Inquiry Deems Star Entertainment Group Unfit for Sydney Casino License
After months of deliberations, the eligibility of Australia’s second largest casino to hold a license to operate in Sydney has been rejected by an inquiry. Investigators have found Star Entertainment to be unfit to hold its operating license after systemic failings across the business have been identified in its internal control processes, and governance policies. At the core of the breaches are acts of money-laundering and the infiltration of criminals onto the casino’s operating model – which in turn has become exploited by the nefarious actors.
Star Entertainment sits at the precipice of losing its gambling license in New South Wales. The embattled casino is facing a series of allegations that range from financial reporting breaches, allowing underage persons to gamble on its premises, and money laundering. ©stevepb/Pixabay
The committee responsible for handling the investigation into the group found a series of troubling and concerning truths. There was a systematic governance problem at Star Entertainment, the leadership were not able to contain the criminality that was insidiously trying to overrun the day-to-day operations of the venue. After a while of lacklustre resistance to its takeover, it would appear that the management team at Star simply succumbed to the pressure of the criminals and allowed it to run rife.
Investigators from the at New South Wales Independent Casino Commission have explained there shock at how bad the situation at Star has obviously become. The mounting evidence of compliance violations exposes the nature of crimes being committed at the venue, and also the extent to which the control mechanisms of the casino had quite simply failed to withstand the pressure applied from organised criminals. The majority of the business had been compromised, and there is evidence of widespread corruption across the group.
Huge amounts of cash were spent across the casino over the past decades, and much of what has been found in the financial reports of the company suggests that this may have been predominately fraudulent. Vast sums of cash have been disguised as hotel expenses, or restaurant bills; in other words, the expenses are made fraudulently to disguise their true purpose. Evading these protocols has enabled the firm to avoid anti-money laundering catches.
Breath-taking Arrogance Permeated by Start Entertainment
From the very early stages of the investigations into Star Entertainment, it is purported that the company has demonstrated breath-taking arrogance throughout the hearings. Despite the serious nature of the crimes they are accused of, representatives of Star have been dismissive and played down the seriousness of the crimes they were accused. It goes hand in hand with a record of behaviour that showed the top-brass to be extreme risk-takers, with very little knowledge of, or regard for, the laws which govern the gambling industry in Australia. It must be said however, that this is not an indictment of the 8,000 or so staff working for Star, the vast majority of whom were following the correct procedures.
In light of the serious breaches afforded by the Star Entertainment group, there will likely be a series of fines levied against the operator. According to the NICC, the maximum amount that can be required to be paid in fines is in the region of $100 million, and for individuals this amount can be as much as $1 million. A hefty sum to be paying as a result of criminal activities over the past decades. A final decision on the charges that will be brought down on Star Entertainment isn’t expected to be reached immediately, as the company has been given a 14 day period to respond to the charges.
The looming threat to Star Entertainment remains the hindrance in its ability to open a brand new casino resort in Brisbane, a project valued at over $3.5 billion Australian dollars. Should the probe in Star find that it should not be able to hold a casino license in this state as well, that would really leave the casino in a dire state. With clouds over its structural plans for the future, it remains to be seen how the casino can potentially recover from a devastating set of blows.
If the precedent of similar investigations is anything to go by, then the circumstances do not look completely hopeless. Crown Resorts, an embattled gambling group that had its name dragged through endless court cases, was exposed to be inherently corrupt and perverse at abiding by the law. Now under the ownership of Blackstone, the casino is back on the path to revival, fully compliant with regulators – and most importantly has the green-light to open a new $2.2 billion Australian dollars resort in Sydney.
