Jan 17, 2020 Newsdesk Latest News, Top of the deck, World
The gaming regulator in New South Wales says the first hearing of an investigation on whether casino firm Crown Resorts Ltd breached its gaming licence for its Barangaroo project in that Australian state is to take place on Tuesday, January 21. Authorities are said to be looking particularly at the decision of Crown Resorts’ largest shareholder to sell a 19.9 percent stake in the company to Asian casino operator Melco Resorts and Entertainment Ltd.
Crown Resorts is developing – at Barangaroo in Sydney, in that state – what will be its third Australian casino resort. Australian billionaire James Packer – who controls the largest shareholder in Crown Resorts - said earlier this month that the Crown Sydney project (pictured in a rendering) might open by Christmas this year, ahead of the previously-announced first-half 2021 target.
The New South Wales Independent Liquor and Gaming Authority (ILGA) published in August the “terms of reference” for its inquiry, saying that it would probe whether the transfer of shares in Crown Resorts to Melco Resorts constituted a “breach” of the restricted gaming licence or any other regulatory agreement. The inquiry is headed by former judge Patricia Bergin.
Mr Packer was quoted this month by The Australian newspaper as saying – in a reference to the regulator’s investigation – that the next 12 months would be “challenging”, with some “issues to be resolved”. The entrepreneur also said he would attend the public inquiry if he was called.
The hearings will look at whether Melco Resorts and Mr Ho – or other Melco Resorts representatives that could join the board of the Australian gaming firm following the share purchase – are of “good repute, having regard to character, honesty and integrity”; “have any business association with any person, body or association who is not of good repute”; and “are otherwise not suitable to be associated” with the wholly-owned unit of Crown Resorts that holds the gaming licence in New South Wales.
The regulator said additionally that the probe ought to review whether Crown Resorts should be allowed to retain the licence to operate a casino in Sydney. Aside from the probe into the share sale, the ILGA will also review the suitability of Crown Resorts in light of media reports alleging that the company was involved in criminal activities.
The probe will investigate whether Crown Resorts engaged in money laundering, breached gambling laws or partnered with junket operators with links to criminal activities. Crown Resorts has denied the claims.
Melco Resorts, a company controlled by gaming entrepreneur Lawrence Ho Yau Lung, announced in May that it was paying US$1.2 billion to acquire – in two instalments – a 19.99-percent stake in Crown Resorts. CPH Crown Holdings Pty Ltd – controlled by Mr Packer – is the seller.
Under the original agreement, the closing of the first tranche of 67,675,000 shares – equivalent to a nearly 10 percent stake – of Crown Resorts occurred on June 6. The closing of the second tranche was scheduled to occur on or prior to September 30, but the involved parties announced the deferral of the acquisition of that second tranche of shares in Crown Resorts.
Melco Resorts said in an August announcement that the parties decided to postpone the acquisition of the second tranche of Crown Resorts shares “to allow more time for the relevant Australian regulatory processes to be completed”. The company said in a statement sent to GGRAsia at the time that it would participate “in any probity review process and cooperate with any inquiry” that was required in relation to its investment in Crown Resorts.
Crown Resorts also faces a separate inquiry by the Australian Commission for Law Enforcement Integrity, which main role is to investigate corruption within law enforcement bodies.
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