Crown director says ex-chairman pressured her to sign money laundering rebuttal

A Crown Resorts director says she felt pressured to sign a full-page advertisement hitting back at media reports of the casino operator’s alleged links to money laundering – and it later emerged executives hadn’t been passing on the full picture to the board.

After Nine aired and published the explosive allegations in July last year that Crown facilitated or turned a “blind eye” to the activities, the casino operator lashed out, labelling the reports a “deceitful” campaign that unfairly sought to damage the company’s reputation.

Crown claimed it had a robust process for vetting operators of junkets, which make arrangements for high-roller gamblers to travel to certain casinos, often by offering inducements such as free accommodation and transport.

A room was set aside at the Southbank casino in Melbourne for Suncity, Macau’s biggest junket operator, and it has emerged financial crimes regulator AUSTRAC warned Crown in 2017 that Suncity chief Alvin Chau was “both a foreign PEP (politically exposed person) and has a substantial criminal history”.

Chau is alleged to be a member of the 14K triad gang and has been banned from entering Australia, reportedly last year.

Crown must report all transactions over $10,000 to AUSTRAC within 10 days, but Naomi Sharp, counsel assisting the NSW Independent Liquor and Gaming Authority inquiry, alleges “massive transactions” in the Suncity room were not reported.

Footage of a man unloading huge wads of cash from a blue cooler bag at a counter inside the Suncity room have been widely broadcast.

The inquiry is determining whether Crown is fit to hold a gaming licence for the $2.4 billion Barangaroo development in Sydney set to open in December, and the chair of that facility’s licensee, Sarah Jane Halton, testified on Thursday that the junket vetting “could have been better”.

Ms Halton replied “yes” when she was asked if she felt pressured to sign the full-page ad, which was also released through the Australian Securities Exchange.

She said she had beforehand spoken with chief legal and regulatory compliance officer Joshua Preston, Australian Resorts chief executive Barry Felstead and Crown’s overall chief Kenneth Barton about the media allegations.

“I was very concerned about these matters … I asked for additional information in relation to our current processes et cetera … I asked for a range of assurances,” she said.

“My understanding was that we were getting good information about what was going on in the business.

“With the benefit of hindsight, recognising it was a crisis, I would have chosen a different mechanism for communication.”

Ms Halton, who is the chair of Crown’s risk management committee and a member of the audit and corporate governance committee, said the pressure mainly came from then-chairman John Alexander, who lost his role in a reshuffle in January.

“There was a strength of view about the response, and I think it would be unfair of me to single anyone out … but certainly the chairman, I can be confident of that,” she said.

“There were a couple of independents who probably were as strong in relation to this issue as others.”

She said she had lost confidence in Mr Preston and Mr Felstead as evidence to the inquiry unfolded.

“I think a number of the assurances and facts as they were presented have proven not to have been reliable,” Ms Halton said.

Their removal was the discussion of a board meeting earlier this year when no decision was made, but that has since changed.

“My understanding is there are discussions about that matter … the question is in relation to the position of those two individuals in the company going forward,” Ms Halton said.

Ms Halton said she believed the reason Crown didn’t look into banks including ANZ and Commonwealth Bank shutting down some of its accounts between 2014 and 2019 over money laundering concerns was “an absence of competence and oversight”.

She said she still had confidence in Mr Barton despite him not telling her about the accounts last year, which was a concern.

“I believe there are a number of issues that need to be discussed in relation to appropriate reporting going forward and judgment about those matters, but, yes, I do have confidence in Mr Barton.”

Ahead of Crown’s annual general meeting next Thursday, Australian Council of Superannuation Investors chief executive Louise Davidson said investors would be looking for director accountability for their oversight of governance failures identified during the inquiry.

These include the “ill-advised public response to concerns over Crown’s practices”, she said, and special treatment given to reclusive billionaire James Packer, a former director but still its biggest shareholder through his private company Consolidated Press Holdings.

“The confidential board-approved process of providing daily financial reporting to CPH is something we have not seen before in an ASX 200 company, and we hope that we never see it again,” Ms Davidson said.

“What we have heard in the inquiry reflects poorly on the board as a whole.

“A number of long-serving directors should be considering their position in light of what has emerged.”