The State Premier of Victoria, Daniel Andrews, has announced a royal commission to evaluate whether Crown Melbourne should retain its Victorian license to operate its flagship casino and entertainment resort. The commission will also assess the suitability of Crown Resorts Ltd., the owner of Crown Melbourne. Simultaneously, the Victorian government is establishing an independent casino regulator, led by Minister for Consumer Affairs, Gaming and Liquor Regulation Melissa Horne. The regulator will provide recommendations on necessary structural and governance arrangements.
This decision follows the findings of the New South Wales Independent Liquor and Gaming Authority (ILGA) inquiry into Crown Resorts. As a result of the inquiry, Crown Resorts’ CEO, Ken Barton, recently resigned. Taking advice from the ILGA inquiry, the Victorian government aims to proceed in the most appropriate manner. The royal commission, chaired by Raymond Finkelstein QC, will possess the authority to compel witnesses and documentation. Its recommendations are expected by 1 August 2021. The government plans to enact legislation, based on the commission’s findings, to empower the Victorian Gaming and Liquor Regulation Commission (VCGLR) to take necessary actions.
“Our goal is to ensure that casino license holders in Victoria adhere to the highest standards of probity and integrity and are held accountable for their actions,” stated Premier Andrews. In addition to the royal commission, an independent review will run alongside it. This review will evaluate, among other topics, the regulations for combating money laundering and overseeing junket operations.
Minister Horne commented, “The reports from the ILGA inquiry in New South Wales were deeply troubling, which is why we are implementing a royal commission to obtain the necessary answers regarding Crown Melbourne. The commission’s investigation will establish the facts, and the government and VCGLR will take appropriate action once it concludes. Illegal behavior will not be tolerated in our gaming industry.”
Ken Barton’s resignation followed the New South Wales inquiry’s finding that Crown Resorts was “unsuitable” to operate a casino in Sydney’s Barangaroo area. The inquiry discovered evidence of money laundering and inadequate due diligence regarding junkets with alleged criminal connections. The inquiry report criticized Crown Resorts for its “unjustified belief in itself” and “corporate arrogance,” which led to a lack of thorough investigation into serious claims against the company.
The New South Wales inquiry was initiated when Asian gaming giant Melco agreed to acquire a 19.99% stake in CPH Crown Holdings in May 2019 for approximately AUD$1.76bn (£981.9m/€1.06bn/US$1.19bn). Although Melco ultimately withdrew from the acquisition, the inquiry persisted, with its findings released in early February. Subsequently, further resignations were announced alongside Crown Resorts’ half-year financial results, which revealed a 62.1% decrease in revenue.
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