Crown royal commission in Victoria kicks off

By William Brown Updated
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The first day of the Crown Resorts royal commission heard from a compliance officer at Victoria’s gambling regulator who said the casino group lied to him when he tried to investigate how and why 19 staff were arrested in China in 2016.

The Sydney Morning Herald reports that Victorian Commission for Gambling and Liquor Regulation compliance officer Timothy Bryant told the first day of the Victoria inquiry into the James Packer-led group behind Melbourne’s casino licence that he was “frustrated” in his efforts to get to the bottom of the incident.

Chinese police arrested 19 Crown employees in October 2016, of whom 16 were jailed for illegally promoting gambling in the country, prompting an immediate investigation by the VCGLR, which only produced a confidential final report in February 2021.

The royal commission heard the VCGLR ordered Crown to produce internal documents relevant to the arrests and interviewed senior Crown executives, who denied there had been warning signs its staff were at risk in China ahead of the coordinated arrests.

But Mr Bryant said it became clear that was untrue as he obtained more documents from Crown, often only after they had been produced for a shareholder class action stemming from the China arrests, and in evidence in last year’s damning NSW Bergin inquiry into Crown.

“I suppose I was giving Crown, when I was conducting the interviews, the benefit of the doubt at the time to give their position,” Mr Bryant said.

“I didn’t have access to a lot of material at the stage.

“In hindsight, I certainly think that at times they lied to me at interviews with what they were aware of and what they weren’t aware of.”

The VCGLR is responsible for policing Crown Melbourne and has been criticised for either not knowing about or failing to prevent money laundering and other probity issues at the sprawling Southbank casino, which were uncovered in the Bergin inquiry.

The inquiry found Crown unfit to hold the licence for its new Sydney casino.

Instances of Crown misleading the Victorian regulator laid bare

Mr Bryant said examples of Crown misleading him included the casino’s then-chief legal officer, Joshua Preston, claiming that the risk intelligence firm, the Mintz Group, had advised Crown in early 2015 that a Chinese government crackdown on gambling related to casino customers and corruption rather than casinos.

In fact, Mintz expressly warned that China was targeting “people involved in the gambling business.”

Crown VIP executive Jason O’Connor, who was arrested in the 2016 raids and spent a year in a Shanghai jail, said in an interview he had not read a February 2015 news article titled “China’s president just declared war on global gambling” or been aware of any casino crackdown.

But Mr Bryant said the VCGLR subsequently received Crown emails in which Mr O’Connor was sent a copy of the same article.

Likewise, Crown’s then Australian resorts boss, Barry Felstead, told the VCGLR an incident in mid-2015 in which a Crown employee was detained and interviewed by police in Wuhan related to a customer.

But documents Crown finally produced to the regulator in late 2019 showed Chinese police had in fact questioned the Crown employee about organising illegal gambling tours.

Mr Felstead and Mr Preston both left Crown after disastrous appearances at the Bergin inquiry.

Mr O’Connor is still with the group, most recently working on the opening of Crown Sydney.

Mr Bryant said the result of Crown’s delayed, incomplete and piecemeal responses to the VCGLR’s requests for information resulted in a protracted investigation that failed to arrive at a complete picture of what had gone wrong in China.

That final VCGLR report, which has until now not been publicly released, describes Crown’s attitude to the investigation as “belligerent”, the inquiry heard.

The VCGLR could have taken Crown to court for contempt for refusing to produce documents under its compulsory information gathering powers, but Mr Bryant said the regulator decided against that in case it distracted from the investigation.

It might consider doing so now its final report into the matter was completed, he said.

Counsel assisting Adrian Finanzio, SC, told Commissioner Ray Finkelstein, QC, that there had also been delays in Crown producing documents to his royal commission.

As of Friday, 78,095 documents had been produced but “disconcertingly”, Crown delivered about 30,000 documents on Friday night, some of which had been requested as long ago as March.

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