Star deemed unsuitable to hold casino licence by NSW inquiry

By Noah Taylor Updated
Star Sydney has a new CEO

Star Entertainment has been issued with a scathing appraisal as part of a New South Wales inquiry into the casino operator.

The Australian Financial Review reports that counsel assisting the NSW inquiry has recommended it find the gambling operator unsuitable to hold a NSW casino licence.

Naomi Sharp, SC, said the company was only “at the beginning of its journey” to remediation and most of its executives and managers who have provided evidence did not give credible testimony.

While more than a dozen Star leaders have resigned following the inquiry’s revelations, Ms Sharp said this was not enough to make the company suitable.

“It is not enough to bring a corporation into suitability simply to terminate the employment of or part company with a number of senior officers,” she said, suggesting the evidence of former senior executives such as chief legal officer Paula Martin, chief financial officer Harry Theodore and group treasurer Sarah Scopel was unreliable.

Kicking off three days of closing submissions, Sharp also said Star had not yet undergone “deep reflection” on “what has gone wrong” in Sydney and it should not enjoy the “privilege” of a casino licence until it fixed its practices.

The Star inquiry has heard the casino operator hid criminal gang-linked junket operator Suncity’s illegal cash cage from the regulator and gave it a secret gambling room, misled several banks, breached anti-money laundering measures, may have evaded taxes and facilitated $900 million of banned gambling transactions through its controversial China UnionPay scheme.

Recommendation follows similar pattern to Crown hearings

A finding of unsuitability would mirror decisions made by the NSW Bergin inquiry and Victorian and WA royal commissions into rival casino operator Crown Resorts.

It was deemed unsuitable to hold a licence but permitted to continue gambling in Perth and Melbourne under strict supervision.

Ms Sharp has not yet outlined whether such a plan could allow Star to stay open, but said the casino had not yet undergone “the period of deep reflection necessary to develop a concrete plan” on how it can become credible.

The closing submissions came as the Queensland government called on Star to give evidence at its inquiry into gambling and money laundering reform, which the state is considering in light of the wrongdoing uncovered elsewhere.

Queensland gives Star a please explain

Queensland Attorney-General Shannon Fentiman has pushed back on holding a separate public inquiry into Star’s suitability to hold its Brisbane and Gold Coast casino licences, but the proposed laws would enable her to do so.

Ms Sharp accused all three of Star’s top lawyers who gave evidence of “unethical and dishonest” conduct, singling out group general counsel Andrew Power for engaging in what she described as “deliberate obfuscation” and Ms Martin as allegedly being an “evasive, non-responsive, extremely pedantic” and ultimately “highly unsatisfactory witness.”

“She almost entirely failed to make appropriate concessions or accept responsibility for her conduct,” Sharp said.

Sharp was also scathing of Mr Theodore for in her view being “very reluctant to make concessions in his evidence when they were fairly called for” and said he outlined conduct that was “of very considerable concern”.

Sharp also accused Star of “serious failures” in its risk management frameworks, making “quite misleading” representations to the NSW gambling regulator, having “lack of supervisions of the international VIP team” and “certain shortcomings” regarding high rollers.

These issues will be discussed in coming days, before Star makes its submissions in response later in June.

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