Special manager’s report says Star ‘lacks expertise for remediation process’

A report from special manager Nicholas Weeks sent to regulators in October warned troubled casino operator Star Entertainment lacked the necessary expertise to reform itself.

Nicholas Weeks wrote in October that Star ‘was an organisation in many ways that resembled the organisation that was examined in the earlier inquiries’. Picture: John Feder

Troubled casino operator Star Entertainment Group was warned last year it lacked expertise to push through needed ­remediation.

A report from special manager Nicholas Weeks sent to both NSW and Queensland regulators in October came amid growing concern Star was not capable of reforming itself following a series of regulatory missteps.

The report, made public on Thursday by Queensland’s Office of Liquor and Gaming, came several months before the NSW Independent Casino Commission (NICC) announced a second inquiry by Adam Bell SC into Star’s suitability to keep its Sydney casino licence.

Mr Bell’s first inquiry resulted in the installation of Mr Weeks to run Star’s casinos in both Sydney and Queensland after he found breaches of money laundering rules and other misconduct. Mr Weeks wrote in October that Star “was an organisation in many ways that resembled the organisation that was examined in the earlier inquiries”. 

“While some directors and executives had departed, it has made little progress to quickly address adverse findings from the inquiries,” Mr Weeks said. “The Star did not appear to have an appreciation for the gravity of the conduct highlighted in the inquiries and the risks to which the casinos were exposed as a result. It was not proactive and displayed an absence of urgency in its approach.” 

Mr Weeks said several senior staff had departed and their roles were vacant on his arrival, while at lower levels, “the company was materially under-resourced, reflecting years of underinvestment in key risk and integrity related functions”.

“An absence of leadership, capability and resourcing meant the business was without ­effective oversight in its operations and without leadership in its attempts to deliver rapidly,” Mr Weeks said. “This exposed operations to a high level of risk and stifled The Star’s ability to commence its uplift in a meaningful and structured way. “While activity levels were high and a range of worthwhile, discrete tasks were being pursued in various areas, this work lacked cogency, structure and leadership.”

Mr Weeks said that nine of 12 direct reports to the chief executive Robbie Cooke were senior leaders in an “organisation that enabled a culture which cultivated and tolerated widespread misconduct”.

“The leadership team is not yet acting as a collective and has not authentically and clearly communicated a strong tone from the top in a unified way that will ignite enterprise-wide cultural change,” Mr Weeks wrote.

“It has underinvested in its capability in key supporting functions, including risk and integrity roles, for years. The Star has taken steps to address this historical ­underinvestment.”

“While some people management practices have improved, shortcomings continue to exist, and recruitment practices remain a source of frustration in the business and a barrier to capability uplift. Internal capacity in this function is low, which creates risk to execution of the remediation plan.”

Star is now pinning its hopes on new chief executive Steve McCann, who served as boss of Crown back in 2022, to help steer its remediation efforts.

Mr McCann is not the only Crown alumnus now working at Star. Star’s new chief operation officer Jeannie Mok previously served as chief transformation officer for Crown, which included designing and launching its transformation strategy and overseeing the delivery of its culture, governance, technology and operations remediation programs.

Mr Bell is due to report the findings of his second inquiry by the end of July.

Originally published as Special manager’s report says Star ‘lacks expertise for remediation process’