Crown Melbourne inquiry reveals concerns about operator’s suitability as a casino licensee

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Adrian Finanzio, the counsel assisting the commission into the operator and licence, presented his arguments against Crown’s suitability as a licensee. He said that the Bergin Inquiry into Crown’s suitability to hold a licence in New South Wales revealed major flaws, and that – based on the evidence submitted to the Commission in Victoria – the operator remains an unsuitable licensee.

“As of 1 February, 2021, when the Bergin Report was published, Crown Melbourne was not a suitable licensee,” he said. “After all of the evidence presented in these hearings, it remains clear that Crown Melbourne is not presently suited to hold the casino licence.”

Finanzio continued by noting that Crown had submitted a plan for major reform, but questions – both over details of the plan and the likelihood it could be delivered – mean that a path to suitability was not clear.

“Notwithstanding the extensive programme of reform proposed by Crown, there remains a proper basis for concern about the detail of the plan, the capacity of Crown to implement it and the time it will take to deliver it, leaving the Commission to find that the programme of corporate rebirthing that Crown says is underway is insufficient and too uncertain to lead this Commission to the conclusion that there is a sufficiently clear path to suitability,” Finanzio added.

The failings Finanzio noted included serious breaches of anti-money laundering rules. Finanzio said he could not provide full details of these failings as this may exploit vulnerabilities in Crown’s AML processes. However, he said that it “is self evident that Crown has left itself wide open to exploitation by money launderers in the past, and that it will take some time to rectify that situation”.

The operator also put in place a system where VIP customers could purchase a voucher for chips at the Crown hotel, to be exchanged at the casino cage, which Finanzio said was “a way of circumventing currency restrictions from China”.

Furthermore, the operator was found to have underpaid its casino tax bill, despite Finanzio noting that it could have easily afforded to pay the full bill. It did this by subtracting certain bonus expenses from its gross gaming revenue figures.

Ultimately, Finanzio said that it was unclear whether Crown would ever be able to regain the public’s trust, and as this trust was a central consideration for licensing, this fact should play a major role in the Commission’s ultimate considerations.

“Standing at the centre of casino regulation in this state – and most jurisdictions across the world – is the expectation that the licensee should be someone who can create and maintain the confidence and trust of the public,” he said. “This is a case where misconduct has been so flagrant and so detrimental to Crown’s reputation that no amount of restructuring can restore confidence in it as a fit and proper person to hold a licence.

This is a case where Crown may well stand condemned in the public mind as unfit to hold a licence, whatever the circumstances, in the future. That itself is a factor worthy of consideration.”

Finanzio added that Crown Melbourne chief executive Xavier Walsh and group executive chairman Helen Coonan “cannot be the credible face of change at Crown if it is to remain the licensee”, as they had held senior positions during the period when failings occurred.

Since the Bergin report was published, Crown has been the subject of bids from both private equity giant Blackstone and rival Australian operator the Star. In May, however, Crown rejected Blackstone’s bid, which included a clause that would cancel the deal if any of Crown’s licenses were revoked or suspended.

The operator has also had to deal with the continuing effects of novel coronavirus (Covid-19) lockdowns in Australia. Last week, Crown Melbourne was again forced to close for five days due to an increase in cases in Victoria and concerns over the Delta variant of the virus. Crown Perth, however, was able to resume activity as measures were eased in Western Australia.

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Dawson Bennett is a seasoned journalist with over a decade of experience covering the casino and sports industries. His extensive knowledge of these sectors makes him a trusted expert for readers seeking advice and insights. Whether you're looking for the latest developments in the sports or gambling world, Dawson provides valuable guidance to help you make informed decisions. He offers tips on selecting high-quality casinos and stays on top of trends and events in the sports industry, ensuring you have the best possible experience.
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