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Mike Johnson August 4, 2019 4 min read
Crown Australia May Still Be Skirting Regulations
- Crown Australia continues to enjoy political favoritism
- The property has been accused of flaunting gambling regulation
- Crown has been reportedly participating in organized crime
Crown Australia has been enjoying governmental favoritism and skirting pass hefty fines over compliance slippages for years now.
Lax Regulation and Crown’s Murky Reputation
Regulating the iGaming and casino sectors in Australia has been the subject of a lot of criticism, new royal commissions have revealed. Casinos have systematically failed to protect the interest of players and customers, with Australia’s largest casino property, Crown, having been linked to organized crime, money laundering, and fast-tracking visas to “import” VIP gamers into the country.
In one case, the name of Chinese President Xi Jinping’s cousin came up pointing to a regulatory oversight possibly facilitated by politicians. Despite the powers vested into it, the Victorian Commission for Gambling and Liquor Regulation has been reluctant to enforce stricter rules, prompting some to belief that the watchdog was complicit.
Mr Jinping’s relative is not the only on and in hot water is also James Packer, Australia’s richest man. He emerges as a suspect in the alleged illegal activities Crown has had its hands in for a while now.
More interestingly, the Commission has been keeping taxes on gambling to a minimum. Based on one observation, Crown Perth relieved patrons of AS$622.8 million in 2016/2017, but the government only claimed AS61.9 million back in tax. The issue is that the Victorian government has very few sources of funding and with several sectors that demand proper funding, the state appears week and unable to provide for itself.
Why Going Easy on Crown?
Crown Australia enjoys multiple perks that other companies do not. While pubs and clubs are obliged to pay 37% on their GGR, Crown skirts this by using tax breaks. Not only that, but the brand has established monopoly in both Victoria and WA.
Plus, the tax breaks that Crown gets continue to pile on. Crown-owned properties are allowed to run 24/7 and they have unlimited betting amounts on the slot machines, known as pokies. Plus, any expansion is usually weaved through without any of the usual red tape necessary.
Case in point is the new development project at Barangaroo on Sydney Harbor where Crown will construct a new skyscraper with casino along with a number of luxury apartments and a hotel. Now, the question is – what if Australia decides to impose a stricter tax on Crown?
Responsible Gambling at Crown: VCGLR’s Report
At the same time, Crown has been reportedly handing out plastic picks to gamers, so they may jam the slots and simulate an auto-play function. Yet, the VCGLR’s only response was to ban the picks but imposed no fines for this glaring violation of responsible gambling practices. During a 2018 review of Crown’s operations, VCGLR established a number of irregularities, including:
- Failures of governance and risk management, contributing to compliance slippages
- A lack of innovation and progress regarding Crown’s approach to responsible gambling
- A failure to meet regulatory expectations
One way that Crown and other properties have been avoiding stern actions against themselves is through the recruitment of influential political figures to enable lobbyists that protects the properties and brands from too harsh regulatory involvement.
Politicians and Organized Crime
Meanwhile, string of former politicians now take cushy jobs as part of Crown’s management, including former head of health and finance Jane Halton, former Liberal Minister Helen Coonan, former Australian Chief Medical Officer John Horvath and former AFL CEO Andrew Demetriou.
Worse, Crown was implicated into an organized crime ring, facilitating high roller players entry into the country, a move that excited less interest and regulatory scrutiny than it should have.