Probe into Crown Sydney casino license suitability finds transparency issues

The head of an inquiry assessing Crown Resorts’ suitability to operate a casino in Sydney criticized the state of the Australian company’s anti-money laundering systems and said a lack of transparency exposed by the probe was a “debacle,” Bloomberg reports.

The inquiry was set up last year after media reports that criminal gangs laundered money at Crown’s casinos, and the company used junket operators with links to drug traffickers. Retired Supreme Court Judge Patricia Bergin, overseeing the probe, must consider whether Crown is worthy of keeping its license for a planned Sydney resort in Barangaroo, due to open in December.

Crown Chief Executive Officer Kenneth Barton, who gave evidence for much of Wednesday, said the company hadn’t yet fully reviewed the specific accounts that were allegedly used by money launderers. Crown’s CFO before he became CEO this year, he also said that for several years after 2014 he didn’t know a major junket operator had a cash desk at Crown’s flagship Melbourne casino. Barton said such an arrangement “certainly” posed a money-laundering risk. “There has to be some more transparency because this, in effect, has really reached the debacle level,” Bergin said Wednesday. “At the moment it is just extraordinarily troubling.”

Ultimately, Bergin will determine if Crown should keep its license, or make governance changes, in order to run a A$2.2 billion ($1.5 billion) Sydney harborside gaming development. Crown’s billionaire shareholder James Packer, who has championed the project for almost a decade, is due to give evidence next week, along with all the directors.

On Wednesday, Bergin questioned how any regulator could know what was happening at Crown when Barton himself was unaware of the details. “This is what is troubling me,” she said. The inquiry also heard that Barton, replying to a question from a shareholder at Crown’s 2019 annual meeting, withheld details of his own almost daily communications about Crown’s financial performance with Packer, which were permitted under a controlling shareholder protocol.

The inquiry was initially sparked when Packer made a deal to sell 19.99% of Crown to Macau-based casino operator Laurence Ho and Melco Crown. That deal has now fallen over, but the inquiry has continued after the Nine media group aired serious allegations of money laundering, prostitution, and the involvement of organised crime in the high-roller rooms of Crown’s Australian casinos. Crown has called last year’s media reports part of a “deceitful campaign” that sought to damage its reputation. Crown has said it will work with regulators on any recommendations.