Crown Suffers From Scandal As Public Hearings Near
Crown Resorts faces a massive decline in VIP turnover in the first three months of its new fiscal year. Now, its chief executive lashes out at activists, unverified whistleblowers, and overall unproven claims in this Crown scandal.
At the same time, Australia’s Border Force comes under scrutiny for the entry of a UN-banned arms dealer to the country to gamble at Crown Casino. Also, public hearings have begun to examine allegations of corruption at Crown Resorts.
VIP Decline Starts Rough Year
At the end of October Crown Executive Chairman John Alexander had to deliver a shareholder presentation. He had to talk about some of the figures from the first quarter financials. These are from the new fiscal year started July 1, 2019.
Those months were plagued by allegations of scandal and an intense spotlight on the high-stakes VIP gamblers who spend time and money at Crown establishments. The strong public and governmental weight on the VIP industry all but ended Crown’s relationships with junket operators.
Subsequently, the news delivered by Alexander was not exactly shocking. VIP turnover for the first three and a half months of the new fiscal year was down 46%.
Gaming floor revenue was up 2% as compared with the previous year, but non-gaming revenue was flat. And online social gaming revenue was down 4% for Betfair Australasia and DGN.
As for the VIP dip, Alexander blamed much of it on a slowing Chinese economy spurred by the trade war with the United States that has hurt Chinese high rollers.
Alexander Claps Back
The head of Crown Resorts has not been shy about expressing his displeasure with media reports of the scandal and the ensuing stories. It was not surprising that he took some serious shots at that media during his shareholder meeting last month.
According to Inside Asian Gaming, Alexander said, “There are a number of interests and activists who continue to pursue an anti-Crown agenda.”
And about the media’s role in it all, Alexander added, “As someone who has 50 years’ experience in journalism and media management … I have never seen a quality news organization publish a story it openly admits it hasn’t been able to verify.”
Alexander reiterated that Crown does not tolerate any illegal activity by anyone associated with the company, whether employees or customers. “Crown has no interest in being used by those who seek to do the wrong thing,” he said, per an ABC News report.
He admitted that the allegations have caused some concern among stakeholders. But Alexander called those allegations “sensationalist”. He then added, “I can personally assure you we are taking these matters seriously”.
However, there was no transcript or recording of the meeting at which Alexander discussed the matters with his shareholders.
Border Force Under Scrutiny
One situation that had lawmakers scrambling to investigate further was the report in October that Joseph Wong Kiia Tai had been a visitor to Crown Perth and Crown Melbourne. At the same time, he was on an international travel ban list.
Tai had been an arms dealer with connections to Liberian war criminal Charles Taylor. The UN Security Council Committee found that Tai had provided military and financial support to Taylor. They froze his assets and issued an international travel ban on him in 2011, and it was active through 2015.
But during this time, Tai flew into Australia enough times to lost more than $6 million at Crown during several casino visits.
Victoria Gaming Minister Marlene Kairouz said the Border Force was to blame for the errors, not state authorities. That led to former Border Force head Roman Quaedvlieg having to testify in the Crown corruption hearings.
The Organized Crime and Corruption Reporting Project wrote that Quaedvlieg claimed two ministers and an MP lobbied him to “smooth out” the border security process so that Chinese gamblers and others could get to Crown Resorts without trouble. They wanted VIP players to “land on a private jet at Melbourne airport, receive the minimal amount of clearances, put them in cars, get them into the casino to spend money”.
Public Hearings Pending
The Australian Commission for Law Enforcement Integrity (ACLEI) was due to start public hearings on October 29. But there has been a delay for an undetermined period of time.
According to the ACLEI website, public hearings regarding interactions between Crown Resorts and the Department of Home Affairs “have been delayed until further notice.” The media release stated that the availability of a key witness was in doubt, while more key witnesses had recently come forward with new information.
The ACLEI will update the public with new dates for the hearings as soon as they are available. Meanwhile, the list of witnesses seems to be growing, indicating that hearings may continue on toward the holidays.
