A money laundering scandal has put Australian casino giant Crown Resorts in peril, with its gaming licenses hanging in the balance and its overall survival in doubt. It’s also shone a light on state politicians and regulators, who seem to have ignored longstanding money-laundering rumors.
In February, a committee in New South Wales (NSW) found that Crown was unsuitable to open its multibillion-dollar casino in Sydney because of money laundering at its casinos in Western Australia (WA) and Victoria. That probe has put its gaming licenses at risk in all three states.
While the Sydney casino remains dark, royal commissions are revving up in WA, home of Crown Perth, and Victoria, home of Crown Melbourne. But it’s not just Crown and its executives (many of whom have gotten the boot) who are under the gun.
Politicians like Victorian Premier Daniel Andrews are facing criticism too, for reportedly enjoying too “cozy” a relationship with Crown and its billionaire boss, James Packer. Packer stepped back from the company several years ago for mental health reasons, but continues to own a majority share.
According to MSN, Crown has been “one of the country’s biggest donors to political parties in the past 10 years”; prudently, in a statement to the Australian Securities Exchange, Crown said it and its associated entities “will cease making monetary or in-kind political donations, effective immediately.”
Meanwhile, Premier Andrews defended the time it took for his government to act on the money-laundering allegations, which were reported in the media as early as 2014.
“I’m not someone who looks backwards,” he said. “You’re not going to get me standing here and apologizing for having put the highest and most formal legal process in place to determine whether that business should have that license.”
Andrews pointed out that Crown is the largest private-sector employer in the state. “It’s more than just a gaming floor, it’s an entire precinct,” he said. “But it has to be run to the highest of standards. That’s not the way the place has been operating for a period of time, by admissions made. Let’s have this process, let’s get to the bottom of all of those issues.”
Asked if he’s prepared to terminate Crown’s casino license if recommended by the royal commission, Andrews said, “Yes.”
The Western Australia commission will specifically look at why its own regulators missed for years what the NSW inquiry discovered in 18 months. Specifically, the commission will examine “the adequacy of the existing regulatory framework in relation to casinos and casino gaming in Western Australia to address extant and emerging strategic risks identified in the Bergin Report (in NSW), or otherwise by this inquiry, including in relation to junket operations, money laundering, cash and electronic transactions and the risk of infiltration by criminal elements into casino operations.”
Reverend Tim Costello, of the Alliance for Gambling Reform, said the situation “shows most of us in Melbourne that we’ve lost trust that our government can really regulate Crown, that the regulator can really regulate Crown.” He said states need “utterly independent” regulators, and claimed state premiers from both political parties have had “very cozy relationships with Crown.”
Crown has pledged to fully cooperate with the proceedings in each state.
