Star Casino Money Laundering Scandal Explained

Star Entertainment is a gambling and entertainment company headquartered in Brisbane, Australia. Star is a publicly traded company on the Australian stock exchange under the stock symbol “SGR.”

The company had revenues of $2.3 billion (Australian) and employs 8,000 people. The chairman is John O’Neill.

The casinos owned by Star are the Treasury Casino Hotel, The Star Gold Coast and The Star, Sydney.

Star Entertainment is partially owned by Chow Tai Fook Enterprises and Far East Consortium, who are based in Hong Kong.

Star Entertainment was accused in 2022 of facilitating money laundering at its casinos and was fined a record amount by the government of Australia after a series of investigations.

History Of Australian Gambling Corruption

There is a history of corruption associated with the casino industry in Australia.

In 2021 an inquiry found that criminal activity occurred at casinos owned by Crown Resorts in Australia (owned by Australian billionaire James Packer).

The investigation found that Crown had been “facilitating money laundering, exposing staff to the risk of detention in a foreign jurisdiction and pursuing commercial relationships with individuals” who were connected to criminal groups.

After the scandal, Crown Resorts CEO Ken Barton resigned from his position with the company in February 2021.

Both Crown Resorts and Star announced in response to the investigation that they would make their gaming operations cashless.

The Star Gold Coast Casino
The Star Gold Coast Casino

Allegations Against Star

The allegations against Star involved claims that the company allowed patrons of the casino to divert funds through their China UnionPay accounts and put into credits for their hotel rooms.

Those patrons would then be allegedly accompanied by a VIP host and be able to take a receipt to a cage at the hotel and exchange the receipt for cash or chips that could be used.

The Guardian reported that evidence suggested that $55 million passed through Star’s casinos in Queensland using this process of purported money laundering.

An inquiry found that Star allowed a customer with alleged links to the Italian ’Ndrangheta mafia to gamble at its casino in Queensland.

Rolex Submariner Watch
Rolex Submariner Watch

The man was banned from the Crown Melbourne Casino in 2014 but was allowed to continue gambling with Star.

The inquiry also heard testimony that a high roller gambler was given a $50,000 Rolex watch by the Star casino even though he was banned from The Star casino in Sydney.

Casino Regulator’s Lax Prosecutions

Queensland has more casinos than any other state or territory in Australia.

The Office of Liquor and Gaming Regulation (OLGR) is the governmental body overseeing gambling in casinos located in Queensland.

A whistleblower told ABC News in September 2022 that the regulator responsible for the Queensland casino industry, where Star Gold Coast was located, was “asleep at the wheel” in providing oversight of gambling.

The insider told the outlet, “There’s no doubt about it, the Queensland regulator has clearly failed to deter, prevent and detect serious crime occurring in Queensland casinos and it’s failed to protect vulnerable people from harm associated with gambling.”

ABC reported that from 2017 to 2022, no casino operators in the Queensland region have been prosecuted.

In a September 2022 column, Financial Review criticized the lack of criminal charges over casino money laundering in Australia.

The publication wrote, “But so far, there have been no money laundering-related prosecutions, despite evidence of blatant money laundering and facilitation of cleaning cash illegally over the past seven to eight years at Star and Crown.”

“The lack of prosecutions for facilitating money laundering back up the argument that state governments regard the gaming and wagering industry as a protected species.”

Star Entertainment Group Bell Report

Adam Bell led an inquiry into Star Entertainment’s properties in New South Wales. In September 2022 the details of the inquiry were released.

The inquiry heard allegations that Star was involved in money laundering, organized crime, and fraud.

New South Wales (NSW) Independent Casino Commission chief Philip Crawford
New South Wales (NSW) Independent Casino Commission chief Philip Crawford

The Bell report determined that Star was “unsuitable” to hold a license to operate a casino in New South Wales. The report said they found breaches of Australia’s Casino Control Act when examining Star’s actions.

New South Wales (NSW) Independent Casino Commission chief Philip Crawford said that the report showed that Star “tended to ignore” risks associated with their business conduct and that the company “tried to hide” the results.

Crawford said the report also showed “very real risks of criminal infiltration” in Star’s operations and that the company’s policies against money laundering were “unsatisfactory.”

Queensland Attorney General Shannon Fentiman
Queensland Attorney General Shannon Fentiman

Star Entertainment Group Gotterson Report

Former appeal court judge Robert Gotterson was called in to conduct a review of Star’s suitability to keep its casino licenses. The review was ordered by Queensland Attorney General Shannon Fentiman in June 2022.

The inquiry began in August 2022.

Gotterson released a report of his findings on October 5 2022.

Fentiman responded to the report writing, “After considering the findings of Robert Gotterson AO KC’s report into The Star, I have formed the view that The Star is unsuitable to hold a casino license in Qld. A show-cause process will now commence.”

Resignations

CEO Matt Bekier resigned from the company after revelations in the Bergin money laundering inquiry.

Video: 60 Minutes Australia investigation of Star Casino

Star Inquiry Response

In response to the Bergin inquiry, Star said they would address issues that were brought up.

In a public statement, the company said, “We have taken significant and urgent remedial steps and would do whatever necessary to restore its suitability to run the casino.”

Star Casinos Fined

On October 17 2022 it was announced that Star Entertainment would be fined $62 million ($100 million Australian dollars) for failing to prevent money laundering at its casino based in Sydney.

The fine was a record fine for a casino operator in Australia.

New South Wales (NSW) Independent Casino Commission chief Philip Crawford said, “From Friday, the Star will not be able to run the casino on its own until it can ‘earn’ its license back.”

Crawford said the commission decided not to revoke Star’s license and claimed that the company was contrite following the release of the inquiry results. He also noted that the company is a large employer in the region.

“A big issue for us, to be frank, in this environment is that there is probably about 10,000 employees of the Star casino, and a lot of them rely on the income to pay their mortgages and raise their kids.”

The commission appointed Nick Weeks of Wexsted Advisors to be the manager of Star’s casino in Pyrmont for at least 90 days.

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