DAVY VIEW

Entain (ENT) has released a statement relating to the Australian Transaction Reports and Analysis Centre (AUSTRAC) confirming that it has commenced civil penalty proceedings in the Federal Court against ENT. The AUSTRAC statement alleges serious and systemic non-compliance with Australia’s anti-money laundering (AML) and counter-terrorism financing (CTF) laws. ENT has also released a statement noting that it has fully cooperated throughout its investigation and has been conducting a detailed enhancement programme in respect of its AML and CTF systems and processes. ENT has noted that there is no update on the size or certainty of any penalty for the alleged offences. It does note that a penalty could be potentially material. This is a difficult situation for ENT, particularly given it follows the £615m deferred prosecution agreement for bribery offences in Turkey. Its leverage ratio is also relatively high (3.3x), so the uncertainty around any potential penalty is unhelpful.