AGCO Fines NorthStar $100K for Failing to Apply Anti-Money Laundering Controls

The Alcohol and Gaming Commission of Ontario (AGCO) has issued a $100,000 fine against NorthStar Gaming (Ontario) Inc., the operator of NorthStarBets.ca, for failing to comply with provincial anti-money laundering requirements. The enforcement action follows an investigation into betting activity by an individual charged in connection with Project Outsource, a joint law enforcement initiative targeting criminal activity in Ontario's towing industry.

The case centers on a player who opened an account with NorthStar in March 2024 and immediately crossed the operator's $25,000 lifetime deposit threshold in the same month. According to the AGCO's investigation, this player continued depositing funds over more than a year, with particularly large activity in December 2024 (a $55,000 deposit) and reaching a cumulative total of $189,395 by June 2025. Despite NorthStar's own AML policies explicitly identifying the player's disclosed occupation as high-risk and mandating Enhanced Due Diligence (EDD) once the $25,000 threshold was breached, the operator failed to apply these controls. The company's procedures also required escalating actions when money laundering risk indicators emerged, including the authority to refuse transactions.

NorthStar did not classify the account as high-risk or terminate it until June 2025, after direct inquiries from the AGCO. This 15-month gap between the triggering of AML obligations and compliance action represents a significant regulatory failure. Dr. Karin Schnarr, AGCO's registrar and CEO, emphasized that operators must function as the first line of defense against criminal activity: "Anti-money laundering controls must be more than policies on paper. When risk indicators are triggered, operators are required to take active steps to help protect Ontario's regulated gaming sector from being misused for criminal activity."

NorthStar Gaming Holdings Inc. has accepted the regulatory findings and indicated it will not pursue an appeal to the independent Licence Appeal Tribunal, which was available within 15 days of the penalty notice. The company's leadership acknowledged the violation, with CEO Corey Goodman stating: "We take our AML obligations seriously, and we accept responsibility for the matters identified in this order." NorthStar indicated that the problematic conduct was confined to a specific historical period and has since made substantial investments in its compliance infrastructure, including appointing a new vice president of compliance, expanding compliance staff, and completing an independent external compliance effectiveness review.

This enforcement action reflects broader regulatory pressure on Ontario's iGaming sector to strengthen AML frameworks. As of August 2026, Ontario has licensed 48 online gaming operators, and the AGCO has made clear that paper policies without active enforcement carry no regulatory weight. The NorthStar case demonstrates that regulators are prepared to penalize operators who fail to act on their own stated risk protocols, particularly when those failures may facilitate the movement of proceeds from serious criminal activity. For industry participants, the fine underscores that compliance investments must translate into real operational discipline, not merely procedural documentation.