“Arse-covering” in wake of scandal
Crown Resorts has assembled a team of high-priced lawyers and advisers as 18 employees continue to be held for “gambling crimes” in Mainland China. In mid-October, employees including Jason O’Connor, vice president of international VIP operations, were taken into custody for allegedly breaking China’s strict law against marketing to gamblers on the mainland.
The Sydney Morning Herald reports that Crown has retained legal firm Minter Ellison to investigate the potential culpability of its own management team following the scandal. Asked what the review was for, a senior Crown official told the Herald, “I would typify it as an act of corporate, legal and reputational arse-covering of the first order.”
Fairfax Media, owner of the newspaper, has learned that Minter Ellison will determine the “potential exposure Crown has to lawsuits or class actions from the families of arrested staff or disgruntled shareholders, who have seen Crown’s share price tumble in the wake of the crisis.”
The review will also look at suggestions that Crown continued marketing to Chinese high rollers despite warnings from local authorities to stop. Another source told the media outlet that there could be trouble when the families of the detained employees “come to a realization that Crown has failed massively in its duty of care.” The source added that Crown directors and management “are all obviously worried about their own personal liability—that is, paper trails that prove they knew China had warned them not to market into China.”
Late last month, the three Australian nationals among the 18 staffers were officially arrested after weeks of detention. They included O’Connor and colleagues Jerry Xuan and Pan Dan. China’s government-controlled judiciary has a conviction rate of more than 99 percent once charges are filed.
According to Bloomberg News, “Crown insiders” believe the company “made powerful enemies by attempting to cut out and poach customers from established Asian-based junket operators in order to avoid paying them commissions.”
U Io Hung, chairman of the CC UE VIP Club junket, told the news outlet, “Crown went over themselves to look for clients. I told them they should be careful, but they just wanted revenue.”
One of the Chinese employees has been released, but the fate of the other 14 is still unknown.
