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Australian casino operator The Star Entertainment Group has suffered a new double blow with the resignations of its CEO and CFO and the New South Wales (NSW) state gambling regulator’s decision to make public a critical review into the company.
Star Entertainment announced late on Friday (March 22) that group CEO and managing director Robbie Cooke had fallen on his sword after the NSW Independent Casino Commission (NICC) lost confidence in his suitability.
“Whilst I find the [regulator’s] position exceptionally disappointing, I have reached the conclusion that my continuation in the Group CEO role is not going to be conducive to the NICC determining to find The Star capable of becoming suitable to hold a casino licence in NSW,” Cooke said in a company filing to the Australian Securities Exchange (ASX).
“In these circumstances a change in leadership provides the best opportunity for the business to navigate the regulatory pressure it is facing,” he said.
Star Entertainment is only months away from learning if it will continue operations in Sydney or lose its casino licence, with a new inquiry into Star’s reform period likely to guide the regulator in its final decision.
The inquiry is headed by barrister Adam Bell, who presided over the earlier, devastating probe into the company’s practices, directors and staff. Bell previously served as counsel assisting for the equally damaging Crown Resorts probe in NSW.
Cooke told Star staff in a note cited by the Sydney Morning Herald that NICC chief commissioner Philip Crawford “had issues” with Cooke’s retention of some executives, despite them not being on the “executive committee at the time the offending conduct identified in the original Bell inquiry occurred”.
“Secondly, it also seems that the Chief Commissioner did not consider I was moving with sufficient speed with the reforms and changes being implemented at The Star — a view with which I respectfully and fundamentally disagree,” Cooke added.
Star Entertainment chairman and non-executive director David Foster has replaced Cooke ahead of a replacement CEO, while Cooke will remain a consultant for six months to aid the transition, the filing said.
Another casualty of Star Entertainment management is CFO Christina Katsibouba, who “decided the time is right to move on”, Foster said in a second ASX filing on Friday. Her interim replacement from Monday (March 25) is former Tatts Group CFO Neale O’Connell.
Other departures in a fortnight of staff bloodletting are chief of staff Peter Jenkins, who also resigned on Friday, and chief customer and product officer George Hughes, who quit two weeks ago.
Still reeling from its latest C-suite fallout, Star has been informed that the NICC has reversed its decision to hold the second Bell inquiry behind closed doors.
That decision will dismay witnesses called by the inquiry, given the relentless and adversarial lines of questioning in the previous inquiry and resulting public damage to reputations of former Star directors and executives.
“The Star has today been advised by NICC that Mr Bell … has formed the view it is in the public interest for the inquiry hearings to be held primarily in public,” Star said in a Monday ASX filing.
The inquiry will also likely be extended by two months, requiring the regulator to further extend the term of The Star casino’s external special manager, Nicholas Weeks, to September 30, it said.
In a separate article on Monday, the Sydney Morning Herald alleged that NICC boss Crawford had “engineered” the latest spill of Star brass, and that it has been “fascinating to watch the once sleepy NSW casino regulator transform into a compliance head kicker”.
The newly aggressive NICC thus appears to be closing the distance with its Victoria state counterpart, which has led the nation in terms of aggressive reform across all gambling segments.
Meanwhile, Queensland state, where Star Entertainment operates two casinos and is set to open The Star Brisbane at the Queen’s Wharf precinct in August, last week passed tough new casino control legislation to complete its response to the state’s own probe into Star’s non-compliance.
In an unrelated incident two weeks ago, Tabcorp CEO Adam Rytenskild was forced to resign by his board for making a sexual reference to a female regulator in Victoria.
Australia’s regulatory environment continues to tighten for gambling interests on the back of these latest developments, with severe financial punishments still expected for Star Entertainment and certain corporate bookmakers in separate probes by federal transactions regulator AUSTRAC.
