After months of hearings, characterised by spectacular admissions including threats of violence, the report of the Bergin Inquiry into the probity of Crown Sydney Gaming, a subsidiary of Crown Resorts Limited, has been tabled in the NSW parliament.
Crown Resorts runs the Crown casinos in Melbourne and Perth.
The Inquiry found that Crown Sydney Gaming was “not a suitable person” to operate the Sydney casino.
It also found the parent, Crown Resorts Limited, was “not suitable to be a close associate of the licensee”.
The serious corporate failures relate to
Crown’s operations in China and the arrests of the employees in October 2016 with “numerous failures to escalate indicators of real risks to the staff”
the infiltration and exploitation of Crown’s Melbourne and Perth operations by “criminal elements, probably including international criminal organisations”
the probability of money laundering in the accounts of two Crown subsidiaries “and in the casino premises with hundreds of thousands of dollars brought into the casino in cooler bags and shopping bags and exchanged for chips and plaques”
Crown’s failures to ensure it only had commercial associations with Junket operators of good repute
Other matters relate to “the structures in place that have contributed to the corporate failures” including:
the existence and operation of a Controlling Shareholder Protocol
Crown’s relationship with James Packer and his company Consolidated Press Holdings
Crown’s risk management structures and their resourcing.
The report says it is clear each director understood as at 2019 that Crown had given an undertaking to the NSW Government and the Authority that it would not allow the late organised crime figure Stanley Ho to acquire a direct, indirect or beneficial interest in Crown.
Undertakings not honoured
Yet it found the late Mr Ho’s associated entity had an interest in Melco Resorts & Entertainment to whom Packer agreed to sell his company’s Crown shareholding and “thereby obtained an indirect interest in Crown”.
Speaking ahead of the tabling of the report, NSW Treasurer Victor Dominello said that at the heart of the inquiry was concern over organised crime, money laundering, and gambling.
Commissioner Bergin also recommended that a new Independent Casino Commission with the powers of a standing Royal Commission be given sole authority over licensing and disciplinary issues.
Tabling the report in parliament, and invoking parliamentary privilege, is reportedly intended to circumvent the possibility of defamation action by directors and executives of Crown arising from the report.
No confidence in directors
Commissioner Bergin concluded the Independent Liquor & Gaming Authority
Ken Barton is the chief executive of Crown Resorts Limited.
Another director, Michael Johnston,
He should “conclude his tour of duty as soon as possible”.
In regards to another director, former AFL chief executive Andrew Demetriou, the report found
It concluded that
Another director, Harold Mitchell, should
Remote management by Packer
The report describes a confused culture within Crown, with some directors and executives more loyal to Mr Packer, who is no longer a director, than the company itself.
The stewardship of long-time Packer associate John Alexander, chairman and chief executive between February 2017 and January 2020, led “to disastrous consequences”.
Bergin suggests the NSW Casino Control Act be amended to prevent any person from holding more than 10% of any licensee or holding company.
The Independent Liquor & Gaming Authority will consider the report and determine its own path forward.
It’s hard to see how Crown, as currently structured, can open the Sydney casino in the near future.
Read more: If Crown is unfit to hold a Sydney casino licence, what about Melbourne, and Perth?
Although the Sydney Barangaroo building is complete, gambling facilities have not been permitted to open.
The report raises obvious questions for the Victorian and Western Australian regulators.
To date there has been little to suggest that Victoria’s Commission for Gambling and Liquor Regulation has the wherewithal to take on Crown.
That has to change. As Greens spokesperson on gambling Senator Rachel Siewert said on reading the report, “we need to know what’s going on in Perth and Melbourne”.
Author: Charles Livingstone – Associate Professor, School of Public Health and Preventive Medicine, Monash University