Star snubs NAB’s questions over $900m in ‘dodgy’ cash deals
NAB has kept Star Entertainment as a client, while removing its banker from the casino group’s account.
National Australia Bank sensationally removed the banker who oversaw the Star Entertainment account less than a week before a royal commission-style inquiry into the casino group began.
NAB removed the company from the client portfolio of its head of diversified industries Tanya Arthur last Friday after she had overseen Star’s account for more than three years.
The news came a day after the inquiry into Star’s suitability to hold a NSW casino licence, headed by Adam Bell SC, revealed that the company deliberately concealed almost $1bn worth of highly suspicious gambling transactions from law enforcement agencies, using a controversial debit card to flout anti-money laundering procedures.
The revelations raise serious questions about the conduct of Star executives who had knowledge of the suspicious transactions, as well as other entities informed about them, including NAB.
Asked why she was removed from Star’s account, Ms Arthur said: “A decision was made within NAB due to the basis of me being called as a witness to this inquiry that it was no longer appropriate for me to primarily be the relationship banker.”
NAB confirmed that Star continued to be a client.
Meanwhile, a former Star executive acknowledged misleading the bank about millions of dollars of “suspicious spending” on gambling.
All banks must complete what is known as “enhance customer due diligence” as part of their anti-money laundering and counter-terrorism financing programs.
“Carrying out ECDD allows you to decide whether a suspicious matter should be reported,” the financial crimes regulator Austrac says.
While Ms Arthur said NAB performed annual AML reviews of Star, the company failed to provide her with key details about its anti-laundering program, including its self-appointed AML compliance officers.
The company also created confusion between Ms Arthur and her NAB colleagues, who had differing views about Star’s ongoing relationship with junket operator Suncity, chaired by businessman Alvin Chau.
Ms Arthur’s evidence followed Star assistant treasurer Paulinka Dudek conceding the casino had misled NAB about the nature of cash withdrawals that were facilitated using a debit card known as China Union Pay – eventually queried by the bank.
Ms Arthur said nobody within NAB notified her that Union Pay cards were being used for gambling at the bank’s terminals at Star. This was despite the transactions raising eyebrows at China’s central bank, which said it had observed individual card holders spending more than $20m at Star and was “struggling to see how this level of expenditure could be made on non-gambling entertainment”.
Gambling is illegal in China and Union Pay cards cannot be used for that purpose. Ms Arthur acknowledged NAB risked a fine from China Union Pay if it was found its cards were being used to fund gambling.
“My understanding was that the same pay transactions were taken at the hotel and understanding was that the same pay transactions were taken at the hotel and they were transferred across to a patron account,” Ms Arthur said.
“And that patron account was an account that expenses both internally and externally were allocated through and the purchases on the China UnionPay card.
“My understanding was that the patron accounts included expenses both from within the resort itself relating to accommodation, restaurants, etc, in addition to external expenses, such as travel, jewellery, cars and other expenses that the patron incurred, whilst they were at the hotel. There was no mention of gambling.”
Ms Arthur added that when she queried Star, Ms Dudek told her there was no “gambling component” to these transactions.
Former Star treasurer Sarah Scopel told the inquiry on Friday that the company responded to NAB’s questions with misleading answers that made it look like the large spending transactions were not related to gaming and could have been for jewellery, cars, accommodation or cruises.
The inquiry resumes on Monday.