Crown Resorts’ long failure to investigate and admit to claims money was laundered through its bank accounts is worse than the money laundering itself, an inquiry has heard.
“What it says is that this company is unable to govern itself,” counsel assisting the NSW Independent Liquor and Gaming Authority (ILGA)’s inquiry into the gaming company, Scott Aspinall, said on Friday.
“It cannot see the obviousness of money laundering when it is put before it, and it will not concede and co-operate with a regulator to agree to that proposition when it is plain as a pikestaff that money laundering had occurred in those accounts.”
The claim is the latest setback in a disastrous week for Crown, which saw the regulator dash its hopes of opening a new $2.2 billion VIP casino in Sydney next month.
ILGA announced its decision to withhold regulatory approval for the casino for the time being on Wednesday, after Crown presented auditor reports showing money laundering likely occurred in two of its bank accounts.
Crown tendered a witness statement this week from CEO Ken Barton, upending the inquiry’s approach to the money laundering issue.
Crown’s directors all previously gave evidence that they did not look into the bank accounts after the money laundering allegations appeared in the press in August 2019, as did Mr Barton and other executives.
But the evidence produced by Crown this week, including Mr Barton’s statement, reveals the head of anti-money laundering at Crown looked through the accounts within hours of the media report’s publication.
The executive, Louise Lane, recommended that Crown engage external firm Grant Thornton to properly examine the accounts and decide whether there was evidence of money laundering.
According to Mr Barton’s statement, that recommendation was rebuffed after another Crown’s chief legal officer, Joshua Preston, asked law firm Minter Ellison whether Grant Thornton’s report would be covered by legal privilege.
Minter Ellison’s advice was that it would not be privileged and could be produced to the ILGA inquiry, Mr Barton suggests.
Inquiry commissioner Patricia Bergin has demanded Minter Ellison produce any advice it gave Crown on the matter by Friday.
While Mr Aspinall had previously argued Crown turned a blind eye to money laundering, the new evidence suggested something worse, he said on Friday.
“It’s to turn open eyes to a problem and then to turn your eyes away from the problem afraid of what you might find if you carry out the investigation,” he said.
It was “astonishing” that the inquiry had been allowed to proceed on a false premise despite Mr Barton’s knowledge it was incorrect, he added.
“If is merely an oversight, and one would hope beyond hope that it is, that’s one thing,” Ms Bergin said.
“If it is in fact something that was more than an oversight, then that will need to be investigated.”
The latest episode shows Crown is not suitable to run the new casino, Mr Aspinall argued.
Ms Bergin will produce a report by February 2021, which ILGA will then use to consider whether to allow Crown to open the Barangaroo casino, perhaps with conditions like billionaire James Packer diluting his shareholding.
The gaming giant’s lawyers on Thursday argued it should be able to open the casino in December as planned as a “working test” of its operations.
Crown has indicated it will focus on opening non-gaming operations until February.
The inquiry continues on Friday.