Last week ended with Star Entertainment Group seeing off three more executives in the faces of CFO Harry Theodore, chief casino officer for New South Wales, Greg Hawkins, and chief legal officer and company secretary Paula Martin. The news of their departure was confirmed on Friday.
The departure of more executives is not all Star is doing to mitigate the impact of an ongoing review into its alleged breaking of regulatory standards with the company now suspending all rebate programs. The Star Entertainment Group is cutting its domestic and international rebate play programs in an attempt to address possible breaches of anti-money laundering and counter-terrorism laws at its casinos.
Rebate Programs Suspended at Star Entertainment
Rebate programs are a mechanism that casinos use to give awards to players of certain games. Those awards can then be converted into money by way of playing the same games. It’s a classic way to attract more VIP players.
Amid the questionable motivation behind such programs runs a decision to switch local players to the international rebate program in what some construe as an alleged attempt to save up on tax. To top it off, the Star Sydney Casino is under regulatory review after a public hearing revealed possible compliance lapses, so this might not have been the best time for a rebate program at the casino to come out as possibly fraudulent or illegal.
As an answer, Star said it “resolved to immediately suspend rebate programs for both domestic and international players across all its casinos until further notice” and that it “will work with gaming regulators to address various identified risks as part of ongoing reviews of systems and processes.”
The mentioned reviews include an examination by Adam Bell SC, who was the lead senior counsel assisting the Bergin Inquiry, requested by the NSW Independent Liquor & Gaming Authority (ILGA), and who now spearheads the review into the Star Sydney. The goal is to assess if and how effectively The Star is complying with the statutory obligations. This is important as the casino’s license might be at stake if the review finds out more dubious practices and deems the Star Sydney unsuitable to hold a license.
Cleaning Up Star Entertainment’s Act
Bell’s involvement is a clear signal that regulators will not leave this one alone. ILGA chair Philip Crawford commented on the appointment of Bell as the lead person for the process at the time:
“Bell was the lead senior counsel assisting the Bergin Inquiry into Crown Resorts’ Barangaroo casino and, as such, has extensive knowledge of casino regulatory matters in NSW including the issues of concern identified in the Bergin Report.”ILGA chair Philip Crawford
In the wake of ongoing reviews and rebate programs being suspended, Star is currently working hard to find replacements for the company’s latest management losses. In the meantime, current group executive gaming, Christina Katsibouba, has been appointed Interim CFO, and current group executive operations, Geoff Hogg, has been appointed Interim chief casino officer of New South Wales and Queensland.
To calm the waters further, The Star Entertainment Group assured that the decision to cut rebate programs would not have a bearing on the earnings for FY22.