Crown Royal Commission outcome could help Star, analysts say
Analysts at JP Morgan believe the Victoria Royal Commission’s decision to allow Crown Melbourne to keep its licence under stricter conditions could benefit The Star Entertainment as it also faces a licence review.
Australia.- Victoria’s Royal Commission has allowed Crown Resorts to keep its Melbourne licence under strict new conditions with the appointment of a Special Manager. The decision’s been seen as a good sign for The Star Entertainment Group, which faces a review by the Independent Liquor & Gaming Authority (ILGA) after media allegations of money laundering.
According to analysts at JP Morgan, Star’s misconduct was not “as bad as Crown’s, so it is unlikely it will face a negative outcome.”
The review, required by the Casino Control Law, will decide whether The Star Entertainment is working within the limits of consistency and if it is suitable to continue holding a casino licence. Public hearings will start in March 2022. Bell will share the results of the investigation with the New South Wales regulator by late June 2022.
The review was ordered after a joint report by three news outlets (The Age, The Sydney Morning Herald and 60 Minutes), implicated the firm in suspected money laundering, organised crime and fraud. They reported that between 2014 and 2021 the firm wooed high-rolling gamblers allegedly linked to criminal or foreign-influenced activities.
Star Entertainment Group, however, has said the assertions were misleading and that it “will take the appropriate steps to address all allegations with relevant state and federal regulators and authorities.”
Stephen O’Bryan QC appointed as Crown Resorts Special Manager
Judge Raymond Finkelstein, who led the state of Victoria’s inquiry into Crown, has appointed Stephen O’Bryan QC, as Special Manager. He will have unprecedented powers to oversee Crown Resorts, veto decisions of the Board, and will have access to all areas of the casino and its books and records.
Finkelstein said he had taken the decision because he understood that if Crown Melbourne’s licence was cancelled, it would hurt the Victorian economy. The proposal has been approved by the Victorian government, which said Crown’s licence will be cancelled unless Crown Resorts can convince the regulator it has changed.
A total of 33 recommendations were made by the Royal Commission, which recognised that Crown Resorts has started a significant reform programme. The report suggested increasing the maximum possible penalty under the Casino Control Act 1991 from AU$1m to AU$100m to “make sure there are meaningful consequences for breaches of the law.”
The company said: “Crown Resorts will work cooperatively and constructively with the Victorian Government in relation to the findings and recommendations of the Report and their response.”
