The New South Wales (NSW) government has accepted all recommendations from the state’s inquiry into Crown Resorts’ money-laundering scandal. One recommendation, in particular, has huge applications for Crown’s major shareholder and Aussie businessman James Packer. One of the 19 recommendations calls for the establishment of an independent casino regulator endowed with the powers of a standing Royal Commission.
The new casino regulator will strongly focus on tackling the money laundering dangers associated with the gambling activities in the state, the NSW Minister for Digital and Customer Service Victor Dominello confirmed today. The regulatory authority will be subsidized by a casino supervisory levy.
Commissioner Patricia Bergin, who looked into the inquiry, also recommended the introduction of new legislation that would require casino operators to hire compliance auditors. Said auditors will work with the new regulatory body and report any suspicious financial transactions. However, the state government has not fully accepted the recommendation to ban local casinos from working with junket operators. It will be up to the new regulatory authority to draft and enforce a new licensing regime for said operators.
Recommendation 16 Could Deal a Severe Blow to Packer
One of the proposed changes, recommendation number 16, could deal a severe blow to major Crown shareholder James Packer. The recommendation in question proposes a crucial change to the Casino Control Act. Under the amendment, an individual would need to obtain prior approval from the new casino regulator before they can hold, acquire, or transfer a 10% share or higher in a given casino licensee.
Mr. Packer, who was once Crown Resorts’ chairman, has been dealing with calls to restrict his voting power in the gambling company for some time now. Packer and his lawyers have been consistently insisting his 37% share does not mean he has considerable influence over Crown Resorts and its operations.
During a 2020 NSW inquiry, evidence came to light of money laundering by Asian high-roller junkets associated with Crown Perth and Crown Melbourne. The inquiry heard Packer had helped secure a large share of said junket market. Representatives of the gambling giant indeed confirmed Packer had access to privileged information due to his large stake in Crown Resorts.
Last week, CHP lawyers argued that cutting down Packer’s share in Crown Resorts was unnecessary. According to the lawyers, the holding of a significant parcel of shares in a given company did not by itself give the shareholder a considerable influence over the company’s management and operation.
In November 2020, Crown Resorts deployed a similar argument during the NSW investigation. The company’s lawyer, Mr. Neil Young, insisted Crown had introduced various changes in the wake of the serious problems established during the inquiry, including a board renewal.
Digital and Customer Service Minister Dominello confirmed NSW authorities will continue to closely watch the work of the Victorian Royal Commission, which has yet to publish its findings. Mr. Dominello confirmed the Independent Liquor and Gaming Authority continues to evaluate Crown Resorts’ suitability of holding a gambling license in New South Wales. After Commissioner Bergin’s findings, Australia’s largest gaming and hospitality group is now able to operate only the non-gaming aspects of its Barangaroo property in Sydney.
- Author
Olivia Cole
