Star Entertainment facing battle to retain casino licences for Brisbane and Gold Coast

Star Entertainment is expected to be issued with a show cause notice over its casino licences in Brisbane and the Gold Coast.

The Star casino on the Gold Coast

Star Entertainment is expected to be issued with a show cause notice over its casino licences in Brisbane and the Gold Coast on the back of a new report that has found money laundering and wrongdoing within the gambling giant’s Queensland operations.

The report of the Queensland inquiry into Star, headed by retired Court of Appeal judge Bob Gotterson, will be released on Thursday and is believed to echo this findings by the NSW inquiry that the company was “un­suitable” to hold a Sydney casino licence.

Star now faces a fight to retain its licence and the possible government appointment of a “special manager” to oversee its gaming operations as it moves to open the $3.6bn Queens Wharf casino resort in Brisbane’s CBD next year.

Mr Gotterson had been asked to provide advice to Attorney-General Shannon Fentiman about the “ongoing suitability” of Star to hold a casino licence in the state.

The report will call for an overhaul of legislation policing casinos in Queensland, with findings that current laws are ”outdated,” and will recommend the immediate scrapping of a provision in the Queen’s Wharf contracts that compensates Star if it faces new regulations.

Mr Gotterson has recommended a suite of proposed controls on gamblers, with a recommendation for mandatory pre-commitment rules on those playing poker ­machines.

A similar nationwide move by the Gillard government to roll out mandatory pre-commitment technology for pokie players by 2014 was abandoned after heavy lobbying by the industry.

Mr Gotterson will also call for identity-linked gambling cards and a $1000 limit for cash transactions to be introduced in casinos in a bid to tackle money laundering and assist problem gamblers.

Star Entertainment’s casino at Queen's Wharf in Brisbane. Picture: Dan Peled

The report and likely show cause notice in Queensland is the latest in the crackdown on casino operators across Australia, with evidence of systematic wrong­doing by both Star and its rival Crown in NSW, Victoria and Western Australia.

In March, the report of the year-long royal commission into Crown’s Perth casino echoed the findings of similar inquiries in NSW and Victoria when it determined that Crown and its subsidiaries were not suitable to hold a gambling licence.

Earlier this month, Star was ­issued with a 14-day show cause notice to prove it was suitable to retain its Sydney casino licence with the release of the final report of the NSW inquiry, headed by Adam Bell SC.

The Bell report concluded that Star was unsuitable to manage a casino.

After 46 days of hearings, the Bell inquiry found that the ­company, with a market value of more than $2.6bn, had set up an “inherently deceptive and un­ethical process” disguising more than $900m as hotel expenses to allow wealthy Chinese gamblers to bet at the ­venues, failed to check the source of the money and knew for years it was in breach of the rules.

The Gotterson inquiry was told in August that many of the problems didn’t stop at the Queensland border, with Star ­accused of a “one-eyed focus on profits and money” and evidence given of its failure to ban suspicious high-roller gamblers.

The company is building the $3.6bn Queen’s Wharf resort ­casino in Brisbane’s CBD in a joint venture with Hong Kong partners Chow Tai Fook and the Far East Consortium.

In August, The Australian ­revealed Chow Tai Fook’s links to Macau gambling boss Stanley Ho and his alleged triad connections and that these were raised as a concern during the state government probity check for the Queens Wharf casino licence.