The Queensland Attorney General is edging closer to finalising its show cause notice for The Star Entertainment Group (ASX: SGR) after this week giving the company a detailed list of entities it has deemed unsuitable to hold a casino licence.
Three weeks after Minister for Justice Shannon Fentiman released the Gotterson report that made adverse findings on The Star’s ‘repute, character, integrity and honesty’, the company has released details of the Queensland subsidiaries that are set to be issued with the show cause notice.
The Star has revealed that the individual licensees of the Treasury Brisbane and The Star Gold Coast casinos, as well as The Star Entertainment Brisbane Operations Pty Ltd, the entity that will operate The Star Brisbane when completed, have been formally notified by the Attorney General for censure.
The Star Entertainment DBC Holdings Pty Ltd, which holds The Star’s 50 per cent interest in the Destination Brisbane Consortium, developer of the $3 billion Queens’s Wharf project, is also included in the list.
“The Attorney-General has formally determined that each entity is not suitable to be associated or connected with the management and operations of a hotel-casino complex or casino, by reason of it not being a person of good repute,” The Star said in an announcement to the ASX yesterday.
The company says the formal notification from the Attorney General offers no ‘assessment of what disciplinary or other action may be taken’.
The announcement is a precursor to the Attorney General issuing a formal show cause notice to The Star, which will then be allowed 21 days to plead its case to avoid losing its Queensland casino licence.
A spokesman for the Attorney-General’s office today confirmed that The Star has been sent formal suitability determinations.
“As the Attorney-General has previously stated, it takes time to prepare the relevant materials following determinations of this nature,” the spokesman says.
“The Office of Liquor and Gaming Revenue (OLGR) is finalising the show cause materials, which it expects will be issued shortly.”
The Queensland Government instigated a review of The Star’s casino licence in June this year following bombshell revelations from the Bell review which was instigated by the NSW Independent Liquor and Gaming Authority.
The findings of Queensland’s Gotterson review largely reflected those of the Bell review, which sensationally detailed serious issues with The Star’s now abandoned international junket market that saw Chinese high rollers surreptitiously exchange $900 million for gambling chips at a special VIP lounge at The Star Sydney over seven years.
Among the key findings in the Gotterson report were serious deficiencies with The Star’s anti-money laundering program which, despite expert advice, was found to have persisted over many years. The Star’s responsible gambling program was also cited as needing ‘further and more rapid improvement’, including appropriate resourcing.
The NSW Independent Casino Commission this month hit The Star with a $100 million fine in response to the findings of the Bell review and also appointed expert advisor Nicholas Weeks as manager of The Star’s casino licence in NSW for a period of at least six months.
The Queensland Government now has the authority to issue a similar fine to The Star after increasing the maximum fine it can impose on a casino to $100 million.
When releasing his report earlier this month, Robert Gotterson KC revealed the OLGR is also conducting an independent review of The Star’s partners in the Queen’s Wharf project which will be home to the new The Star Brisbane which is scheduled to open in the second half of next year.
The second review will determine the suitability of Far East Consortium and Chow Tai Fook to partner with The Star on developments such as Queen’s Wharf. The Chinese companies are also working with The Star to develop hotel and apartment projects at The Star’s Gold Coast casino property at Broadbeach.
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