A VETERAN Victorian bookmaker accused of laundering drug money for a crime syndicate is still in business, despite facing serious criminal charges.

A legal loophole has left Victoria's gaming commission and racing authorities powerless to stop Peter Coster - who was charged with money laundering offences in June last year - running his bookmaking operation Doublebet.

Coster has appeared at major thoroughbred race meetings, as recently as last month, to operate his betting business. The money laundering case against Coster involves allegations he sold improperly issued winning betting tickets to a criminal syndicate seeking to launder $90,000 from the proceeds of amphetamine sales.

Racing industry sources called on Racing Minister Denis Napthine to move immediately to give regulators the power to suspend a gaming licensee provisionally until criminal charges are resolved in court.

The investigation into Coster's alleged conduct is one of the first tests of the racing integrity system, which was introduced by the former Labor government and involved previously rare co-operation between racing authorities and law enforcement agencies.