Australian Financial Crimes Watchdog Widens Crown Resorts Probe, Adds Star

Posted on: June 7, 2021, 08:07h. 

Last updated on: July 19, 2021, 01:15h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

The financial crimes investigation into Crown Resorts is expanding, as anti-money laundering regulators are now looking into the company’s Perth casino.

Crown Resorts casino money laundering AUSTRAC
The offices of the Australian Transaction Reports and Analysis Center in Canberra. The financial crimes agency is widening its query into Crown Resorts casinos throughout Australia. (Image: AUSTRAC)

Crown has been under investigation by the Australian Transaction Reports and Analysis Center (AUSTRAC) for several months. Last October, AUSTRAC, an Australian government agency. launched a probe into alleged anti-money laundering shortcomings at Crown Melbourne. That agency is responsible for detecting, deterring, and disrupting crimes involving financial institutions, including casinos which handle large volumes of cash.

The review came as a result of an inquiry conducted by New South Wales’ Independent Liquor and Gaming Authority (ILGA). The review concluded that Crown Resorts is not suitable to hold a casino license in the state. 

Former NSW Supreme Court Judge Patricia Bergin said Crown’s failure to prevent its casinos from being used to launder money, and the company’s alleged links to organized crime through Asia, disqualified the casino giant from operating gaming in New South Wales.

Crown Inquiry Grows

Crown Resorts is working closely with ILGA to change its corporate governance and operational protocols in hopes of satisfying the inquiry’s verdict. Crown opened its $1.7 billion Crown Sydney integrated resort in Barangaroo last December as a non-gaming complex.

Crown revealed today that AUSTRAC isn’t only concerned with its Melbourne casino. The casino firm explained in a securities release that the financial crimes regulator has expanded its probe to its Perth casino, too.

Crown has been informed by AUSTRAC’s Regulatory Operations branch that it has identified potential serious non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act and the Anti-Money Laundering and Counter-Terrorism Financing Rules (AML/CTF Act) by Crown Perth. As a result, AUSTRAC has initiated a formal enforcement investigation into the compliance of Crown Perth,” a notification read.

Crown said it will fully cooperate with AUSTRAC. 

Star Now Included 

Star Entertainment, Crown’s rival in Australia that recently offered a $7 billion proposal to acquire the larger gaming operator, is also the subject of AUSTRAC scrutiny. In a securities filing, Star said it, too, is facing “potential serious non-compliance” of (AML/CTF Act).

“The Star takes its anti-money laundering obligations very seriously and will fully co-operate with AUSTRAC in relation to its requests for information and documents and the investigation,” the Star statement read. Star Entertainment owns and operates casino resorts in Sydney, Brisbane, and Gold Coast. 

The Star probe could jeopardize its bid to buy Crown Resorts. US-based private equity behemoth Blackstone Group, which has been on a buying spree on the Las Vegas Strip, is also interested in Crown.   

But Nathan Bell, a portfolio manager at Intelligent Advisor, believes the government wants to keep Crown under Aussie ownership. Bell told Reuters that if Star makes a “genuine effort” to better enforce its anti-money laundering protocols, “The regulators would rather Crown was kept in Australian hands, and Star’s takeover proposal would remain alive.”