Hope for Crown Resorts Employees Caged in China, Charges Could be “Low Level”

Posted on: May 3, 2017, 02:00h. 

Last updated on: May 3, 2017, 02:40h.

Fourteen Crown Resorts employees arrested in China, who have languished since October without charges in a grim detention center in Shanghai, have at last been presented with a glimmer of hope.

Jason O’Connor, Crown Resorts’ VP of VIP operations, arrested in China
Crown Resorts’ VP of VIP Jason O’Connor, the only executive member of the company’s employees detained in China on suspicion of gambling-related crimes. (Image: Crown Resorts)

According to the Australian Financial Review, the police investigation into the “gambling-related crimes,” of which the 14 are suspected, is now complete and the case has been handed to Shanghai’s Baoshan District People’s Procurator.

This means charges are likely to be forthcoming soon, moving the legal process forward and at last offering some clarity on the fate of the detainees.

Moreover, AFR notes that the fact the case has been passed to a district rather than city procurator makes it more likely that authorities are pursuing lower-level charges against the 14, rather than serious offenses such as money laundering, which carry much harsher sentences.

Case for Lenient Sentences

It’s prompted hope that their plight could be treated in a similar way that of the group employees of South Korea’s of Grand Korea Leisure and Paradise Co, who were detained in 2015 for marketing casino gambling to Chinese residents and released after around 18 months.

If the Crown staff are charged simply with “gambling-related crimes,” they could face anything up to three years in prison, according to Si Weijiang, a Shanghai criminal lawyer, who spoke to AFR. But should charges be expanded to include money laundering they could be facing many, many times that amount, he said.

The detainees, who include three Australians, among them the company’s VP of VIP Operations Jason O’Connor, were detained by authorities in least four cities across the country on October 13 and 14.

Oblique to Opaque

Since then, their legal situation has gone from oblique to opaque, as several official deadlines for filing charges having come and gone without action.

“The consular officials who visit, only address the prisoners’ welfare, not legal issues,” The Australian’s China correspondent reported in February. “Their lawyers aren’t saying anything, though they might not know anything substantive either.”

The arrests were devastating to Crown Resorts, whose VIP revenues dropped by 45 percent in its first financial report since the incident. It prompted Crown to cut its investment exposure to China through the sale to of $1.5 billion worth of shares in its Melco Crown operations in Macau, arguably at the very moment the region bottomed out and began a sustainable economic recovery.

The depletion of VIP revenue dragged Crown’s overall adjusted profits down by 9.1 percent in the six months since the arrests, caused a major reshuffle to the board of directors, and prompted talk of an “efficiency drive,” which will ultimately translate into job cuts.

Crown also plans to sell three private jets, which it bought for a total of $100 million in 2014, as well as a fleet of luxury yachts.