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Crown Resorts found unsuitable to hold Melbourne license, two years to clean up act

Crown Resorts has been found unsuitable to hold a casino license in Victoria, but has been allowed to keep its license and operate for now whilst it “cleans up its act.” 

In a 652-page royal commission report, which was tabled to the Victorian government on Tuesday morning, a total of 33 recommendations were given, all of which have been accepted by the Victorian government. 

Commissioner Raymond Finkelstein, QC said that the economic role that Crown played in Melbourne and the fact that it had already started its reform process “tipped the balance” against completely canceling the license. 

Finklestein has recommended that Crown should be allowed to continue operating for a two-year grace period, during which time it will be under close scrutiny from an external monitor, most likely a firm. 

The manager would have the privileges of a director of the casino’s board, but will not have a right to vote. The monitor would also have the power to direct the board to do, or not do something. The manager would also be allowed to attend board meetings, management meetings, inspect the company’s books, and compel people inside the company to give them information. Reports from the manager will also be sent to the Victorian gaming minister. 

After two years, the special manager will recommend to the regulator whether Crown should keep its Victorian casino license. 

“For the next two years, the ultimate decision-maker at Crown Melbourne will be a Special Manager. This manager, most likely a firm, will oversee all aspects of the casino’s operations.

“It will keep a watchful eye on the progress of reform. It will make sure that all rules and regulations are complied with. It will investigate particular aspects of the casino’s operations.”

Finkelstein warned that “this will be a tough test to satisfy”.

The inquiries into Crown were triggered by an investigative report by Australian media outlets, 60 minutes, The Age and Sydney Morning Herald that aired in 2019. After digging into the arrest of Crown employees in China, they uncovered instances of money laundering in the company’s casinos, as well as hosting VIPs with links to organized crime, drug trafficking, and sex trafficking rings.

The royal commission then uncovered further anti-money laundering failings, responsible gambling inadequacies, failures in corporate governance, and the failure to pay a multi-million dollar state gambling tax bill. 

“The catalog of wrongdoing is alarming, all the more so because it was engaged in by a regulated entity whose privilege to hold a casino license is dependent upon it being, at all times, a person of good character, honesty and integrity,” wrote Finkelstein.

“It is difficult to grade the seriousness of the misconduct. Some were so callous that it is hard to imagine it could be engaged in by such a well-known corporation whose Melbourne Casino Complex is visited by millions annually.”

Finklestein also took aim at the executives and directors involved with the company’s misconduct, noting that “no one connected with the organization is entitled to much sympathy”.

Included in the report is also a recommendation for James Packer to slash his share in the company to just 5 percent, down from 37 percent. 

Felix Ng
Felix Ng
Felix is the Asia Editor and Events Director of the Asia Gaming Brief. He has over a decade of experience developing conferences for industries including gaming, telecoms, investment, biotechnology, and mining. Felix covers gaming technology and innovation and is passionate about developing engaging and eye-catching content for the industry.