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Australian casino operator Crown Resorts has been fined A$1m ($722,000) for “deliberate disobedience or wilful blindness” toward the Victoria state gaming regulator over improper junket activity in 2015 and 2016.
The Victorian Commission for Gambling and Liquor Regulation (VCGLR) on Thursday said it had fined Crown’s Melbourne subsidiary the maximum amount for the second time, on this occasion for “failing to comply with regulatory requirements in relation to particular historical junket operations”.
The VCGLR said Crown Melbourne failed to cease its relationship with an “unsuitable junket operator” despite being directed to do so in writing, failed to perform due diligence on an associate of the operator who herself ran a junket at the property and failed to inform the regulator of her operations before they commenced.
Crown’s breach of the law was so serious that the VCGLR considered suspending its casino licence, according to a judgment summary dated December 22, 2021.
But mitigating factors such as cooperation with the VCGLR probe, contrition and improved internal controls led the regulator to settle for the maximum fine.
The probe found that Crown had disregarded a November 2015 order to cease dealings with “Mr A”, a long-time Crown customer and junket operator, following his conviction for gambling offences in the United States in December 2014.
The VCGLR also declined Crown’s request to deal with Mr A only as a VIP player.
However, despite confirming it had ceased business with Mr A in late November, Crown started hosting junket operations the month before by “Ms B”, a “personal assistant” to Mr A whose operations were “at least in part, guaranteed by Mr A”.
Ms B’s junket operation also received a credit facility of A$20m guaranteed by “Mr C”, a “business associate” of Mr A who had also been arrested in the United States “at the same time as Mr A”.
“Taken together, the combination of these matters exhibits all the hallmarks of either deliberate disobedience or wilful blindness,” the judgement said.
“It is also conduct that has had the effect of directly frustrating the commission in its objective of ensuring that the Melbourne Casino remains free of criminal influence or exploitation.”
The VCGLR report declined to name the junket parties and associates.
However, their arrest record details and matching information from an ABC Four Corners television report in July this year likely identify Mr A and Mr C as professional poker player Seng Chen “Richard” Yong and his long-time online gambling associate, professional poker player Paul Phua. Both men are Malaysian.
Yong and Chua were arrested in July 2014 after an FBI raid on illegal bookmaking in Caesars Palace in Las Vegas. Yong pled guilty to a misdemeanour charge, while Chua was charged but released by the court over inadmissible evidence.
Following a withering state Royal Commission report into Crown Melbourne, Victoria has passed legislation that effectively shackles Crown Resorts with a state-appointed, veto-bearing board overseer for a two-year probationary period.
Other tough measures include the raising of the maximum fine from A$1m to A$100m, tight banking restrictions and the abolition of hefty compensation for Crown in the event of regulatory changes.
