Tabcorp Hit With AUD 1 Million Fine for Compliance Failures

Australian gambling company Tabcorp has been slapped with a significant AUD 1 million ($638,655) fine, marking the largest penalty ever imposed by the Victorian Gambling and Casino Control Commission (VGCCC) against the company. This hefty fine is the result of Tabcorp's repeated failure to comply with directives issued by the regulator following an investigation into a system outage during the 2020 Spring Racing Carnival.

The VGCCC has characterized Tabcorp's conduct as "unacceptable" and emphasized the severity of the compliance failures. The fine was imposed on Tabcorp's subsidiary, Tabcorp Wagering (VIC) Pty Ltd.

The VGCCC's chair, Fran Thorn, stated, "We will not tolerate licensees that are not forthcoming and cooperative when the commission investigates. The commission had to use its compulsory powers and issue directions because Tabcorp did not provide the information we required about the business continuity and disaster recovery capability of its systems."

Thorn further added, "It is Tabcorp’s failure to comply with these directions that has led to the fine announced today. All entities we regulate, no matter how big or small, have an obligation to be open and honest with the commission and responsive to its lawfully issued directions. We will not tolerate attempts to frustrate our investigations."

The investigation by the VGCCC began after an outage on November 7, 2020, during a crucial race day. Tabcorp's Wagering and Betting System (WBS) experienced a significant disruption, which led to an inquiry by the VGCCC's predecessor, the Victorian Commission for Gambling and Liquor Regulation. Under the terms of its wagering and betting license for the WBS, Tabcorp is obligated to ensure the continuous availability of its system.

The AUD 1 million fine is the result of directives issued by the VGCCC after Tabcorp failed to provide sufficient voluntary information regarding the outage to the regulator. Notably, non-compliance with directives from the commission carries the potential for a maximum penalty exceeding AUD 9 million ($5.7 million).

"The commission found Tabcorp did not comply with the first direction because it failed to produce a response that, in either form or substance, confirmed the WBS business continuity and disaster recovery arrangements established after the outage were ‘fit for purpose’ to deliver the ‘continuously available’ performance requirement. Tabcorp was found to have failed to comply with the second direction by submitting a compliant report four months after the deadline," the VGCCC explained.

This development follows Tabcorp's recent report of a net profit after tax (NPAT) of AUD 66.5 million ($42.7 million) in FY23, marking its first full year of operation following the demerger of the Lotteries and Keno business in June 2022.