The Star casino high rollers in court battle over $3m in gambling ‘loans’

Two high rollers faced off in court over almost $3 million in loans when they were gambling at The Star casino in Sydney. And one of them lost big.

Two high rolling gamblers rolled the dice in a court battle over almost $3 million in loans — but only one came away the winner.

On one side was Epping-based casino junket operator Xiogming Xie.

His big-spending client Wenxin Chen was on the other.

Both men claimed the other owed them more than $1 million thanks to two separate loans they claimed to have made to each other in 2018 and 2019 respectively.

But their case in the NSW Supreme Court saw Justice Stephen Campbell provide a warning to big gamblers everywhere — if you’re going to call in a gambling loan make sure it is legally enforceable.

Chen launched legal action against Xie in March 2020.

In his statement of claim, Chen alleged he lent Xie $1 million when the two were gambling at The Star on December 18, 2018, which Xie failed to repay — plus 15 per cent interest — by the due date one year later.

In his defence statement, Xie hit back with his own allegation that Chen was actually in debt to him to the tune of more than $1.5 million in gambling loans.

The men were gambling at The Star when they made the deal for the loans.

Xie claimed that on January 10, 2019, when the pair were again at The Star, he lent Chen $300,000 worth of casino chips on the agreement that he would repay five times their worth.

The court heard that when Xie pursued his associate for the money on January 29, 2019, Chen wrote to him explaining that he could not repay him.

“Can only use the borrowed $1 million to offset,” he wrote.

The court heard that one key piece of evidence that sunk Xie’s case were a series of text messages between him, Chen and another man relating to the alleged loan of $300,000 in casino chips.

One read: “Boss/Chief Chen, to bet 60 thousand of chip on the table, equals to … 600 thousand Renminbi. For winning of 60 thousand, the company needs to pay 600 thousand Renminbi. For losing of 60 thousand, Boss/Chief Chen needs to pay the company 600 thousand Renminbi.”

The casino gambling loan debacle ended up court.

Chen’s lawyers argued that this created a fatal problem for Xie’s case. They told the court he was effectively engaging in illegal gambling — not sanctioned by the casino — with Chen rather than lending him money.

Justice Campbell told the court that Xie was engaging in illegal gambling. This meant Xie had no legal recourse to reclaim his money.

“I am of the view that the law of restitution cannot be invoked by the first defendant to recover even the stake, let alone the winnings which he seeks to set-off against the debt due to the plaintiff,” Justice Campbell told the court.

“In this circumstance the loss must lie where it falls.”

Even worse for Xie, Justice Campbell found that Chen’s loan to him was legal and must be repaid, with interest — and he needed to pick up the tab for Chen’s lawyers.