Black on white
Crown Resorts has received official confirmation from the New South Wales (NSW) gambling regulator that it is not suitable to operate its casino in Barangaroo, Sydney through its gaming license.
The casino company issued an Australian Stock Exchange (ASX) statement on Tuesday, acknowledging that it received a letter from the NSW Independent Liquor and Gaming Authority (ILGA) about the matter. As per section 143 in the Casino Control Act 1992 (NSW), the ILGA currently deems that the Crown Sydney Gaming Pty Ltd subsidiary of Crown Resorts is unsuitable to use its Restricted Gaming License.
a licensee must remain a suitable person at all times
The casino company is also said to have broken clause 14(a) of the NSW VIP Gaming Management Agreement. This clause states that a licensee must remain a suitable person at all times “to give effect to the Restricted Gaming License and the Gaming Legislation.” According to the ASX statement, the ILGA has started a consultation process regarding the breach. Crown Resorts will be able to provide a response during this process.
A damning report
Official confirmation that Crown Resorts is not a suitable license holder in Sydney did not come as a surprise. Last week, the authorities released the long-awaited Bergin report regarding the issue.
facilitation of money laundering and links to organized crime
The 751-page report by the NSW inquiry lead Patricia Bergin concluded that the casino company is not suitable to operate a casino at its newly developed AU$2.2bn (US$1.7bn) Barangaroo casino until significant changes occur. Some of the reasons cited include the facilitation of money laundering and links to organized crime.
Since the release of the report, a number of Crown Resorts officials have resigned, including CEO Ken Barton. Three directors have also handed in their resignations – Guy Jalland, Michael Johnston, and Andrew Demetriou. While she did not give any specific details, Crown Resorts chair and interim CEO Helen Coonan promised to conduct significant changes at the company.
Necessary changes due
Until it makes the necessary changes, Crown Resorts will not be able to operate its casino in Sydney, but it can keep the hotel and restaurants running at the new property that opened in December 2020. Speaking about what the company needs to do to become suitable, ILGA chair Philip Crawford said: “It needs a lot of change. A lot of concern we have with the links to organised crime.”
The Bergin report outlined significant changes that would be necessary before Crown might once again become a suitable gaming operator and licensee. A restructuring of the company’s board is one requirement, along with a comprehensive financial audit to make sure that no criminal connections exist.
Bergin also called for major shareholder James Packer to stop “remote maneuvering”. While Packer is not a Crown Resorts board member, the report alleged that he wields significant influence over company directors.