Crown threatened to call in minister over watchdog’s money laundering push

Crown Resorts’ top legal officer threatened to call Victoria’s gaming minister to complain about the state’s gambling watchdog pushing it to implement new controls to guard against money laundering at its Melbourne casino.

Victorian Commission for Gaming and Liquor Regulation (VCGLR) licensing manager Jason Cremona told the state’s royal commission into Crown on Tuesday that the casino responded “pretty aggressively” to a letter he sent in May 2019 raising concerns it was failing to act on a key recommendation from its 2018 licence review.

Crown pushed back against measures to guard against money laundering, the commission has heard. Credit:Chris Hopkins

The recommendation – to collect more information about how many millions of dollars high-rollers on “junket” tours were gambling on Crown’s tables – needed to be implemented by July 1, 2019. But by May 2019 Crown had not taken any steps towards that, prompting the VCGLR to write to the group raising its concerns.

Mr Cremona said he received a phone call on May 23 from Crown representative Michelle Fielding, who told him Crown’s then chief legal office Joshua Preston was “furious” about the letter and would probably “call the minister to complain”.

“I was clearly taken aback by the tone, the aggressive nature,” Mr Cremona told the commission. “Referencing calling the minister is almost like: well we take offence to what you said and we are going to take action.”

Commissioner Ray Finkelstein, QC, asked if Mr Cremona thought Crown’s intention was to get the VCGLR to withdraw its requirement for Crown to act on the recommendation.

“Yes to an extent,” Mr Cremona responded. “But I was pretty solid in my position… there was no evidence Crown was taking any action to address recommendation 17 in line with our expectations.”

Mr Finkelstein: And [Crown was] threatening you for pushing it?

Mr Cremona: “Correct”.

Mr Preston left Crown last year after being grilled for several days at the NSW Bergin inquiry, which found the company was unfit to hold a casino licence. There is no evidence he called Victoria’s gaming minster, which at the time was Marlene Kairouz. She stepped down from cabinet last year after The Age and 60 Minutes reported on her involvement in a branch-stacking scandal. Ms Fielding remains at Crown in a senior legal role.

The commission heard on Tuesday that Crown told the VCGLR in correspondence and meetings that it considered a new anti-money laundering program being developing with the financial crimes watchdog AUSTRAC was more important than the “internal control statements” (ICS) the VCGLR had told it to implement.

Internal control statements are a set of rules, approved and enforced by the VCGLR, that govern how Crown operates.

At the time of the review, Crown did not track how much each individual member of a junket group – overseas groups of high-rollers who the casino pays to gamble – was outlaying. Instead, the casino only knew how much the entire junket group was putting up, which was usually many millions of dollars.

AUSTRAC has previously warned that this anonymity of junket players was a “key vulnerability” that facilitates money-laundering.

Mr Cremona said Crown had “absolutely” pushed back against the need to even implement the recommendation from 2018 onwards, and by May 2019 “alarm bells were ringing loudly” that Crown had taken none of the steps required by the recommendation, which included consulting with AUSTRAC and engaging an external consultant.

Last month the VCGLR fined Crown $1 million over the casino’s failure to vet its junket partners for criminal links and other probity issues. Victoria launched a royal commission into Crown Melbourne’s casino licence after the Bergin inquiry found that Crown was unfit to hold a licence in NSW because of money laundering, criminal infiltration and other probity issues at its Melbourne and Perth casinos.

A VCGLR compliance officer told the first day of the hearings on Monday that the casino giant’s executives lied to him during his investigation into the arrest of Crown staff in China in 2016.

Market Recap

A concise wrap of the day on the markets, breaking business news and expert opinion delivered to your inbox each afternoon. Sign up  Here.

Most Viewed in Business

From our partners

Source: Read Full Article