Crown’s ivory tower shattered
It was just another lunch service at James Packer’s Crown Sydney on Tuesday, with staff and patrons largely oblivious to the airing of the $6.8bn company’s regulatory filthy, dirty laundry.
While the $2.2bn building’s lifts conveniently skipped the many dedicated gambling floors, the question of their opening was top of mind for the many staycationing guests and stickybeaks.
Though the findings of Patricia Bergin’s report didn’t set out clear timelines for change, Margin Call heard staff at the venue touting an optimistic line — informing guests that casino operations were likely to be up and running by next month.
But with a potential $2bn share selldown to complete, a board to refresh and governance to rehabilitate, no doubt it will be a busy few months ahead for Packer — regardless of the physical distance he may manage to put between himself and Bergin’s investigation.
There was no way the 53-year-old billionaire was avoiding culpability for the casino’s failings, with Bergin’s findings brutal.
The 768-page report filed by Victor Dominello to the NSW parliament (across two volumes, mind you) mentions Packer no fewer than 615 times, at times for his role in building the so-called casino “empire”, but more often than not for his role pushing the group’s disastrous junket strategy and defining Crown’s group’s poor culture.
Integrity questioned
As expected, the recommendation is for Packer to sell down his share, though the report goes further, calling into question the businessman’s integrity, citing his conduct in making a “very serious threat against a business colleague” — the infamous Mr X, or Ben Gray.
That incident, the report noted, was probably the driving factor in Packer’s first resignation from the board in December 2015, rather than any health issues.
Packer’s medical condition does warrant a mention however, when it comes to notes on his dealings with Melco’s Laurence Ho — the report noting that it added to the complexity of the situation, but that any “forgetfulness or failing to turn one’s mind” to government undertakings “must surely be intolerable”.
Scathing summaries
Patricia Bergin was scathing when it came to former Crown chair Rob Rankin, who remains in self-imposed exile in the UK after controversially declining to give evidence to the 18-month-long probe.
Last we knew, Rankin was holed up at his luxury home in the Cotswolds.
“The elusive Mr Rankin’s reign as chairman was clearly lacklustre,” the report concluded.
“Although Mr Packer understood that Mr Rankin was a ‘specialist’ in matters relating to operations in China, [Packer] was sadly disappointed.”
Bergin’s judgment was also harsh on Packer’s threat to Melbourne-based private equiteer Ben Gray.
“[Rankin] should have advised his colleagues on the board of the serious problem that beset them with their former chairman and then director making such a disgraceful threat,” Bergin said.
“It is quite inexplicable that he did not do so and reflects very badly on his character.”
Bergin has left it open for ILGA to refer Rankin to ASIC for investigation.
Former Crown CFO and then CEO Ken Barton’s reputation was also left in tatters. “Mr Barton has demonstrated that he is no match for what is needed at the helm of a casino licensee or a close associate of the licensee,” Bergin wrote.
“The authority would be justified in concluding that it cannot have any confidence in dealing with Mr Barton as a director of the licensee or Crown.”
As for media man and trusted long-time trusted Packer family lieutenant John Alexander, Bergin found that his “stewardship led Crown to disastrous consequences”.
“Whatever the late Mr Kerry Packer and then Mr James Packer wanted was what was done,” she said.
The former NSW Supreme Court judge didn’t miss another Packer loyalist and Crown director for 13 years, Mike Johnston, either.
“It would be appropriate for him to conclude his tour of duty as soon as possible to enable the authority to be comfortable in due course that Crown will be a suitable person to be a close associate of the licensee,” Bergin said.
“[He] should not have been involved in any managerial role with Crown nor on any board committees particularly relating to corporate governance or risk management.”
Crown non-executive director and former head of the AFL Andrew Demetriou was no less than humiliated by his turn before the inquiry.
“It is difficult to understand what might reasonably be made of this quite bizarre performance,” Bergin said of his evidence.
“The authority would be justified in lacking confidence in placing reliance upon Mr Demetriou in the future.” Yikes.
Adman Harold Mitchell, Bergin recommended, needs to consider his slot on the board in light of recent court findings against him.
“It is not known at the time of submission of the report whether any appellate steps have been taken in respect of the declarations and penalty,” she said.
“If not, it is presumed that Mr Mitchell will further reflect on the need to refresh the Crown board and take steps to expedite that process.”
And what of former top bureaucrat turned company director Jane Halton?
Bergin found there was no basis for “any adverse finding in respect of Ms Halton’s credit or integrity”, although the report will not have been comfortable reading for the also ANZ director, who Bergin said emerged with “her integrity intact”.
“Ms Halton was a touch argumentative,” the report reads. “Ms Halton presented as a person who is most comfortable when being and feeling in control of the agenda.
“However the environment of the witness box does not usually provide such comfort.
“Ms Halton may have felt rather negative about her experience in the witness box.”
Ouch.
Fleshing out judge
Through the exhaustive inquiry, Patricia Bergin has shown she’s head and shoulders above the rest when it comes to getting to the crux of the issues … but in fact, that’s also about all we’ve seen of her. Her head and shoulders, that is.
Despite the gravity of her findings and the many hours she has spent calling Crown’s top brass to account, there is very little we know about the former judge herself.
Sworn in as a judge of the NSW Supreme Court in 1999, just a year after taking silk, her contemporaries including former ABC chair James Spigelmanand Ian Barker described her as having a “wicked” sense of humour, splendid command of language and the capacity to get to the heart of an issue and deal with it “incisively”.
Skills of course put to work in her most recent posting, but sharpened through her career working on criminal cases including the likes of the Wood royal commission into the NSW police service and the long-running extradition and consequent trial of drug identity Bruce “Snapper” Cornwell — a key identity in the Sydney gangland wars of the 80s.
All that for a graduate of the eastern suburbs’ Kincoppal and even after an initial five-year stint as a schoolteacher.
While Bergin retired from the NSW Supreme Court in January 2017, it seems she isn’t taking the usual grey nomad route to the time off, preferring to fill her schedule with postings like the Crown inquiry between cases heard before the Singapore International Commercial Court.
Recall the break in public hearings last February, not scheduled for a little R&R but rather to preside over a legal dispute between a state-owned Chinese financier and the owner of a Singaporean boat fleet.
No doubt after the lengthy crown inquiry she’ll be looking for a little time off though.
We hear St Barts is nice this time of year.
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