Crown Resorts: Third License Revoked

Money laundering scandal comes to a head

The ILGA has made a decision on the question of whether Crown is suitable for a third casino license: Due to the increasingly escalating money laundering affair, the Australian market giant's license, which was granted in 2014, was temporarily revoked. The doors to the $2.4 billion casino in Barangaroo, which was supposed to open next month, remain closed.

After CEO Ken Barton first admitted security gaps in business processes in September, more details about the dubious partnerships of former managing director James Packer have come to light in recent weeks. The company has since admitted that criminal groups likely laundered dirty money through Crown's bank accounts. Australian media reports at least two accounts.

It was disappointing that Crown did not delay the opening on its own, said Philip Crawford, chair of the ILGA, at a special meeting on Wednesday (11/18). In any case, the investigation would continue until next year, and the third Crown license should therefore be withdrawn. They don't feel comfortable granting the company another casino. The revelations would cause ILGA great concern.

As the investigations show, the Crown scandal has continued to escalate over the last 12 months and the facts of the case have become more and more intensified. Crown's lawyer Robert Craig had admitted that Crown had deposited funds into its Riverbank and Southbank accounts that were intended to be laundered. Crawford explained that it could possibly be drug money, and also spoke of child sexual exploitation, human trafficking and the financing of terrorism. The extent of this cannot yet be predicted.

What are the backgrounds?

The Crown investigation was launched in November 2019 by an investigative report by Australian newspapers The Sydney Morning Herald, The Age and 60 Minutes. With the help of a dubious Chinese junket operator partner (Suncity), Crown is said to have recruited super-rich VIP players from China who, within a short period of time, wagered millions of dollars at Crown Casino Melbourne.

Junket operators are agencies responsible for recruiting wealthy casino guests. They accompany potential customers on organized gambling trips, look after their funds and provide information about the high chances of winning. In principle, the activity is permitted in Australia. However, customers from countries where gambling is prohibited, such as China, may not be recruited.

In addition, Suncity had been suspected of cooperating with Chinese syndicates since 2014. In this context, there was talk of an illegal organization called The Company. The group is said to have infiltrated the Crown Casinos in Melbourne and Perth and laundered money there. The newspapers primarily referred to thousands of secret emails and information from insiders.

Further allegations relate to the transactions between the former CEO James Packer and Lawrence Ho, the owner of the gaming group Melco (Hong Kong). His father, Stanley Ho, is also said to have cooperated with organized crime syndicates. Despite an express ban, Packer is said to have attempted to conduct stock trades with Ho, which already put Crown's third license in jeopardy. According to the license agreement, Crown was not allowed to have any business relationships with people or companies associated with the ex-Melco CEO.

How are the investigations continuing?

The ILGA special committee told the Australian newspaper SMH that they were concerned and would now examine the group's bank accounts more closely. Furthermore, it must be checked whether and to what extent the share deals between James Packer and Lawrence Ho violate the license requirements. In addition, the Australian consulate, which is responsible for issuing Visa, is also said to have been involved in the business.

The circles are so wide that even the names of a senior Labor MP and a Chinese businessman flash on ILGA's radar. The private jet from Crown is said to have been made available to both of them on several occasions for private flights. The politician is Jamie Clements, former Labor general secretary of the Australian state of New South Wales (NSW). With the Chinese billionaire real estate dealer Huang Xiangmo.

Meanwhile, Suncity owner Alvin Chau has expanded elsewhere. He recently increased his shares in the Tigre de Cristal Casino in Russia and now owns over 77 percent of the Russian establishment. Since this is only around 150 kilometers from the border with China, experts assume that Chinese customers will be brought to the casino in the future.

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