Crown Resorts in last ditch effort to open Sydney casino; will cut ties with junket operators

Crown Resorts appears willing to negotiate limited opening for the $2bn Sydney Barangaroo Casino.

Crown says it will drop ties with gambling junket operators. Picture: Steven Saphore

Crown Resorts will on Wednesday make a last-ditch effort to open Sydney’s Barangaroo Casino on time by proposing that the $2bn casino resort has a limited opening.

On an agenda for the Wednesday meeting of the NSW Independent Liquor and Gaming Authority released late on Tuesday under the item “other business” includes a submission by Crown for “limited opening of Casino operations.”

The meeting of the NSW gaming regulator was set to determine whether Crown would be able to push ahead with the planned December 14 opening of Barangaroo before an ILGA inquiry into the company’s suitability to operate the venue reports next February.

It is understood the proposal to ILGA was put by Crown in the past fortnight after concerns about the opening were raised by NSW Premier Gladys Berejiklian.

It is believed to include limits on the tables available and on the number of patrons allowed to enter the facility.

A Crown spokesman declined to comment.

Last month the commissioner of the inquiry Patricia Bergin openly questioned the “good sense” of opening the venue before she had determined whether the company was suitable.

Earlier on Tuesday, in a bid to save its licence to operate Sydney’s Barangaroo casino, Crown Resorts pledged to permanently suspend all dealing with “junket operators” — also known as gambling promoters who arrange tours for VIP gamblers to its Australian casinos — unless all state gambling regulators approve them.

Junkets are not currently licensed in any state and the NSW inquiry into the licensing of Crown’s Barangaroo casino is consideringrecommending the creation of a new regimen to regulate them.

The announcement on Tuesday came moments before the company’s legal team fronted a NSW Inquiry to explain why its past dealings with junket operators, some of which have alleged links to organised crime, should not deem it “unsuitable” to operate the Sydney Barangaroo Casino.

In a release to the ASX Crown said that the consultation process with the different state gaming regulators on the ban is already underway.

“The board has determined that Crown will permanently cease dealing with all junket operators, subject to consultation with gaming regulators in Victoria, Western Australia and New South Wales,” the announcement said.

“Crown will only recommence dealing with a junket operator if that junket operator is licensed or otherwise approved or sanctioned by all gaming regulators in the States in which Crown operates.

“The consultation process with Crown’s gaming regulators in Victoria, Western Australia and New South Wales has commenced.”

At the NSW inquiry into the licensing of Crown’s Barangaroo casino, Crown’s counsel Perry Herzfeld SC told Commissioner Patrica Bergin that the decision should have bearing on the inquiry’s findings.

“Now that is obviously a very significant development in the inquiry’s consideration of Crown’s present suitability arising from the junkets topic,” he said.

Mr Herzfeld said that although “Crown’s due diligence with respect to junkets have evolved and improved over time,” the company accepts that in the past there have been shortcomings in the approval process.

“Crown accepts that there have been shortcomings in its junket due diligence processes,” he said.

“Crown also accepts that in their most recent form, those processes do not always eliminate all risks associated with junkets.”

In September Crown announced it would suspend its dealing with junket operators until June 30, 2021 after the NSW inquiry detailed the many alleged links of Macau and Hong Kong based junkets Crown used to organised crime groups and money laundering operations.

In one instance the inquiry heard that financial crimes regulator Austrac in 2017 emailed the company asking for justification for its ongoing association with the head of the Sun City junket, who was considered a “politically exposed” person due to his well-reported links to Triad gangs in Asia.

It also heard that Crown received numerous due diligence reports on junket identities detailing alleged links to organised crime.

That same junket operator, Sun City Group, had a private room at Crown Melbourne where it would operate its own tables and cash desk, until last year.

Crown banned the use of the cash desk in the room in 2018 after it was revealed that $5.6m in cash was found at the desk, raising money laundering concerns.

Last month Crown chairman Helen Coonan conceded that the company’s assertion in response to media speculation last year that they had a “robust” junket vetting process was not the right choice of words.

But Mr Herzfeld said the process was rather “not not robust,” that Ms Coonan’s opinions were not shared by all directors on the Crown board, and that the new junket policy was not an admission that the prior policy was “not robust.”

Ms Bergin interjected to say this kind of argument was not helpful to Crown.

“I don’t see how this can assist you; you see this is a suitability process for the purpose of identifying willingness to co-operate,“ she said.

“I don’t see how this can assist you, to take me to all the directors’ resistance to the suggestions Ms Coonan came to very promptly … it just doesn’t help you.

Ms Bergin said that Ms Coonan‘s concession was “exquisitely appropriate” given the aims of the inquiry.

“What I’m looking for is true commitment. True commitment,” Ms Bergin said.