The real danger of the royal commission into Crown Resorts’ suitability to hold a casino licence in Victoria is whether it reveals any startling new information about the company that has not been aired already.
Will former Federal Court judge Ray Finkelstein take a narrow approach to the terms of reference and focus mainly on the issues already aired before former NSW Supreme Court judge Patricia Bergin, which resulted in her damning report this month?
Or could the Finkelstein royal commission produce new witnesses and reveal any new goings on at Crown’s casino in Melbourne that have not yet emerged, which would then in turn have to be reviewed by regulators in NSW and Western Australia, where Crown also operates?
And what, if any, impact does the announcement of another body with royal commission powers have on regulators in Britain, where Crown owns the upmarket Aspinalls club in Mayfair?
Will Crown’s major shareholder, James Packer, be asked to appear again?
In announcing the inquiry on Monday, the Victorian government has made it clear that its inquiry is in response to the results of the 800-page Bergin report.
The report has been an embarrassment for the Victorian government, which has emerged as having apparently weak regulatory oversight of Crown — which is a major employer in the state and a significant source of revenue.
How can an inquiry in NSW find Crown not suitable to hold a licence in the state based on events that largely took place in Victoria, and decisions supervised by Crown’s long-term executives?
At the very least it could recommend a regime of tighter regulatory control over Crown in Melbourne, following the recommendations of the Bergin inquiry that include the banning of junkets and the reporting of potential money-laundering activities to the state gaming regulator, as well as the federal anti-money-laundering regulator Austrac.
The terms of reference for the Finkelstein royal commission are still, potentially, much more open ended. They ask the former judge to look into whether Crown is a “suitable” company to hold a casino licence in Victoria, whether it is complying with the Casino Control Act and other legislation in Victoria, and “whether it is in the public interest for Crown Melbourne to hold the casino licence” in the state.
The tight timetable given for Finkelstein to report (August 1) would indicate that he could take a narrow approach to the subject, possibly confining himself to the issues already reviewed by Bergin in her year-long inquiry last year.
But royal commissions have a history of following some unexpected paths, and of producing some unexpected information and revelations.
Finkelstein will not want to oversee an inquiry that appears to just rubber stamp the recent NSW review.
Is Crown now vulnerable to anyone with a grudge against it who could come forward with new information?
And how far back will the inquiry go? Particularly given that the Bergin inquiry went back at least until the lead-up to the arrest of 18 Crown employees in China in 2016.
Or will Finkelstein tread a narrow path by only calling the same witnesses who appeared before the Bergin inquiry?
In one sense, the Victorian probe is overdue, given the toughness of the state’s regulator has been called into question by the findings of the Bergin inquiry.
Just bringing forward the closed-door, five-year license review by the Victorian regulator was not going satisfy the perception that the state was not tough enough in its regulation of Crown.
Crown executive chair and former federal senator Helen Coonan — an ex-barrister who is facing the challenge of her life juggling regulators and inquiries in three different states — said she welcomed the Victorian inquiry as a chance to show how Crown has been reforming itself.
The inquiry, she said, was an “opportunity to detail the reforms and changes to our business to deliver the highest standards of governance and compliance and an organisation culture that meets community expectations”.
“Victorians should be assured that we recognise the responsibility placed on us by the community, governments and regulators and we will fully co-operate with the royal commission,” she said
Under her chairmanship, directors and executives who were the subject of critical comment by the Bergin inquiry have all left the company — a fact she can easily point out to Finkelstein.
In other words, a fair bit of house cleaning at Crown has already occurred.
Coonan has brought many changes to the company and is overseeing more of them. But just where will this new inquiry go?
Could it go back further in time than the Bergin inquiry?
Countering the potentially broad terms of reference for the inquiry are other more restrictive terms that also direct the royal commissioner to conduct the investigation “without incurring unnecessary cost or delay”, “without prejudicing the regulatory review” — and “in a way that does not prejudice any current or future criminal proceedings”.
But in any royal commission, it is always open to the commissioner to ask for an extension of time.
At the least, the announcement of a royal commission in Victoria — where Crown has it biggest single operation and has operated for decades — will prolong the uncertainty for the company, its staff and Crown shareholders.
NSW regulator ILGA, in particular — which is currently in discussions with Crown about ways it can reform itself so the company can be suitable to hold a licence in NSW — will not sit idly by if some negative revelations come out of the Victorian inquiry.
Indeed, ILGA may well be tempted to wait even longer before it allows Crown to open its casino doors at its $2.2bn Barangaroo development.
Crown had been hoping to open the doors to its gaming floors in December last year. But as the months tick by — and with ILGA still talking with Coonan — chair Phil Crawford could decide to wait until August.
If James Packer is looking to sell some or all of his 37 per cent shareholding in Crown, as he has indicated, it will further delay any potential deal, with potential buyers wanting to assess the regulatory environment in which it will operate into the future.
The Crown saga still has a long way to go.
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