Crown Melbourne fined $1m over junket conduct

Crown Melbourne fined $1m over junket conduct

Crown Resorts' (ASX: CWN) Melbourne casino has been dealt the maximum $1 million fine for junket conduct, after Victoria's gambling and liquor regulator concluded the company failed to comply with its regulatory obligations.

The fine is equivalent to around 0.04 per cent of Crown Melbourne's annual revenue pre-COVID.

Royal Commissions into Crown's casinos are ongoing in Victoria and Western Australia, with junkets forming part of investigations in the wake of the Bergin Inquiry report in NSW that deemed the group "unsuitable" to hold a casino licence in the state and prompted a board exodus.

The Victorian Commission for Gambling and Liquor Regulation (VCGLR) found processes implemented by Crown regarding junket standards were not robust enough, and that the group had failed to gather the necessary information to make informed decisions about junket operators.

The VCGLR also found Crown failed to maintain appropriate and up-to-date records about junket probity decisions, making it unclear how decisions were reached and whether they were made with due regard to Crown's regulatory obligations. 

The commission has now issued a letter of censure to Crown prohibiting it from recommencing junket operations at the Melbourne casino until it is satisfied procedures have improved, while Crown will also need to report regularly on the progress of a reform agenda presented in its submissions to the commission.

VCGLR chairman Ross Kennedy says whilst this is not the first time the commission has taken disciplinary action against Crown, it is the first time Crown has been fined the maximum fine available to the VCGLR under the Casino Control Act 1991.

"That fine reflects the seriousness of this matter, and the fact that Crown's failure to implement a robust process occurred over an extended period," Kennedy says.

"Robust processes must be implemented to ensure that Crown's Melbourne casino remains free from criminal influence and exploitation. These are strict and legislated regulatory requirements, and this is an area where Crown has repeatedly failed."

The regulator recognises that this matter may be relevant to the Royal Commission into the casino operator and licence, and will continue to assist that Royal Commission with its inquiries.

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