Crown’s Poynton willing to declare his independence as WA inquiry looms

The board member who last week cut ties with James Packer has won support from influential shareholder Perpetual.

Sydney's Crown Casino at Barangaroo Picture: NCA NewsWire/Flavio Brancaleone

Crown Resorts director John Poynton has offered an olive branch to the NSW gaming regulator after it declared it would investigate his independence following the Perth businessman’s move last week to severe ties with Crown’s major shareholder James Packer and remain on the embattled gaming company’s board as an independent director.

NSW Independent Liquor and Gaming Authority chairman Philip Crawford last Friday said he would assess Mr Poynton’s decision to remain on the Crown board, amid concerns that his consultancy agreement with Mr Packer’s Consolidated Press could undermine his independence.

“I am happy to engage with the regulator on this issue, anytime,’’ Mr Poynton told The Australian on Tuesday when asked about Mr Crawford’s position.

As the only WA-based director of Crown, Mr Poynton’s independence and conduct will also come under scrutiny if the state government proceeds with its own inquiry into the company’s suitability to operate Crown Perth, which was endorsed by the WA Gaming and Wagering Commission on Tuesday night.

The Australian understands Crown’s biggest institutional shareholder, Perpetual, is supportive of Mr Poynton remaining on the board and has no issues with his independence from Mr Packer.

However Perpetual continues to believe long-serving Victorian-based director Harold Mitchell should step down.

Mr Mitchell and the directors remaining on the Crown board following a string of resignations last week will meet on Wednesday to discuss the company’s interim results before they are released to the market on Thursday.

The board will also ratify the remuneration package for new executive chairman Helen Coonan, which is speculated to be as much as $3 million a year. She will present Crown’s results on Thursday alongside chief financial officer Alan McGregor.

Meanwhile Crown faces new pressure on its western front with Western Australia’s Gaming and Wagering Commission meeting to receive information on the landmark Bergin report from the state solicitor.

When asked if the Perth casino licence could be put out to tender, Western Australian Premier Mark McGowan, who is campaigning for the state election, on Tuesday told reporters “all those things could be out there. Obviously there are propriety issues”.

On Tuesday Crown confirmed discussions with ILGA had formally begun, as stipulated under the terms of their restricted gaming license in NSW.

Crown director John Poynton. Picture: AAP

“ILGA has commenced the consultation process contemplated under the VIP GMA and has invited Crown Sydney Gaming to address ILGA in relation to its present view,” Crown said in a statement.

The ILGA board will convene in Parramatta on Wednesday for its regular monthly meeting, where it is set to spend the day discussing routine regulatory and approval matters.

Meanwhile ILGA is yet to consider whether to refer former Crown Resorts chairman Robert Rankin to the corporate regulator for investigation after he failed to appear in front of the Bergin inquiry to justify alleged breaches of his duties as a company director.

Mr Rankin, who was chairman of Crown from August 2015 to January 2016 and then a non-executive director to June 2017, noticeably refused to appear in front of the NSW inquiry into Crown last year from his home in the UK, with a lawyer stating he intended to be in Europe for a significant amount of time.

Mr Rankin’s failure to appear was notable: his tenure at the company overlapped with one of the key focuses of the inquiry – the 2016 arrest of 19 Crown staff in China for illegally promoting gambling.

The former Deutsche Bank and UBS Investment Banker was heavily involved in Crown’s China business and was admonished by Mr Packer during the inquiry for letting “the side down” by failing to correctly manage the risks the China staff faced.

Mr Rankin was also criticised for knowing about serious threats Mr Packer made to private equity figure Ben Gray in 2015 over email but failing to report them to his fellow directors.

For these reasons, counsel assisting the inquiry Scott Aspinall recommended inquiry chief Patricia Bergin recommend Mr Rankin be referred to the Australian Securities & Investment Commission for “possible breaches of section 180 of the Corporations Act 2001”.

In the report, Ms Bergin said “the elusive Mr Rankin’s” time as chair was “clearly lacklustre” and criticised his “inexplicable” failure to report Mr Packer’s threats to his fellow directors.

But she did not recommend referring him to ASIC, saying it was outside of the terms of references and a matter for the NSW Gaming Regulator.

“The authority is of course able to exercise its own powers of referral to any agency it deems appropriate “in the exercise of functions” under the legislation,” she wrote.

The Australian understands that although ASIC is not required in any way to responded to the contents of the Bergin report, it is reading it with great interest.

ILGA chair Mr Crawford told The Australian that the regulator was yet to consider the issue of Mr Rankin, who has worked in an advisory capacity for several funds after stepping down as chair of Sargon Capital last year, shortly before it entered receivership.

“We will consider this at some future time,” he said, adding that the regulator’s more immediate priority was entering into discussions with Crown about ways it could regain its licence to operate Sydney’s Barangaroo casino.

Shares in Crown Resorts closed at $9.76, down 2.1 per cent.