New South Wales Wants More Time to Complete Star Entertainment Investigation
Posted on: April 11, 2022, 06:18h.
Last updated on: April 13, 2022, 01:01h.
New South Wales continues its investigation into casino operator Star Entertainment’s somewhat dubious past. That investigation will take a little longer to complete than authorities initially anticipated.
Star Entertainment is going to have to squirm a little more before it learns its fate in New South Wales (NSW). The Australian state’s Independent Liquor and Gaming Authority (ILGA) has already uncovered a number of issues pertaining to regulatory failures, including the company’s handling of anti-money-laundering (AML) protocols.
The plan was to conclude the investigation as quickly as possible and provide a recommended course of action by June. However, the man leading the investigation for the ILGA will need more time.
Star Investigation Continues
Adam Bell SC, the man who conducted the Crown Resorts investigation in NSW, is also in charge of the state’s investigation into Star. He requested two more months to wrap things up, wanting to bring in more witnesses and add new lines of questioning.
The ILGA approved Bell’s request and new initiatives. Now, instead of receiving his findings by June, the regulator will have to wait until the end of August.
Matt Bekier won’t escape scrutiny. Star’s former managing director and CEO, who resigned due to the ongoing scandal, will appear in a hearing this week. Joining him is Greg Hawkins, Star’s chief casino officer.
Star Proved Its Talent at Hiding Activity
Several former and current Star employees have acknowledged that the company engaged in the activity for years it knew was illegal. It fudged documents to hide how VIP patrons were spending money. It also allowed junkets to conduct massive cash transactions without verifying sources of funds.
However, during all of that time, regulators never pressed the company. In the past six years, according to the Australian Financial Review, NSW hit Star with less than AU$200,000 (US$148,700) in fines. Much of that, AU$90,000 (US$67,897) is from a single fine in 2020.
Most of those fines were for relatively minor infractions. Mostly, they resulted from minors accessing casino floors or for violations of liquor laws. Only three of the 17 fines since 2016 involved Star’s license, and only one of those resulted in a fine.
The other two concluded with “letters of censure.” This is essentially a letter of reprimand buried inside the permanent record.
The ongoing debacle regarding Star and Crown Resorts is already forcing changes on the local and national levels. Victoria, NSW and others are creating new regulators solely for gaming, and a national regulatory body may also enter.
Star ‘Completely Hopeless’
A Star lawyer faced scrutiny today and tried to lessen the extent of trouble the company faces. During general counsel, Andrew Power’s grilling, Star’s repeated interactions with junket operator Suncity Group came up. One after another, Power downplayed the relationship.
Power was previously Star’s AML compliance officer. Under his leadership, Suncity routinely conducted activities at Star properties with large amounts – backpacks – full of cash with no questions asked. This allegedly went on for years. Even after certain individuals highlighted concerns between 2016 and 2019, the company didn’t take action to remedy the situation until 2021.
During the interrogation, allegations that Power “conspired with casino managers” to alter records surfaced. He said that was incorrect but later admitted that the company sanitized records related to cash transactions.
Star employees have already admitted that many Chinese VIP gamblers were able to use the China Union Pay cards in violation of established regulations. However, when asked if this led to creating “dummy invoices,” Power said no.
He asserted that it only led to creating “dummy rooms.” This is likely about creating fictitious hotel rooms that disguised the destination of the gamblers’ funds.
As a result, the inquiry accused Star of being “completely hopeless” at managing risks. It also has “absolutely no confidence” in Power’s ability to properly determine worthwhile business partners for the company.
Power could only state that it wasn’t a “fair” assessment, despite the overwhelming evidence to the contrary.
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May 12, 2022 — 3 Comments—