Revealed: Star casino's ex-lawyer, the 'crime' figure and the hotel deal

When Australia's wealthy Zagame family decided to offload their Vanuatu casino resort in 2017, a seemingly promising purchaser emerged. On paper, Sunny Red Operations Limited looked impressive because its Australian arm was directed by casino industry heavyweight Michael Anderson.

Anderson was the former chief lawyer at Sydney casino The Star. He'd also been appointed to run the casino legal division of Star's parent company, Tabcorp, when it owned several Australian casinos.

And in 2009, after helping Star re-negotiate its tax and casino licence with the NSW government, Anderson was named the Australian Corporate Lawyer of the Year.

Michael Anderson.

Anderson used the publicity to launch his own private firm in 2012 and began consulting to the gaming and defence industries. In interviews, he has taken credit for reforming the NSW Casino Control Act to reduce red tape without compromising the integrity of the casino industry.

As one party to the Vanuatu deal told The Age and the The Sydney Morning Herald, Anderson was the ideal candidate to help take over an offshore casino.

At first all seemed to be going smoothly with the estimated $25 million deal. In May 2019, Sunny Red placed advertisements saying it was set to launch “a super high-end world-class casino in Vanuatu” and required staff with "absolute loyalty to the company" and "good looks".

But Anderson was only a director of Sunny Red Operations and his firm, Elite Legal, was merely the Australian agent. One clue as to who was ultimately behind the flashy Vanuatu venture lay in Anderson's fellow Sunny Red director, a 27-year-old Chinese-Australian called Jin Zhou.

Zhou's father is Melbourne suspected crime figure and casino high-roller agent Tom "Mr Chinatown" Zhou.

Until his arrest earlier this year, Zhou snr was an international fugitive who had gained infamy due to his dealings with organised criminals and Chinese Communist Party influence networks in Melbourne, as well as his deep ties to gaming giant Crown Resorts.

Moving offshore

In 2017, Zhou snr was attracting increasing law enforcement attention in China and Australia. He began telling associates (who spoke to The Age and The Sydney Morning Herald on condition of anonymity) that the Grand Hotel and Casino Resort in Vanuatu was the perfect place to shift his Melbourne operations.

The Grand Hotel & Casino, Vanuatu.

Built in 2003, the eight-level hotel overlooks the Port Vila harbour and features 15 gaming tables, 136 slot machines, a VIP top-floor gaming room, a restaurant, conference rooms, four bars, a pool and a spa. For Zhou, the casino seemed an ideal place for a new start. He hoped that there he could operate with minimal oversight.

It turned out that was not possible. Zhou snr's powerful backers, who included the the cousin of President Xi Jinping, Ming Chai, were themselves attracting attention from security agencies concerned about the Chinese government's attempts to seed influence in the South Pacific. Flight records show that on a trip to Vanuatu to scope its casinos in late 2017, Zhou snr was accompanied by Ming. And a source close to the casino purchase deal has claimed that, when the Vanuatu venture foundered late last year, a plot was hatched to bribe Vanuatu’s Prime Minister.

Exactly how Mr Anderson became involved in the casino deal is a mystery. It is one the high profile Sydney lawyer is, for the time being, not keen to help solve - he has not responded to multiple efforts to contact him.

There is no evidence that Mr Anderson has been involved in or knew about any wrongdoing or that he even knew that Zhou snr maintained ultimate control of the business which Mr Anderson directed alongside Zhou snr's son.

But it was not the first business dealing connected to Zhou that the Sydney legal figure has facilitated as a solicitor. Property records show that Mr Anderson was the lawyer who, in April 2019, helped one of Tom Zhou's high-roller associates place a caveat on a Melbourne house, presumably to help recover a debt. The house is owned by a drug trafficker.

Multiple inquiries

The revelations about a respected Sydney lawyer's dealings with the company directed by a child of Tom Zhou come at an acutely sensitive time for the casino industry. A major inquiry headed by former judge Patricia Bergin is examining links between Australian casinos and suspected organised crime figures.

The Bergin inquiry, along with several other state and federal inquiries, were launched after The Age, the Herald and 60 Minutes exposed Zhou snr’s dealings with Crown, which runs Melbourne’s only casino and is building Sydney’s second casino at Barangaroo.

One strand of Ms Bergin's inquiry concerns how much vetting a casino and its lawyers must do before they partner with high-roller agents - known as junkets - such as Tom Zhou. Vetting is required because junkets are notorious for being controlled by Asian organised crime groups known as the triads. Junkets are paid by casinos to lure high-rollers through their doors, an arrangement the Australian Criminal Intelligence Commission recently warned is facilitating large scale money laundering.

Zhou's junket business in Melbourne made tens of millions of dollars by striking partnerships not only with Crown, but other casino firms across the nation. This is despite the fact that Chinese court records from 2012 and 2013 reveal Zhou's alleged involvement in organised crime activity. He has been accused in various Chinese courts of extortion, standover tactics, arranging for acid to be thrown in a man’s face and fleeing China in 2013.

Zhou snr’s multi-million dollar gambling empire in Australia began collapsing last year due to media attention and intensive investigations by the Australian Criminal Intelligence Commission. ASIO has separately been tracking figures such as Zhou, who maintained close connections to powerful Chinese Communist Party figures despite his criminal past.

In Australia, Zhou set up a network of Chinese Communist Party influence organisations under the auspice of the Chinese Communist Party’s United Front operation and supported by the Chinese consulate in Melbourne, even though he was subject to a long-standing Interpol red notice.

According to court files and briefings from local and overseas security sources, Zhou also allegedly operated with the triads - the Chinese organised crime groups which run not only junkets but money laundering, human and drug trafficking rackets in Australia and Asia.

Over the last decade, the triads have also been moving into South Pacific nations and security analysts are tracking if they are doing so with the tacit support of Chinese government agencies. One phenomenon noted recently by security officials in Australia is the use of Vanuatu passports by both Chinese criminals and government influence agents.

Tom Zhou and Ming Chai.

Vanuatu visit

In September 2017, Zhou and President Xi's cousin Chai (who has also faced corruption allegations, though he has never been charged) flew to Vanuatu on their private jet escorted by an off-duty Australian Border Force officer, Andrew Ure, who was moonlighting as a security agent.

The flight to Vanuatu would ultimately trigger a range of inquiries by Australian agencies, including one into why a border force agent was running security for an alleged crime boss and the Chinese President's nephew.

Though Zhou snr's name does not appear on the paperwork of Sunny Red, the firm that would buy the casino resort, sources say he made no secret in Melbourne's Chinese business community that he was behind the South Pacific venture.

Soon, word of that fact reached Vanuatu police. Sources in Vanuatu and Australia with knowledge of the deal say it collapsed in mid 2019, after Vanuatu police and gaming authorities were tipped off by Interpol that Zhou was wanted for serious financial crime in China.

The concern about allowing someone like Zhou snr to operate in Vanuatu was obvious. A Port Vila casino would have allowed him to bring huge amounts of money and thousands of people to Vanuatu and to run a shadow banking operation with minimal oversight.

A source who had direct dealings with a businessman hired by Zhou to facilitate the deal said that Zhou and several Melbourne associates made multiple panicked trips to Vanuatu in late 2019, hoping to resurrect the deal. The source said those associates made payments to undisclosed third parties to secure meetings with Vanuatu officials in late 2019.

The source, who has reported his allegations to Australian authorities, said Zhou's associates also planned to bribe the Vanuatu Prime Minister Charlot Salwai after the casino licence was blocked. The businessman accused of bribery refused to answer questions when contacted.

The source said the payments were not ultimately made. This was because Zhou's life was dramatically unravelling. In late 2019, he was detained briefly in Vanuatu. He then fled to Japan and onto Fiji, where he was detained again and sent back to China to face financial crime charges he had first fled in around 2011.

Says one source of Zhou snr: "He became too cocky. He thought he could get away with anything."