Crown ordered to pay AU$22.5m following Bergin Inquiry
Crown Resorts Melbourne has been ordered to pay a total of AUD $22.5m (£12.4m/€14.4m/$17.3m) as part of measures set out by the New South Wales Independent Liquor and Gaming Authority (IGLA). Crown must pay $12.5m towards the inquiry itself, and also pay an annual Casino Supervisory Levy of $5.0m in both FY2021 and FY2022, after the regulator found Crown “unsuitable” to operate a casino in the Barangaroo district of Sydney in February. The operator may pay a further levy in FY2023, but this is “subject to further consultation”.
In order to eradicate potential fraud, Crown must equip all its casino gaming with card technology and not accept cash.
In addition, it must cease all international junket operations, which the operator says it has already done.
The ILGA noted that the business was “making significant progress” already towards being a suitable licensee.
“Crown, through its Executive Chair Helen Coonan, is addressing many of the issues which caused Commissioner Bergin to find..
Crown Resorts Melbourne has been ordered to pay a total of AUD $22.5m (£12.4m/€14.4m/$17.3m) as part of measures set out by the New South Wales Independent Liquor and Gaming Authority (IGLA).
Crown must pay $12.5m towards the inquiry itself, and also pay an annual Casino Supervisory Levy of $5.0m in both FY2021 and FY2022, after the regulator found Crown “unsuitable” to operate a casino in the Barangaroo district of Sydney in February. The operator may pay a further levy in FY2023, but this is “subject to further consultation”.
In order to eradicate potential fraud, Crown must equip all its casino gaming with card technology and not accept cash.
In addition, it must cease all international junket operations, which the operator says it has already done.
The ILGA noted that the business was “making significant progress” already towards being a suitable licensee.
“Crown, through its Executive Chair Helen Coonan, is addressing many of the issues which caused Commissioner Bergin to find that it was unsuitable to hold a casino licence in NSW,” said ILGA chair Philip Crawford. “The Authority has also entered into an agreement with CPH to address issues around its influence and control over the management of Crown.”
Helen Coonan, Crown’s executive chairman, said the ILGA’s recognition of its progress was a positive sign that it would be permitted to operate the Barangaroo casino.
“While we recognise we have more work to do, we welcome ILGA’s indication today that Crown’s reform implementation is well-advanced towards suitability to operate gaming at Crown Sydney.” said Helen Coonan, Crown’s executive chairman.
“It’s important to know we are well on track but I have assured the regulator there will be no complacency as we continue to embed the changes to improve our governance and compliance processes across the organisation.”
The Bergin Inquiry began when the New South Wales ILGA launched a probe into Asian gaming giant Melco Resorts & Entertainment Limited’s purchase of shares in CPH Crown Holdings.
Melco later backed out of the deal, but the Inquiry continued.
The Inquiry assessed Crown’s suitability as a licensee for a new resort at Barangaroo in Sydney, and uncovered money laundering and organised crime connections within Crown and its dealings with Asia-based junket operators.
While it said that Crown was “unsuitable” to operate the casino as is, it added that it may be suitable after undergoing changes.
Crown chief executive Ken Barton stepped down after the findings of the Inquiry were released in February. Further senior Crown executives and directors also resigned as a result.
The Victoria state authority then launched its own investigation into flagship resort Crown Melbourne’s suitability to have a casino license in that state.
In March, private equity group Blackstone put forward a bid to acquire Crown for AUD$8.02bn (£4.47bn/€5.21bn/US$6.19bn). The group later added a clause dissolving the deal if either of Crown’s licenscs were suspended, or if Crown did not receive a New South Wales licence.
This week, rival land-based operator Star Entertainment Group proposed a merger with Crown that would create an estimated combined operation amount of AUD$12.00bn (£6.71bn/€7.76bn/US$9.43bn).
