Victoria hits Crown Casino with $1m fine for junkets

The casino operator has been caught out for failing to comply with rules regarding controversial international gambling tour organisers.

Crown Resorts has been fined $1m by the Victorian gambling regulator for failing to comply with rules regarding controversial international gambling tour organisers – or junkets.

In a statement released late Tuesday the Victorian Commission for Gambling and Liquor Regulation said it had issued the fine – the maximum penalty available under the state’s Casino Control Act – after an investigation that began last October when links between money laundering activity and junkets operating at Crown Melbourne was detailed at the NSW Bergin inquiry into the company.

At the time the VCGLR issued Crown Melbourne with a notice to show cause why the gambling company should not be disciplined over its dealings with junket players linked to organised crime and allegedly involved in money laundering.

But the regulator said on Tuesday its investigation had concluded that Crown “failed to comply with its regulatory obligations during relevant periods, namely, obligations that required Crown to implement a robust process to consider the ongoing probity of junket entities.”

The VCGLR also found that Crown failed to gather “necessary information” to enable it to make an informed decision about the probity of its junket partners, to ensure decisions relating to these assessments were made by people who understood Crown’s regulatory obligations and to keep appropriate records relating to junket probity decisions.

“This failure meant that it was unclear how certain decisions were reached by Crown and whether such decisions were made with due regard to Crown’s regulatory obligations,” the VCGLR said.

Crown Casino “failed to comply with its regulatory obligations,” according to the Victorian regulator. Picture: AFP

In addition to the fine Crown has also been banned from recommencing junket operations at its Melbourne casino until it has satisfied the regulator its processes had been improved.

​VCGLR Chairman Ross Kennedy said that while this is not the first time that the Commission has taken disciplinary action against Crown, it is the first time that Crown has been fined the maximum amount.

“That fine reflects the seriousness of this matter, and the fact that Crown’s failure to implement a robust process occurred over an extended period,” Mr Kennedy said.

“Robust processes must be implemented to ensure that Crown’s Melbourne casino remains free from criminal influence and exploitation. These are strict and legislated regulatory requirements, and this is an area where Crown has repeatedly failed.”

The penalty comes as the James Packer-backed gambling giant is facing two Royal Commissions in WA and Victoria over the suitability of the company to operate its casinos in these states.

The Royal Commissions were inspired by the NSW Bergin inquiry into the company, which determined it was currently not a suitable licensee of its Sydney Casino in February, in part due to links between mostly Macau-based junket operators and organised crime gangs.

WA has already banned Crown from partnering with junkets at Crown Perth, but the company last year committed to not partner with any junket operator that is not granted probity by the state gaming regulator in which it wants to operate.

The NSW independent Liquor and Gaming Authority has banned Crown from opening the gaming floor at its $2.2bn hotel casino at Barangaroo until it can be satisfied the company has become a suitable.

Earlier on Tuesday ILGA chairman Philip Crawford extended Crown Sydney’s temporary liquor licences out to October 31 but said “it will take time” before the regulator is satisfied Crown is a suitable licensee.

“These issues are detailed and complex, and Crown is required to undertake significant change to satisfy the Authority that it is on a pathway to regain suitability to hold a gaming licence,” he said.