Ex-Star Legal Chief Appeals AML Breach Findings

Kyle Kevin

iGaming Writer

Fact Checked

A seven-year ban and a AU$400,000 penalty for a casino’s top lawyer. Her appeal asks a question every general counsel is now watching.

Star Entertainment’s former top lawyer is appealing findings that she breached her duties over money laundering risks. Paula Martin received a seven-year management ban in June. The Federal Court also ordered her to pay a AU$400,000 civil penalty, around US$283,000. Justice Michael Lee found she failed to adequately inform Star’s board about money laundering risks tied to junket partner Suncity. According to the judgment, she also failed to escalate the misuse of China UnionPay cards for gambling. However, Martin now disputes that she had any legal duty to raise those matters directly with the board. Her appeal seeks to have the case dismissed entirely.

What the Court Found

The findings turn on Martin’s seniority and reach. She served as group general counsel, company secretary, and chief legal and risk officer. According to Justice Lee, she could not separate her general counsel duties from her company secretary role. She reported directly to the board. She attended most board meetings. She was responsible for legal advice ensuring Star complied with applicable law. Given that position, the court found a reasonable officer would have told the board about the Suncity money laundering concerns. The same applied to the China UnionPay card issues, which were prohibited for gambling transactions. So the breach was not an act but an omission: what the court found she should have escalated and did not. In June, Justice Lee imposed the seven-year disqualification and the AU$400,000 penalty. The Australian Securities and Investments Commission had sought AU$700,000. So the penalty landed below the regulator’s request. These are court findings, now under appeal rather than settled. Star’s junket relationships also feature in our coverage of Macau’s junket-linked gaming crime.

The Legal Question the Appeal Raises

Martin’s appeal poses a question with wide implications. According to her filing, Justice Lee erred in finding she had a legal duty to raise those matters directly with the board. That is the crux. A general counsel advises. A board decides. Where does advising end and a personal legal duty to escalate begin? The court found her seniority and board access created that duty. Martin argues it did not. So the appeal tests how far personal accountability reaches for a company’s most senior lawyer. That question matters far beyond Star. Every general counsel at a regulated operator watches a case like this. If advising a board can become a duty to escalate over the board’s own processes, the risk calculus for in-house counsel shifts. However, the outcome is unresolved. Martin seeks dismissal of the proceedings. She also wants ASIC ordered to pay her legal costs for both the original case and the appeal. Alternatively, she asks the court to set aside some declarations and reconsider both the penalty and the ban’s length. The AML-accountability trend features in our report on PAGCOR’s casino AML directive.

The Former CEO Appeals Too

Martin is not appealing alone. Former Star managing director and CEO Mathias Bekier has also challenged the findings against him. Bekier received a six-year disqualification and a AU$700,000 penalty in June, around US$495,000. His appeal runs to 11 grounds. According to the filing, he argues Justice Lee wrongly rejected parts of his evidence about the steps he took to address money laundering risks. He also disputes a specific finding. The court held he should have requested all communications between Star and National Australia Bank about China UnionPay transactions, after a 2020 warning letter. Bekier contests that expectation. If the liability findings stand, he separately challenges his penalty. He argues the court failed to properly weigh penalties given to other former Star executives when setting his. So both the top lawyer and the top executive are contesting personal accountability for the same underlying failures. However, their grounds differ. Martin disputes that a duty existed; Bekier disputes that he breached one. The wider AML-enforcement backdrop sits in our report on PAGCOR’s FATF-driven probity checks. Trade coverage of the Star proceedings, including AGBrief, tracks the appeals.

The Suncity AML Failures Behind It All

The appeals trace back to years of scrutiny. Multiple inquiries examined Star’s anti-money laundering controls, governance, and junket relationships. Suncity sat at the centre of that examination. It was Star’s high-risk international junket partner. Junkets channel VIP players and their money, which makes their AML controls critical. According to the findings, Star failed to adequately respond to known money laundering risks tied to Suncity. The China UnionPay card issue compounded it. Those cards were prohibited for gambling transactions, yet became a route for them. In March, Justice Lee found both Martin and Bekier had breached their Corporations Act duties. The June hearing set the penalties now under appeal. So the individual cases are the tail end of a much larger regulatory reckoning for Star. That reckoning reshaped Australian casino oversight. The lesson for operators is direct. Junket partnerships and payment-channel controls are where AML failures concentrate, and increasingly where personal liability follows. Similar junket and payment-risk supervision features in our report on South Korea’s proposed casino AML rules.

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This article has been thoroughly researched and reviewed by the CasinoBait editorial team to ensure accuracy and relevance for Asian casino players.