Crown Casino Limited faces an unsure future after the launch of an inquiry by the Eastern New South Wales gaming regulatory agencies. The inquiry will seek to determine whether the local casino operator has acted in contravention of its license conditions. Crown Casino has sold approximately 20 percent of its stake to its Asian partner, Melco Resorts and Entertainment Limited.
The New South Wales Liquor and Gaming Authority announced that the investigation would determine whether the deal breaches the license terms of Crown Casino. Former judge, Patricia Bergin is serving as the investigation head and will determine if Crown Casino or its subsidiary are still entitled to their Barangaroo license.
The Barangaroo casino, which is still under construction near the Sydney Harbour Bridge, is an important project for Crown as its intention was to attract international casino buffs to Australia. There is now a chance that this venue may never open its door to the public.
Star, Crown casino’s main competitor, will be keeping a close watch on this inquiry as Patricia Bergin will also be examining the suitability of the licensing laws of New South Wales in a changing environment.
James Packer is likely also holding his breath as he has already sold approximately half of his stake to Melco and has to wait for the inquiry to conclude before he can transfer the remaining stake.
A thorough investigation
Patricia Bergin will be using the accusations leveled against Crown, published in the media, to inform her opinion on the matter. According to 60 Minutes, a current affairs TV program, the affiliates, agents and subsidiaries of Crown Casino are in contravention of the terms of the gaming license and are in alliance with operators who are associated with money launderers, organized crime groups as well as drug and human traffickers.
Bergin is also obliged to investigate whether Hong Kong Casino Magnate, Lawrence Ho or other key partners who will become partners of the Crown Resort as a result of the deal, are of good repute or whether they are at all linked to any other individuals, agencies or authorities who have a negative reputation in respect to integrity, honesty, and character. Whether they have objectionable or unacceptable monetary sources will also be scrutinised.
The Barangaroo license contains a provision which has banned the father of Lawrence Ho and a few other members of the Ho family from having any involvement with Barangaroo. Lawrence Ho’s father, Stanley, is suspected of having close relationships with organized crime, an accusation he has consistently denied.
A list of banned individuals and operators was declassified on 8 August, in the NSW parliament after independent upper house MP Justin Field demanded it be made public. Lawrence Ho’s name is mentioned, bringing to light the fact that he purchased 20 percent of the stake from James Packer while being restricted from conducting business in Barangaroo.
Melco’s association with this project is also concerning because of its association with Great Respect, a barred agency. The exposure of this document is ultimately what triggered the NSW Government to launch the investigation.
Crown Resort has committed to offering its full cooperation with the investigation. This is not the first time that the share transaction has faced opposition. James Packer and Lawrence Ho have previously had to wait for three states in Australia to sanction the deal.
The share deal, which constitutes a $1.75 billion payment for a 20 percent stake of Crown, was a two-part arrangement. The initial transaction happened June and the second part was due to be concluded by the end of September. Lawrence Ho, at the time, erroneously stated that it would not need any approval from regulatory bodies to be completed.
The agreement has now been amended to include a requirement of approval from the concerned agencies in New South Wales.
Australia is a prime destination for gambling enthusiasts from around the world and the country wishes to ensure that they maintain a reputation for having a fair and crime-free gambling industry.
Suspended animation for Crown Sydney
Crown Sydney was due to open its doors in 2021. The company’s hope was to establish a successful sister site to t the Crown Perth facility, which is situated in Western Australia and Crown Melbourne in Victoria.
Crown Sydney will be the second legal casino in the stat, joining ‘The Star in an effort to attract customers from the region. In contrast to The Star, Crown Sydney’s focus will be squarely on attracting VIP’s and high rollers. The massive 75 floor, 350 room casino is designed to attract affluence.
Gamblers may never get to sample the exclusive delights of this new venue, depending on the outcome of the inquiry. All Crown’s stakeholders can do at the moment, is hope for the best.