including implementation of a new reporting system.

8. Risk-based compliance approach (liquor) (blue) and Risk-based compliance approach (gambling)(teal))

Liquor harm prioritisation system and process implemented.

Gambling system and process in early implementation stage.

9. Compliance quality/assurance framework (teal)

Framework completed. Further work required on suite of standard operating procedures that support compliance work.

10. Training compliance inspector (blue)

Compliance inspectors receive formal and informal training.

11. Supervising casino operations (teal)

Dedicated casino team in place. Need to ensure staff training helps staff understand the roles of various casino regulators and improve transparency of the team's risk-based approach.


Measuring performance and collaborative enforcement (Chapter 4)

12. Publicly report performance measures (blue)

Budget Paper 3: Service Delivery (BP3) performance measures reviewed by VCGLR and the Department of Justice and Community Safety.

13. Adopt collaborative enforcement strategy (blue)

Collaborative enforcement strategy agreed between VCGLR and Victoria Police.

Source: VAGO.

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