NSW Independent Casino Commission Says License Revocation Would Mean Overnight Loss of Thousands of Employees

New South Wales casino regulators have found Star Entertainment to be unfit to hold a license because of violations that included facilitating money laundering by customers and allowing junket operators with ties to organized crime to bring in big-money gamblers. The board defended its decision to allow the licensee to retain the license even though it determined that the licensee was not fit to do so.

This post comes shortly after the NSW Independent Casino Commission imposed a hefty fine of $100 million on Star and appointed Nick Weeks of Wexted Advisors as manager to oversee the company's Pyrmont casino for a minimum of 90 days.

NSICC Chairman Philip Crawford said that regulators decided not to revoke Star's license because the company had shown penitence and a willingness to reform under its new CEO, Robby Cook, and that revoking the casino license would be "a major blow to thousands of The revocation of the casino license would have meant "thousands of star employees losing their jobs overnight," he said.

He said, "Frankly, the big problem for us in this environment is that there are probably about 10,000 Star Casino employees, many of whom are relying on their income from rsabet.co.za to pay their mortgages and raise their children."

Charles Livingston, a Monash University gambling researcher and longtime critic of Australia's casino industry, said the fine was "not appropriate.

He said, "$100 million is a lot of money for anyone, but for the casinos it's more than a slap on the wrist.

He said a similar $100 million fine recently imposed on Crown Resorts by Victoria's casino regulator was simply factored into the amount paid by U.S. private equity group Blackstone for the acquisition.

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'They didn't even blink. 'What would they have to do to lose their license?

It's amazing that no one has ever been held personally liable for Star's actions, he said.

'If we were equally culpable as private citizens, we'd be in a big house, but no one seems to have been held accountable,' he said.

Australia's casino industry has been the subject of multiple investigations around the country since 2019, when Nine Entertainment revealed money laundering and criminal infiltration of junkets at Crown Resorts, a major rival of Star.

In September, an investigation conducted by senior attorney Adam Bell for the NICC found Star to be unsuitable to hold a casino license.

Bell found that Star staff operated a scheme to disguise $900 million in gambling transactions by customers using China UnionPay cards as other expenditures, and when the NAB challenged the matter, Star gave "brazen and intentionally misleading" answers to the bank.

The company had also allowed junket operator Sun City to operate a high roller room known as "Salon 95." Sun City was controlled by Alvin Chau, who is on trial in Macau on charges of illegal gambling, criminal association, fraud, and money laundering.

According to Bell, Star should have closed Salon 95 in June 2018 due to growing concerns about cash transactions in the room, but instead kept it open.

Bell said in his report that "this was a collective decision by Star's senior management that reflected a culture in which business goals were overly prioritized over regulatory, money laundering, and terrorism financing risks."

Bell also raised concerns about management's attitude toward his investigation, arguing that important documents should not be handed over because they are subject to legal privilege. Skip Past Newsletter Promotions

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But on Monday, Crawford said that after a string of resignations from the company, including the departure of CEO Matt Bechia, the company now "expresses contrition and wants to work with us.

'This is a big change. It has been very hostile and has not treated regulators with the respect it should have."

New South Wales Premier Dominic Perotet welcomed the regulator's decision and said Star's license will not be renewed until the casino is in compliance.

The Star casino under construction in Brisbane.

Star is "unsuitable" to hold a casino license in Queensland, the state government

Read more.

"We are not going to have a situation where any company in our state is not following the prescribed rules and regulations. What is clear today is that the process we have in place is very strong, that we have a strong regulator, and that we welcome today's decision."

'My expectation is that obviously the license will not be renewed until the circumstances are in place for them to comply.

The next hurdle for Starr is dealing with Queensland regulators. Earlier this month, the state's attorney general declared the company ineligible to hold a casino license following an investigation that found the company violated its anti-money laundering obligations and willfully misled regulators.

In addition, the Queensland government introduced legislative changes to allow Star to appoint a special manager to operate its Gold Coast and Brisbane casinos, but this authority has not yet been used. The company has been issued a show cause notice to explain why it should be allowed to continue operating in Queensland.

Mr. Livingstone said that the study has made it clear that a national casino regulatory regime is needed.

He stated that "casinos are a national industry and need to be regulated on a national level by a national regulator."

 This article was revised on October 17, 2022. An earlier version of this article stated that a special manager had been appointed to run Star's Gold Coast and Brisbane casinos, but the appointment has not yet been made, although the law was amended to define the role.

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