After more than eight hours of painful interrogation over three days back in early October, James Packer was asked for only a matter of minutes about an issue which has put a dark cloud over his casino company’s suitability to fulfill his Sydney casino dream.
In that brief exchange with inquiry commissioner Patricia Bergin, Packer revealed he had first heard about two Crown shelf accounts, Southbank and Riverbank Investments, during the course of her public inquiry into the casino company.
He added that he was never informed about their structure and agreed that as a former chairman, he would be sensitive to ensuring that money laundering never occurred in its operations.
So amid all the criticism of the billionaire over 11 months of public hearings into his and Crown’s suitability to retain its Sydney casino licence, it would have been truly galling for him to hear in the inquiry’s final hours this week of the company’s spectacular admission that money laundering probably occurred in those accounts.
Worse was the revelation that Crown had been told by one of its senior executives last year to investigate the issue and on legal advice, deliberately shut it down. As Bergin’s Counsel Assisting put it during the final day of the inquiry’s public hearings, it was worse than turning a blind eye.
Bergin herself said the failure of Crown to reveal that fact back in February took the inquiry off on a significant and costly tangent for the NSW taxpayer.
It smacked of behaviour and a culture that went directly to the consideration of Crown’s suitability to be a close associate of the Sydney licence.
After all the questions raised in recent months about the influence of Packer on Crown, the conflicts of interests of his executives on the Crown board and the failures of the company’s risk management and governance, it is this issue which has derailed its defence.
It was seized upon by ILGA chairman Philip Crawford on Wednesday as underpinning its decision to postpone the opening of Crown Sydney until the findings are released on February 1.
The fact that no written evidence can now be found detailing Minter Ellison’s analysis which informed its advice to Crown on money laundering is stunning.
It raises serious questions about what was contained in the verbal evidence given by the legal firm to the company. Were any of the directors ever informed of this advice? Bergin never got the chance to ask them during their evidence because she never knew about it.
Will she be forced to recall them or Minter Ellison itself? Or Crown’s former legal boss Joshua Preston, who made the decision to accept Minter’s advice? Or Crown chief executive Ken Barton, who sparked the scandal in his sixth statement to the inquiry late on Tuesday evening.
This week he agreed with ANZ’s assertions that Crown’s communications with the bank over the Southbank and Riverbank accounts revealed “failures” and “very serious issues” after previously rejecting the assertions.
On Friday it was also claimed he was informed on September 9 this year of former AML general manager Louise Lane’s request last August for a full review of the accounts, but he did not inform the inquiry until this week.
Will Crown’s investors now call for Barton to stand down?
It would be a terrible outcome for Barton, who with his chairman, has admirably led the charge to reform Crown’s governance and structures this year.
But Crown’s own-goals in the week it finally had the opportunity to show it had righted the wrongs of the past have been breathtaking. There will be consequences.
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