NSW casino crackdown ups the ante with $100m fines and boards in the firing line

Hard on the heels of a crackdown in Victoria, authorities in NSW have upped the ante with new measures to keep casino operators in check that could lead to record fines of up to $100 million.

And for the first time, senior executives and board members will be personally liable for any wrongdoing they either facilitate or know about but fail to stop.

The new NSW Independent Casino Commission, formed in June in response to the Bergin Inquiry, will also be given new powers of investigation and enforcement to specifically target money laundering and criminal activity within casinos.

The measures, which will be introduced to the NSW Parliament next week, address all 19 recommendations of the Bergin Inquiry which found that Crown Resorts was unfit to operate Sydney's newest casino at Barangaroo.

The Inquiry uncovered evidence that Crown had facilitated money laundering through its casinos and that its high-roller junket program was a conduit for organised crime activities.

NSW Minister for Hospitality and Racing, Kevin Anderson, says further measures will be introduced to shore up the compliance requirements of casino operators in the state, including some key recommendations from the Victorian Royal Commission that investigated Crown Resorts.

“The new regulator will be truly independent and will be directly funded by the Casino Supervisory Levy paid by both casinos, with independent decision-making on licensing and disciplinary matters,” Anderson says.

“With all penalties under the Casino Control Act to be increased at least tenfold and a new maximum fine of $100 million for disciplinary action, the NICC will have scope to deal appropriately with serious misconduct of the type uncovered by various recent inquiries.”

The Star Entertainment Group (ASX: SGR), which is waiting on the release of a report from the Independent Liquor & Gaming Authority following a brutal review of its casino licence earlier this year, says it has yet to examine the full details of the powers proposed for the NICC.

“The Star has previously indicated its support for the recommendations of the Bergin Inquiry,” says the company in a statement to the ASX.

“The Star will review the details of the proposed reforms and the potential implications for its operations once available.”

The beefed-up regulations come in the wake of new measures to be introduced by Victorian authorities to diminish the risks of money laundering at Crown Melbourne. These include a cash transaction limit of $1,000 a day on all punters to thwart potentially illegal activities.

The NSW authorities are taking a similar stance with cash transactions of more than $1,000 per patron per day to be phased out as cashless gaming is introduced at both Crown Sydney and The Star Sydney.

For the first time, the NSW crackdown personally targets senior executives and the boards of casino operators who facilitate or know about serious wrongdoings but fail to stop them. The NICC will be able to take disciplinary action against individuals, not just casino operators as its powers currently allow.

Among the other reforms to be introduced in NSW are:

• Regular reviews of casino licences through public inquiries with powers similar to a royal commission
• Full disclosure from casinos on any requested information, including notifying the NICC of any breach or likely breach of the law
• The appointment of independent compliance auditors who will report to the NICC on casino operators’ compliance
• A transition to mandatory carded play, requiring gamblers to use cards that identify them and track their play
• New requirements for those seeking to become close associates of a casino to demonstrate they are suitable
• A requirement by casinos to give regulators continuous access to gaming data, as pubs and clubs have done for years.

NSW also plans to establish a ‘multi-agency coordination committee’ comprising NSW police and the NSW Crime Commission to guide the NICC’s regulatory duties and potentially collaborate on enforcement activities.

NICC is currently overseeing Crown Sydney’s compliance improvements as the company prepares to finally welcome punters to its Barangaroo casino on 8 August after the company was granted conditional approvals.

“Crown has implemented a considerable reform agenda with wholesale staff and system changes under the oversight of ILGA and its independent monitor,” Anderson says.

“The conditional gaming period will enable the NICC to closely monitor Crown’s operations and ensure that the reform agenda is completed to the regulator’s satisfaction.”