The pressure on Crown Resorts to delay the opening of its casino at Barangaroo in Sydney has intensified after a senior state minister said he was “encouraged” the regulator was taking steps to consider the matter next week.
Crown has announced it plans to open the $2bn high roller casino and hotel complex on 14 December, and reaffirmed it two weeks ago at its annual general meeting, despite being midway through a major inquiry into the group’s continued suitability to hold a licence. The inquiry is not due to report its findings until 1 February.
But New South Wales government ministers and the chair of the inquiry, Patricia Bergin SC, have delivered broad hints that Crown should consider delaying the gala opening – at least of the casino.
“I am receiving regular updates from [the Independent Liquor and Gaming Authority] and am encouraged that they have now scheduled a special meeting for 18 November to attempt to resolve the conditions of Crown Sydney’s opening in December,” the minister responsible for gaming, Victor Dominello, said on Monday.
“At that meeting ILGA will consider the opening of Crown Sydney’s gaming operations, including possible limited or restricted opening scenarios,” he said.
The premier, Gladys Berejiklian, said last week she is prepared to do whatever the ILGA recommends, noting that a casino licence carries responsibilities to the community.
Bergin has commented during the inquiry that it might be prudent to delay the opening, and counsel assisting, Naomi Sharp SC, has said the steps Crown has taken to remedy the problems identified have been “too little too late”.
But Crown has shown no signs of backing down on the 14 December date.
This is despite final submissions from Sharp asserting that “Crown Sydney is not suitable … to hold the licence and Crown Resorts is not suitable to be a close associate of the licensee”.
One of the key factors identified is the culture of Crown.
“We say that the failure of Crown Resorts to meaningfully act on these longstanding allegations about the junket operators bespeaks both a culture of denial and a culture of arrogant indifference to regulatory compliance,” she said on Friday.
At its meeting next week, the ILGA could potentially suspend the licence or direct Crown not to open. Crown already holds a licence and must remain suitable at all times.
But this could set the scene for a major showdown – and possible litigation – as Crown has several agreements with the NSW government that purport to limit the regulator’s ability to act in a way that would have an adverse economic effect on Crown.
Crown has also not yet had an opportunity to rebut the submissions made before the inquiry.
Summing up on Monday, Sharp sought to underline the multiple “specific failings and shortcomings” of Crown that had emerged from the inquiry
These included:
The activities in China that culminated in the arrest of 19 staff in 2016
The sale of shares to Melco Resorts in 2019, which gave rise to a breach of the Sydney licence
The relationship with junkets that Crown could not be satisfied were of good reputation
A failure of the anti-money-laundering systems at Crown Melbourne and Perth
The relationship with the major shareholder [James Packer], which had a deleterious effect on the company
These, she said, were “case studies” that showed the failure of Crown to set a risk appetite and to manage risk. Each demonstrated the board’s failure “to exercise active stewardship” of the company, she said.
But so far there is no sign of a shift in plans from Crown despite the warning signs that Crown’s culture – and its willingness to make changes to its operations – will be a key consideration by the ILGA.
Crown’s counsel, Neil Young SC, said he will not conclude his submissions rebutting the damning allegations against Crown until next Friday, which means the ILGA’s meeting will take place before he has finished putting his case.
Bergin said she would sit longer hours if required.
Behind the scenes there has already been a letter from the Crown legal representatives to counsel assisting alleging breaches of due process.
Advisers within Crown are split between being more conciliatory toward the ILGA or taking a hard legal approach. Crown is also facing a shareholder class action and action from its staff arrested in China.
The inquiry continues on Tuesday with submissions from parties other than Crown.