Australian gaming operator Crown Resorts has been hit with a massive $57.4 million fine after it was discovered that the company was accepting China UnionPay bank cards to fund patrons’ gambling at its Melbourne casino and hiding those transactions alongside other resort expenses.
The fine is being imposed by the Victorian Gambling and Casino Control Commission (VGCCC), and is the first for Crown to exceed $718,235 (AUD $1 million).
According to the Sydney Morning Herald, Crown processed well over $100 million in Chinese card payments from 2012 to 2016, which netted the company nearly $23 million in revenue during that time. The scam was first discovered last year during an investigation by the Victorian government.
VGCCC chairperson Fran Thorn told the Morning Herald that the operation was a “clandestine, deliberate process” that was not only illegal for the company, but also risky for patrons given Chinese restrictions on currency exchanges.
The international scam left Crown vulnerable in numerous ways–not only did it breach local casino laws regarding payment processing and accounting, it also unearthed the possibility of dealing with “dirty” money, or money associated with crime.
In a company statement, Crown said that it is committed to vindicating its “historic failings” by working to deliver a “comprehensive reform and remediation program.”
Astonishingly enough, the record fine is only one of multiple legal issues currently plaguing the Australian operator. The VGCCC has said that Crown is still being investigated for other credit and debit card transactions that occurred after 2016, which could also garner big fines.
The Australian Transaction Reports and Analysis Centre (AUSTRAC), a financial watchdog agency, is also alleging that Crown could be in hot water over revenue it accepted from VIP patrons with suspected criminal ties. If found guilty, the company could face another fine in excess of $100 million.
Crown’s legal considerations are certainly on the radar of Blackstone Group, the U.S.-based investment firm that is currently working to close a $8.9 billion deal to acquire the gaming company. Blackstone shareholders voted in favor of the acquisition back on May 20, but regulators still need to approve the deal before it can be finalized.
