Former Star Entertainment Group Managing Director and CEO Matt Bekier has been ordered to pay a pecuniary penalty of AU$700,000 ($495,000) and be disqualified from managing corporations for six years by Australia’s Federal Court over governance failures linked to Suncity Group and China UnionPay card transactions.
The penalty judgment, delivered by Justice Michael Lee on June 17th, follows earlier findings that Bekier breached his duty of care and diligence under section 180(1) of the Corporations Act. The court found the failures related to Star’s dealings with junkets, particularly Macau-based Suncity, and with its principal banker, National Australia Bank, over the use of China UnionPay (CUP) cards.
Bekier was the most senior member of Star’s management and acted as a key link between the board and the executive team. His responsibilities included taking reasonable steps to ensure the board was informed of matters exposing Star to legal, financial or reputational risks.
Justice Lee said the contraventions were serious, although they did not involve personal enrichment. The judgment found that Bekier failed to respond appropriately to information concerning legal, regulatory and reputational risks in Star’s junket operations and banking arrangements.
On the CUP issue, the court said Bekier knew that a statement in a warning letter claiming that the transactions did not include any gambling component was false. After receiving that letter, he failed to request all of Star’s communications with NAB regarding CUP cards. Justice Lee said Bekier ‘should have got to the bottom of this by demanding access to all material.’
The court also took into account parity with earlier penalties imposed on other former Star executives. ASIC had sought a penalty of AU$1.3 million ($919,000) and an eight-year disqualification against Bekier, while Bekier argued for a shorter ban and a penalty of no more than AU$240,000 ($170,000).
Former Star Company Secretary, Group General Counsel and Chief Legal and Risk Officer Paula Martin was also ordered to pay a pecuniary penalty of AU$400,000 ($283,000) and be disqualified from managing corporations for seven years.
