Public hearings into the suitability of Australia’s Star Entertainment Group to retain its casino license for The Star Sydney got off to a rocky start on Thursday after a senior manager conceded the company had willingly disguised around AU$900 million (US$665 million) in gambling transactions as hotel expenses.
On the first day of hearings as part of a regular review into Star, Assistant Group Treasurer Paulina Dudek admitted to misleading National Australia Bank when it asked about large transactions made by some Chinese customers using China UnionPay credit cards. The transactions had been flagged by UnionPay as suspicious.
When NAB asked Star about the funds, Dudek said she had told the bank that the chargers were for “hotel accommodation services” and did not mention their use for gambling purposes. She also admitted during Thursday’s hearings that this was misleading.
According to evidence tendered during the opening day of hearings, The Star Sydney processed 156 separate transactions via UnionPay totalling around AU$900 million.
The regular review into The Star Sydney follows Australian media reports aired late last year alleging Star had enabled suspected money laundering, organized crime, fraud and foreign interference by cultivating high-roller gamblers with links to organized crime while ignoring red flags over the source of client funds. Star was quick to deny the allegations at the time, describing them as “misleading”.
While the independent review, being conducted by Adam Bell SC, has largely been undertaken in private, public hearings are being held to specifically focus on a number of topics where Bell has determined that witnesses should give evidence publicly.
“Mr Bell’s review will consider how effectively The Star is complying with its statutory obligations and whether it remains suitable to hold a casino licence,” said Philip Crawford, chair of the NSW Independent Liquor and Gaming Authority last week.
“This includes examining to what extent the casino is free from the infiltration of criminal interests such as money laundering and how well it is administering its obligations to minimize gaming harms.
“The Star is responsible for ensuring adequate anti-money laundering and counter-terrorism financing systems are in place and for thoroughly vetting and managing relationships with close associates, junket partners and high rollers.
“We have every confidence that the review will thoroughly investigate The Star’s current operations, compliance with its statutory obligations, and make appropriate recommendations for remedial action if necessary.
Bell is due to hand down his final report in June.