A top lawyer at Star Entertainment has rejected claims he conspired to “water down” an internal report about the casino’s dealing with a notorious Macau-based junket operator allegedly linked to Asian crime gangs.

The NSW Independent Liquor & Gaming Authority inquiry into The Star Sydney is examining whether the Sydney casino has been infiltrated by criminal activity, and if its casino licence should be withdrawn following damning media reports.

Star group general counsel Andrew Power was quizzed on Monday about why the gaming operator continued dealing with junket operator Suncity after it became aware, via an internal report, of the group’s alleged links to organised crime.

The inquiry was told Mr Power was presented in October 2020 with a report from Star’s due diligence officer containing “four important strands of information” related to Suncity, including alleged “triad antecedents” of its backer Alvin Chau.

The report also referred to The Star missing, until 2020, that Mr Chau was a “politically exposed person” from 2013 due to his membership of the Quandong Provincial Committee of the Chinese People’s Political Consultative Conference, China’s political advisory body.

“Isn’t it right that the only appropriate decision given at this point in time you were the AML (anti-money laundering) CTF (counter terrorism financing) compliance officer was to exclude Alvin Chau from dealing with The Star?” counsel assisting Naomi Sharp asked.

“I don’t agree,” Mr Power replied.

The barrister then put to him: “Today the regulator can have absolutely no confidence in your judgments as to who is and who is not a suitable person for The Star to have business dealings with or to have as a patron.”

“I don’t think that’s fair,” the witness replied.

The inquiry was told Mr Power later provided a “marked up” version of the report to the casino’s due diligence officer that removed criticisms of the way The Star dealt with Suncity and Mr Chau in order to “sanitise” the document.

It was told that in the revised version there was no reference of “significant” money laundering concerns held by The Star in mid-2019 about Suncity and Salon 95.

Mr Sharp submitted that the later version “significantly watered down” the concerns expressed to Mr Power in the draft “about the propriety of Mr Chau”.

“I don’t believe it was watered down,” he said.

Asked whether he conspired with casino managers to amend and sanitise the later version of the report, Mr Power said: “That’s not correct.”

No decision was made on whether to cease dealing with Suncity and Mr Chau until November 2021, the inquiry was told.

It has previously heard claims Star enabled money laundering at its international operations, broke rules on the use of Chinese debit cards, and allowed patrons to walk out of the casino with large numbers of gaming chips.

The inquiry continues.