Victorian regulator finalising probe into Crown Resorts

The Victorian gaming regulator is poised to conclude its investigation into the arrest of Crown Resorts’ staff in China.

The completed Crown Tower at Barangaroo, Sydney. Picture: Nikki Short

The Victorian gaming regulator is poised to conclude its investigation into the arrest of Crown Resorts’ staff in China and has asked the James Packer-backed company for more information in relation to a “show cause” notice which could lead to disciplinary action against the casino giant.

The NSW Independent Liquor and Gaming Authority (ILGA) on Tuesday afternoon will release the findings of the Bergin Inquiry into Crown’s suitability to hold its Sydney gaming licence after the report is tabled in parliament that morning.

ILGA’s response to the report will be formally considered at the authority’s next board meeting on February 17.

Inquiry head Patricia Bergin last week personally briefed members of the ILGA board on the findings of her inquiry. Crown is expected to receive the findings at the same time as they are publicly released this week.

She is widely expected to recommend that Mr Packer, Crown’s 37 per cent shareholder, not be able to exercise more than 10 per cent of his voting power in the company. She is also expected to recommend that Mr Packer’s private company Consolidated Press Holdings only be permitted to have one nominee director sit on Crown’s board instead of the current three and call for more independent directors to join the board, as well as a raft of broader recommendations.

She may also make negative findings against Crown chief executive Ken Barton.

“All findings and recommendations will be of strong interest and will be reviewed for potential relevance to the Victorian operations and regulation of Crown Melbourne,’’ Victorian Commission for Gaming and Liquor Regulation chief executive Catherine Myers said last week.

“The final report and recommendations will inform any regulatory action which may be required in Victoria and may also be relevant to previous work done by the commission.”

The Victorian regulator revealed last week that its investigations into the arrest of Crown’s China staff in 2016 had “intensified” in recent months and were soon to be finalised.

Commissioner Patricia Bergin.

The VCGLR has been criticised for its tardiness in concluding the China arrests investigation and more broadly for its alleged light-touch approach to regulation of Crown’s flagship Melbourne casino.

“The VCGLR investigation was nearing completion when Crown announced mid last year it was waiving legal professional privilege over a voluminous amount of material it had previously declined to provide,” Ms Myers said.

“Our forensic review of that material then prompted further inquiries, which are now coming to an end. As a result of monitoring the Bergin Inquiry, we also used regulatory powers to gain access to information Crown Resorts provided to the inquiry that had previously not been provided to VCGLR.”

The NSW inquiry heard of multiple risk management and governance failures that meant the Crown board was not aware of the risks presented to Crown staff in China following to the Chinese government’s crackdown on its citizens gambling in foreign casinos before the arrests.

Nineteen Crown staff were jailed, including its head of VIP operations Jason O’Connor.

In December, the VCGLR brought its review into Crown’s Southbank entertainment complex forward by three years, citing the explosive revelations around the Bergin Inquiry, including evidence of money laundering.

Ms Myers said the review, the seventh into Crown Melbourne after the last was conducted in 2018, would commence following the appointment of a sessional commissioner “expected shortly”.

In October, 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.

“The notice requires Crown to show cause why disciplinary action should not be taken for failing to ensure controls regarding junket participants were implemented,’’ Ms Myers said.

“The commission has requested further information from Crown. After that has been … considered, the commission will announce its decision.”

Following evidence presented at the Bergin Inquiry and VCGLR’s show cause notice, Crown Resorts suspended all junket operations.

The VCGLR is also working with federal financial crime body Austrac on a comprehensive review of Crown Resorts’ internal controls at its Melbourne casino for junkets and VIP players.

In October, Austrac said it was formally investigating the casino group for potential breaches of anti-money laundering laws at its Melbourne casino.