The purportedly imminent opening of Sydney’s Barangaroo casino has become much less of a certainty of late following damning evidence revealed at the Victorian royal commission.
ILGA, the New South Wales gaming watchdog may have also suffered slight reputational damage due to its chairman, Phil Crawford’s relatively recent pronouncements that Crown Resorts would likely soon be able to achieve suitability and open its Barangaroo casino palace.
Crawford’s misguided optimism can be forgiven, however, as at the time, Crown NSW seemed certain to weather the inquest relatively unscathed. The ILGA had expressed confidence that Crown would deal with the array of accusations fielded at it by the regulator’s inquiry headed by Patricia Bergin.
The ILGA’s reform outline was meant to allow Crown to reinvent itself as a transformed casino operator with an all-new board and a senior management team geared at enforcing anti-money laundering measures, free from the influence of the operation’s largest shareholder, James Packer.
As things stand, Crown seems ill-positioned to achieve a renaissance with its current chairman and long-serving director Helen Coonan still in her position. It would seem that her retirement or removal is essential to taking the first step to recovery.
A tough spot
Crown’s recent fortunes have been anything but favourable as news of the operator’s various transgressions are now widespread. The rising awareness of the situation should be of particular interest to Crawford who would have to face the PR fallout of approving Crown’s license while the company is under such scrutiny.
The Victorian royal commission for its part is under the impression that some of the more publicly identified issues are less important than other, more insidious ones. While Crown’s top layer of executives and its board shoulder much of the blame, the organisation’s culture is where critical problems emerge.
The commission is combing through Crown’s operations with meticulous attention, examining its opaque practices, its tendency to prioritise commercial gains over its duty to obey the law, and its outward defiance of the regulator with threats the company has made to plead its case directly with the state government, effectively undermining its authority.
Ray Finkelstein, who heads the Victorian inquest along with his team, seems sceptical of the evidence presented by some former and current staff members as some of them seem to have poor memories about the events in question.
Crowns most recent setback has been the emerging news that it failed to pay as much as $270 million in state taxes, a detail that Coonan was privy to in February. It has been shown that Crown regularly deducted items like free accommodation, meals, alcohol and other perks offered to loyal customers from its gross revenue before calculating tax.
Crown was forced to admit that this information should have been presented to the royal commission at a much earlier time, giving further weight to the perception that the casino promotes an internal culture of concealment.
The casino has also participated in the illegal practice of allowing its customers to use credit cards to purchase gambling chips for some time now, creating more stains that the operator will not easily be able to wipe clean.
There is currently also no existing full audit of the breadth and width of the money laundering activity at Crown’s casinos. Deloitte, which is currently performing an independent audit of the company’s accounts, has yet to release its findings, which will not include Crown’s other internal patron ledgers, known as the DAB accounts.
While the auditor was unable to uncover any recent evidence of ‘structuring’ money laundering, there are many other ways to conceal this illegal activity.
The hottest potato that Crown is currently attempting to palm is likely the company’s lack of adherence to the responsible gambling regulations. An absence of training and a scarcity of resources have also been noted.
