The suitability of Crown Resorts to retain a gaming license for its AU$2.2 billion Crown Sydney is among the key issues to be investigated by an inquiry into Melco Resorts’ acquisition of a 19.99% stake in the Australian casino operator
Details of the inquiry, originally announced on 8 August, were released by the NSW Independent Liquor and Gaming Authority on Friday with Patricia Bergin SC named to look into a range of issues surrounding the transaction.
They include whether Crown remains a suitable person to retain its restricted gaming license for the Barangaroo development, due to open in 2021, and whether the disposal of shares to Melco Resorts constitutes a breach of the license or any other regulatory agreement.
In outlining the focus of its inquiry, the Independent Liquor and Gaming Authority confirmed the inquiry was being conducted in response to recent Australian media reports which “raised various allegations into the conduct of Crown Resorts and its alleged associates and business partners and raised questions as to whether the Licensee remains a suitable person to hold a restricted gaming license for the purposes of the Casino Control Act.”
Those reports include allegations that Crown Resorts or its agents or affiliates engaged in money-laundering, breached gambling laws and partnered with junket operators with links to drug traffickers, money launderers, human traffickers and organized crime groups. The reports have also questioned Melco’s acquisition of a stake in Crown due to Melco’s Chairman and CEO Lawrence Ho being the son of Macau casino magnate Dr Stanley Ho, with whom Crown is prohibited from conducting business as per a 2014 agreement with the regulator.
Referencing what it calls the “Melco Changes”, the regulator said on Friday that the Commissioner is required to inquire into and report upon the “the identity of any person who has or will become a close associate of the Licensee,” whether that person is “of good repute, having regard to character, honesty and integrity” and whether they “have any business association with any person, body or association who is not of good repute, having regard to character, honesty, integrity, or has undesirable or unsatisfactory financial sources.”
Melco announced last week announced that it has put its acquisition of the second tranche of Crown Resorts shares on hold until the inquiry is completed, having acquired the first tranche in 6 June.
IAG has previously criticized elements of the recent Australian media coverage of Crown Resorts, describing it as over-dramatized and questioning the backgrounds and motivations of some of the sources used in the reporting.
