Crown Resorts, the massive Australian casino operator, has been approved to keep its gaming license in New South Wales (NSW) following a corporate restructuring that the troubled company completed recently.
NSW gambling authorities announced on Tuesday that Crown has complied with regulations thanks to a new governance structure. The decision permits the business to keep its gaming license for Crown Sydney, an integrated resort in Barangaroo that cost AU$2.2 billion (US$1.4 billion) and debuted in late 2020.
August 2022 saw the start of table game activities in the ultra-luxury resort's casino. The absence of slots, sometimes known as pokies in Australia, is due to rival Star Entertainment's state monopoly on the game that will last until 2041.
Crown officials said that the firm invested more than AU$200 million to overhaul the gaming company’s internal controls. In August 2019, a state investigation in NSW questioned its compliance. State investigations in Victoria and Western Australia, where Crown operates Crown Melbourne and Crown Perth, respectively, were triggered by the NSW probe conducted before to the launch of Crown Sydney.
After state investigators in Western Australia, Victoria, and New South Wales concluded that Crown did little to prevent its casinos from being utilized by crime syndicates and unlawful gangs to launder money, the board and key management roles were virtually unilaterally replaced.
Blackstone Comes to the Aid
US-based private equity company Blackstone spotted a buying opportunity amid its regulatory probes and grave inquiry results, which also entailed Crown turning a blind eye when triads and other unsavoury characters visited its resorts. Blackstone, which has been optimistic about the gambling sector globally since the COVID-19 outbreak and has made a number of acquisitions on the Las Vegas Strip, demonstrated its vast pockets by acquiring the Australian casino operator in 2022 for AU$8.87 billion.
In exchange for the company paying over AU$680 million in federal and state fines for the company's money laundering violations, Blackstone promised to strengthen Crown's governance. But Crown has been able to maintain possession of all three of its casino licenses thus far.
The Victorian Gambling and Casino Control Commission declared Crown Melbourne appropriate last month. This week, Crown Sydney received a comparable endorsement from the NSW Independent Casino Commission (NICC).
"The NICC is confident the Crown we deemed suitable today has a strong model to keep operating into the future,” said NICC Chief Commissioner Philip Crawford.
Crawford, however, says the state commission will continue to keep close tabs on Crown Sydney.
"Hard work and transformation aside, the NICC has not forgotten the level of misconduct exposed when Crown was found unsuitable. Crown Sydney has ongoing work … and must continue to lift standards and maintain its cultural transformation,” Crawford added.
After taking over in October 2022, Crown Sydney CEO Mark McWhinnie declared that the casino was now "the safest place to gamble" in the state of New South Wales. According to McWhinnie, "432 remediation activities" have been carried out on the property to improve customer and staff safety and boost financial compliance.
Perth Is Still Uncertain
Only Crown Perth's future is still up in the air, as two of the three state inquiries determined that Crown Resorts' corporate modifications were sufficient to keep the company's Crown Melbourne and Crown Sydney licenses. The Western Australia casino is working toward completing its corrective action plan in time for the February 2025 deadline set by the Perth Casino Royal Commission.
“I am immensely proud of what our team has accomplished with two of our three properties being found suitable to retain their casino licenses and we continue to focus on our ongoing remediation work in Perth,” said Crown Resorts CEO Ciarán Carruthers. The chief executive was appointed to the position in July 2022.
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