The Australian financial crime watchdog warned Crown Resorts in June 2017 that the boss of one of its high-roller junket partners was a foreign “politically-exposed person” with a criminal history, a NSW inquiry into the casino operator has heard.
Some two years later, the organisation’s board signed an Australian stock exchange statement falsely stating the same partner, SunCity, was regulated and had a parent company listed on the Hong Kong Stock Exchange.
On Tuesday, Crown chair and former federal Liberal senator Helen Coonan continued giving evidence at the NSW gaming regulator’s inquiry into whether Crown is suitable to operate a new casino in Sydney.
It follows media allegations in 2019 that Crown turned a blind eye to money laundering by organised crime figures, and the attempted sale of 19.99 per cent of its stock from mogul James Packer’s private company to Melco Resorts.
Melco was run by the son of since-deceased Macau gambling king Stanley Ho, with whom Crown was banned from associating by the NSW government.
Ms Coonan’s appearance on Tuesday also came a day after watchdog AUSTRAC announced it was investigating potential non-compliance with anti-money laundering and counter-terrorism financing laws at its Melbourne operation.
On Tuesday, counsel assisting Naomi Sharp SC revealed AUSTRAC emailed Crown on June 8, 2017, informing it SunCity’s Macau-based boss Alvin Chau was a “foreign PEP”, or politically-exposed person, and had a “substantial” criminal history.
It also queried why Crown would continue to associate with SunCity given that links and given its purported support for Australian anti-money laundering rules. At the time, SunCity had a dedicated high-roller room – since closed – inside Crown’s Melbourne casino.
Mr Chau is banned from entering Australia due to his alleged criminal links.
“It would be appreciated if you could provide us with documentation evidencing Crown’s consideration of the appropriateness of continuing to provide designated services to Mr Chau,” the AUSTRAC email stated.
Ms Coonan said she was not made aware of the email but “most definitely” should have been.
Chief legal officer Joshua Preston had been made aware of the email, Ms Sharp said, but his response to AUSTRAC was not disclosed.
Ms Coonan agreed the incident raised concerns about Mr Preston’s discharge of duties as Crown’s anti-money laundering and counter-terrorism financing compliance officer at the time.
“Yes, he’s no longer in that role … about to cease, as I understand it,” she said.
On July 31, 2019, the Crown board – including Ms Coonan, who was not yet chair – issued a statement to the stock exchange arguing it had a “robust process for vetting junket operators” and SunCity’s parent company was regulated and listed on the Hong Kong Stock Exchange. This was not correct.
Crown also placed the statement in the pages of several Australian newspapers as a full-page advertisement.
On Tuesday, Ms Coonan denied SunCity was an “island of immunity” at Crown for money-laundering activity.
On Monday, AUSTRAC revealed its probe into Crown would look at issues relating to due diligence and compliance when managing customers identified as high risk.
Independent federal MP and anti-gaming campaigner Andrew Wilkie welcomed the AUSTRAC inquiry, telling ABC radio on Tuesday there was “much wrongdoing at Crown” that had not been properly scrutinised.
He sought to suspend standing orders in federal parliament’s lower house on Tuesday to move a motion calling for a royal commission into Crown.
But Deputy Leader of the House Darren Chester said the government would not support the suspension of standing orders.
Crown’s board will front a virtual annual meeting of shareholders on Thursday.