Victoria Expands Royal Commission Crown Resorts Probe
The inquiry by the Victorian government into Crown Resorts took another unexpected turn this week. According to Reuters and other reports, the Victorian government is extending the timeline of its investigation into Crown. This is being done so that it can expand its investigation into a wider array of issues.
Furthermore, funding for the Royal Commission is being increased so they can further investigate Crown. This does not bode well for the casino giant in its attempt to have its Victorian casino license reinstated.
Victorian Government Expands Crown Probe
On Thursday, news broke from multiple sources that the Victorian government is expanding its probe into Crown Resorts. The probe was to initially conclude on August 1st. However, revelations made during the current investigation are prompting officials to expand the investigation. Now, the probe will continue until October 15th.
Furthermore, the funding for this probe will expand. Instead of a max of A$10 million, the Royal Commission can spend up to A$19.75 million (US $15.22 million). The Royal Commission was commissioned by the state back in February to investigate the suitability of Crown Resorts for a casino license.
— Business News Aus (@BusinessNewsAus) June 11, 2021
The expansion is being done to further investigate things that have come up during testimony and fact-finding to this point. According to reports, the Royal Commission will take a deeper look into Crown Melbourne’s corporate culture. This will also further investigate various claims made by witnesses to this point. Among those claims are that Crown has actively cooked their books to avoid paying taxes on live pokies earnings.
Crown Resorts has said that it will cooperate with the Royal Commission. However, based on recent reports, it will be interesting to see whether they adhere to those claims or if they will continue to try and avoid inquiries, such as those for the spreadsheet containing tax underpayments.
What This Could Mean For Crown
Honestly, this is not a good sign for Crown Resorts whatsoever. This announcement shows that the Victorian government believes there is even more damming evidence against Crown Casinos and they are taking the time to uncover it all.
The extension of time is not the most telling part of this. A two-month extension could is explainable for various reasons. However, the government is doubling the budget for the Royal Commission. This means that there is reason to believe that there is a lot more to uncover about Crown than was originally believed.
Good news. There is hope that this Royal Commission will lead to real change in the management and regulation of gambling in Victoria.
Crown royal commission extended by 10 weeks after fresh licence concerns emerge https://t.co/eOP3VeMYMj
— Wetherby2019 (@wetherby2019) June 11, 2021
When we reported on the tax evasion by Crown, we called that a damming admission. One has to wonder whether that will prove to be the catalyst in this expansion. Tax evasion is never a good thing and now that it appears that this is part of corporate culture, the government is likely wondering what else is part of Crown’s corporate culture.
The best thing for Crown to do at this point is to come forward with any and all evidence they can find of potential wrongdoing. From reports, they are still actively dodging inquiries and requests for information. The Royal Commission is coming for them even harder now, so they should prepare accordingly.
Royal Commission Expansion the Beginning of the End for Crown?
We’ve already commented that the Crown will have to complete its sale to save its license, but now one has to wonder if that will be enough. With a proven link to gambling junkets and money launderers, Crown was already in shaky territory. However now that the company has admitted to tax evasion and a corporate culture contrary to regulatory rules, one has to wonder if Crown is about to lose its case entirely.
The best chance for Crown to keep the license now would be to announce a sale plan before the end of the Royal Commission inquiry. Furthermore, it will have to be a complete disconnect from the current Crown leadership. Otherwise, they may not be able to recover from this.
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