Star Entertainment unsuitable to hold casino licence in Queensland, given ‘one-eyed focus on profit’

The group misled the Queensland gaming regulator and its own banks over years as it disguised gambling transactions as hotel expenditure.

Star Entertainment has been deemed unsuitable to hold licences for its Brisbane and Gold Coast casinos after the release of a damning inquiry report that found it allowed money laundering to flourish with a “one-eyed focus on profit”.

The publicly listed gaming giant will be issued a show-cause notice on its Queensland operations less than a month after facing similar action in NSW, with the Bell Inquiry report also ­declaring Star unsuitable to hold the licence for its Sydney casino.

Attorney-General Shannon Fentiman, who on Thursday released the report of the Queensland inqiuiry headed by former Court of Appeal judge Robert Gotterson, said she was “pretty shocked by the behavior” of Star.

The report found the company misled the Queensland gaming regulator and its own banks over years as it disguised gambling transactions as hotel expenditure.

The money-laundering practice, which centred around Chinese gamblers and was also uncovered in its Sydney casino, is alleged to have involved at least $55m in Brisbane and the Gold Coast. Star will be given 21 days to respond to the show-cause notice and faces the likely appointment of a government “special manager” to hold the casino licences and oversee the gaming operations as it moves to open the $3.6bn Queen’s Wharf casino resort in Brisbane’s CBD next year.

Ms Fentiman would not speculate on whether Star would permanently lose its casino ­licence and conceded the state government had limited options because the only other comparable Australian casino operator, Crown, had faced similar findings of wrong-doing interstate.

“Star embarked on a program of literally having a one-eyed focus on profit,” she said.

“Not being truthful with the regulator, not taking their responsibilities around gambling harm and money-laundering as seriously as they should.

“(These are) pretty alarming and damning findings.”

The Palaszczuk government awarded Star in 2015 the rights to develop the Queen’s Wharf development in a joint venture with Hong Kong partners Chow Tai Fook and Far East Consortium.

Ms Fentiman said the findings could have implications on the development.

“Star are the major partner in the joint-venture agreement which have the casino licence for the Queen’s Wharf, so obviously a finding of unsuitability does of course have implications for the casino licence for Queen’s Wharf, but there is a show process to go through and then a range of options available to government,” she said.

“If Star are unsuitable to hold a licence, government will look at someone else to hold that licence.

“The recommendations, very sensibly from Mr Gotterson, would allow us to put in a special manager – that’s what we’ve seen in Victoria.”

In August, The Weekend Australian revealed that red flags were raised during the probity process for the awarding of the Queen’s Wharf contract, with government officials concerned about Chow Tai Fook’s links with Macau gambling boss Stanley Ho and his alleged triad connections.

The report made 12 recommendations, already accepted by government, which include an overhaul of gaming regulation laws, a doubling of the maximum penalty imposed on a ­casino to $100m and a move to limit cash transactions in casinos to $1000.

Mr Gotterson said Star had a poor corporate culture and was indifferent to the regulator.

“This all placed the Star Gold Coast and Treasury Brisbane casinos at real jeopardy of infiltration by persons about whom The Star had reason to suspect were likely to have been involved in criminality,” he said.

He said the terms of reference did not extend to the relationship between the government and Star after reports Labor-aligned lobbyists secretly worked for Star or revelations that the gaming giant had previously paid for a ­fundraiser for former attorney-general Yvette D’Ath at its Brisbane casino.

“What I think I was asked to do was forward-looking, getting The Star back to conforming with the laws regime and monitored so that will happen in the future,” he said.

“It didn’t have a focus on what happened in the past.”