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Day of Reckoning for Crown Resorts as Sydney Casino Project Rejected

Australian FlagThe Australian casino firm Crown Resorts has suffered a major setback after plans for a new property in Sydney were denied following an independent investigation.

The New South Wales Casino Inquiry found evidence to suggest that money laundering is rife at the operator’s other properties around the country, and so proposals for a new Crown casino in Barangaroo have been rejected by the authorities.

Crown has also been linked to alleged organised crime in China, with so-called ‘junket operators’ in the Asian country considered to be something of a smokescreen for money laundering and other nefarious activities.

Further scrutiny came when Crown agreed to sell a near 20% stake in their firm to Asian outfit Melco for nearly £1 billion, with owner James Packer overseeing the sale despite not seeking approval from Crown’s board of directors.

When news of the Inquiry came to light, Melco pulled out of the deal and sold the shares they had already acquired to private equity firm Blackstone.

There could be further implications for casino gaming in the state. The business and innovation minister, Victor Dominello, is said to be considering changes to how casinos in New South Wales operate.

“Among other things, the report raises serious issues relating to organised crime and money laundering in our community,” he said.

“We will consider its recommendations very carefully before providing a formal response in due course.”

Revelatory Inquiry Proves Damning for Crown

International Towers, Barangaroo, Sydney, Australia

The New South Wales Casino Inquiry was designed to see if Crown were deemed worthy of their new Sydney licence, and as it stands the casino giant has a raft of changes it must implement before that becomes a reality.

Conducted by the New South Wales Independent Liquor & Gaming Authority, the Inquiry found that Packer and Crown possessed an ‘unjustified belief in itself’ and had displayed ‘corporate arrogance’ in failing to deal with the allegations of money laundering, which date as far back as 2018.

Investigations revealed beyond doubt that money laundering had taken place at Crown’s own casinos and those of their subsidiary companies, which included numerous deposits from single accounts of just under the $10,000 daily threshold – any figure more has to be reported, while one customer is reported to have carried out a series of deposits totalling $15 million at Crown properties.

As if that wasn’t bad enough, seven different Asian junket operators that Crown had worked with have or had links to organised crime in China and beyond.

Concluding its report, the New South Wales authority commented on the ‘poor corporate governance, deficient risk management structures and processed and poor corporate culture’ that saw Crown’s licence application denied.

However, if the firm implements a raft of changes outlined in the report, it could be permitted to operate the planned casino in the future.

“The very serious problems of the infiltration of Crown subsidiaries’ accounts by organised criminals should send a shiver down the spine not only of any casino regulator but also the community generally,” said Patricia Bergin, who oversaw the investigation.