Star casino probe may spark criminal charges

The failed and potentially criminal oversight of The Star casino in Sydney allowed alleged money laundering, fraud, and organised crime to flourish, lawyers argue.

Naomi Sharp, SC, counsel assisting the NSW Independent Liquor and Gaming Authority. Picture: AAP

The failed and potentially criminal oversight of The Star casino in Sydney allowed alleged money laundering, fraud, and organised crime to flourish, a lawyer argued Friday at an inquiry reviewing its licence to operate.

Naomi Sharp SC, counsel assisting the NSW Independent Liquor and Gaming Authority, made her closing arguments that listed Star Entertainment should have its licence revoked.

She repeatedly stressed that the recent exodus of a number of senior Star executives was not enough to address or correct deep-seated cultural problems and numerous governance failures.

Ms Sharp said that widespread “dishonesty, lack of ethics and a preparedness to risk noncompliance with the casino regulator’’ was endemic throughout the organisation as it prioritised profit above all else.

Naomi Sharp, SC, counsel assisting the NSW Independent Liquor and Gaming Authority.

“It‘s clear from the evidence that many systems failed,” Ms Sharp said.

“We submit that something has gone very seriously wrong within the culture of the senior ranks of Star Entertainment and, of course, The Star itself.’’

Since the inquiry started in mid-March, chief executive Matt Bekier, chief financial officer Harry Theodore, chief risk officer Paula Martin and NSW chief casino officer Greg Hawkins have all stepped down. Chairman John O’Neill, who spent more than a decade in the role, has also resigned.

The interim chairman’s role has been filled by Ben Heap, while Geoff Hogg has taken on the role of acting chief executive.

“It’s not enough to change the culture of the organisation and at the very least there must be root cause analysis to understand what has gone wrong,’’ Ms Sharp said.

She told inquiry head Adam Bell SC that both the Star board and top executives shared the blame for multiple failures to implement adequate risk management and ensure proper oversight of its international VIP junket business, which enticed plenty of high rollers from Asia.

Ms Sharp alleged that there had been many violations of the Casino Control Act but Star “took the chance in the hope of not being caught’’.

She pointed to alleged loan breaches and the improper provision of credit to gamblers, as well as “numerous instances where the regulator was misled’’ and the production of “sham documentation’’.

Former Star Entertainment Group CEO Matt Bekier

“We submit that the gravity of these problems only became apparent after these public hearings had commenced,’’ Ms Sharp said.

“What this means is that there is only a very limited time for the board to reflect on what has gone wrong and what needs to be done.’’

Ms Sharp claimed Star may have breached its continual disclosure requirements as a publicly-listed company, pointing to a “selective briefing of investors’’ by Mr O’Neill last year after allegations of wrongdoing surfaced in the media.

She told the inquiry there had been an especially grievous failure of corporate culture in the VIP division and there was “disdain’’ for the industry regulator, made worse by a “degree of complacency and group think’’ among long-term employees.

Ms Sharp pointedly said that she would make submissions in writing to the inquiry about 12 allegations aired in the media which could constitute breaches of the law.

They include claims of money laundering by high rollers tied to organised crime and falsified documents which showed bogus hotel bookings.

“Star ignored red flags,’’ she said.

“There was a preparedness to deal with business associates where they could not satisfy themselves that they were of good repute.’’

The inquiry, which is expected to wrap up later this month, has previously heard that Star intentionally disguised nearly $1bn worth of illegal transactions on debit cards as hotel charges over a seven-year period. Those actions mislead both the National Australia Bank and the Bank of China.