Tabcorp slapped with record fine by Victorian regulator for compliance failures following 2020 outage

Australian gambling company Tabcorp has incurred a substantial 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 significant fine is the result of Tabcorp's repeated non-compliance with directives issued by the regulator in the aftermath of an investigation into a system outage that occurred during the 2020 Spring Racing Carnival, according to a report by Business News Australia.

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

“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,” Commission chair Fran Thorn was quoted as saying in the report.

“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,” she added.

The investigation by the VGCCC originated from an incident on November 7, 2020, which was a pivotal race day. During this time, Tabcorp's Wagering and Betting System (WBS) experienced a substantial outage. Under the terms of its wagering and betting license for the WBS, Tabcorp is obligated to ensure the continuous availability of its system. The VGCCC's predecessor, the Victorian Commission for Gambling and Liquor Regulation, initiated an inquiry into the outage.

The imposition of this fine stems from directives issued after Tabcorp failed to voluntarily provide adequate 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 saidt.

The development comes after the company recently reported a net profit after tax (NPAT) of AUD 66.5 million ($42.7 million) in FY23, its first full year of operation following the demerger of the Lotteries and Keno business in June 2022.