Crown Melbourne to Undergo Royal Commission Inquiry
We recently reported that Crown Resorts was found unsuitable to hold a license in NSW. Some believe it is clear that the company will lose its Melbourne license. Now, a new Royal Commission inquiry is underway. The inquiry will determine if the Crown Melbourne casino will be able to keep its license.
Crown Melbourne Faces Royal Commission Inquiry
A recent report stated that Crown Resorts is not suitable for an NSW license. Now, the Victoria Government will launch a Royal Commission inquiry. The new inquiry will determine whether Crown Resorts deserves to continue holding a Victoria gambling license.
Former Federal Court Judge Raymond Finkelstein QC will head the inquiry. Details became clear during a Monday press conference on the inquiry. Melissa Horne, Victoria’s Minister for Liquor and Gaming Regulation believes that the inquiry is the best course of action to take in light of recent findings.
Victoria announces Royal Commission into Crown Melbourne https://t.co/6kh2FMd7qe
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According to Horne, “Following the Bergin Inquiry, there were a number of significant issues that came out. “We’ve gone through [the Bergin Report] line by line and have understood our commercial contracts (with Crown) and have taken legal advice as to what the most appropriate response is to those severe findings. The most appropriate response and one that will protect the Victorian interest the best is a Royal Commission.”
Horne also told reporters that the Royal Commission will expedite its findings and could make them public as soon as August. They have until the end of the year to complete the inquiry.
Crown Plans to Comply With the Royal Commission
Crown Executive Chairwoman Helen Coonan sent out a statement following the announcement of the Royal Commission. She says that “Crown welcomes the announcement from the Victorian Government as it provides an opportunity to detail the reforms and changes to our business to deliver the highest standards of governance and compliance, and an organizational culture that meets community expectations.
Victorians should be assured we recognize the responsibility placed on us by the community, governments, and regulators and we will fully cooperate with the Royal Commission.”
Crown has a lot of ground to cover with the commission. The Bergin Report unearthed a myriad of failures at the company. Much of it stemming from the lack of adherence to anti-money laundering procedures. The casino’s connection to organized crime has been a major black mark. Thus far, the company has been unable to open its new NSW casino and will not be able to do so until the matter is resolved.
Packer Departure Could Result in License Retention
A recent report in the Herald Sun seems to indicate that a resolution is already likely for the matter. However, it would require that majority shareholder James Packer leave the company entirely. Packer is still the company’s biggest shareholder, holding about 37% of the company’s shares.
The Bergin report recommended that any shareholders with more than a 10% share need to be suitable to hold a license. As such, that insinuates that Packer would have to reduce his share to less than 10%.
It is unknown whether he will have to hold less than 10% or if he will have to disassociate himself entirely.
According to reports, Packer had several representatives on Crown’s Board of Directors. He was also receiving secret briefings about the financial status of the casino. Many feel that the only path forward is without Packer. That now seems to be the case in both Victoria and NSW.
Considering the amount of money that Crown Melbourne has invested in Victoria and the amount of money the casino brings to the region, it is likely that everything will be done to avoid voiding its license. The question is whether Packer will comply.
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