AUSTRALIAN CASINO REGULATION
These proceedings are current; a first case management hearing is scheduled for 13 February 2023. In these proceedings, AUSTRAC claims that there have been 547 contraventions of the AML/CTF Act by Crown Melbourne and Crown Perth (together), namely: • Breaches of Section 36(1) of the AML/CTF Act (which relate to ongoing customer due diligence): • 382 contraventions by Crown Melbourne; and • 165 contraventions by Crown Perth; and • Breaches of Section 81 of the AML/CTF Act (which relate to the adoption and maintenance of an AML/ CTF program) – the number of contraventions is too numerous to be quantified. Each contravention of the AML/CTF Act attracts a maximum civil penalty of between AU$18 million and AU$22.2 million, meaning that there is a theoretical possibility of a penalty being imposed against the Crown Group of an amount in excess of AU$12 billion. However, it is unlikely that the maximum penalty will be imposed. Indeed, it has been reported that Crown Resorts and AUSTRAC are in discussions to reach agreement on a Statement of Facts (which would include, among other matters, the number of contraventions of the AML/CTF Act as well as the amount of the penalty). Further, in the absence of agreement being reached between AUSTRAC and Crown Resorts, numerous defences are likely to be raised by the Crown Group. These recent regulatory investigations into, and disciplinary action taken against, the Crown Group has ultimately led to a broader review of the entire Australian casino sector. Indeed, Australian regulators have begun reviewing in closer detail the manner in which business has been conducted by other Australian casino operators, in particular: • The Star; • Reef Casino; • Ville Resort Casino; and • SkyCity Adelaide. The Star In a manner similar to the Crown Inquiries, and following the findings of the Crown Inquiries, various inquiries into The Star were convened during 2021, namely: • New South Wales:
An independent review (the Bell Review) into the suitability of The Star and its associates as being concerned in or associated with the management and operation of The Star casino in Sydney; and • Queensland: The External Review of the Queensland casinos of The Star (External Review), which inquired into: • the casino operations of The Star Gold Coast and Treasury Brisbane to examine whether those operations are consistent with the objectives of the Queensland casino legislation; • the suitability of each of the Star Group licensees to hold a casino licence and the Star Group to be associated with the operation of a casino in Queensland; and • whether enhanced regulatory measures relating to casinos are required in Queensland. In general terms, each of the Bell Review and the External Review found that The Star (and its subsidiaries) had engaged in conduct in breach of the relevant licence conditions and/or State legislation. Interestingly, neither the Bell Review nor the External Review came to a view as to whether The Star (and its casino licensee subsidiaries) was unsuitable to hold a casino licence and/or was not a suitable associate (as relevant). Rather, this determination was left to the relevant State Governments. In a manner similar to the Crown Inquiries, each of the Bell Review and the External Review made recommendations for The Star to remediate any breaches, and those recommendations have been accepted by the relevant gambling regulators (and State Governments). Ultimately, in response to the findings in each of the Bell Review and the External Review, each of the New South Wales regulator and the Queensland Government formed the view that The Star (and its casino licensee subsidiaries) was unsuitable to hold a casino licence and/or was not a suitable associate (as relevant) and took the following disciplinary action: New South Wales: The NSW Independent Casino Commission (NICC) suspended the casino licence of The Star Sydney for an indefinite period. In summary, the NICC concluded that The Star Sydney is not currently suitable to hold its Sydney licence and that it is no longer in the public interest that The Star Sydney remain in control of its Sydney casino. The licence suspension came into
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IMGL MAGAZINE | JANUARY 2023
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