VCGL Issues $720,000 Fine to Crown for Working with Junket Operators

Crown Resorts Melbourne is again in the center of a new regulatory action against the company. After facing a possible license suspension in July, the Victorian Commission for Gambling and Liquor Regulation stated on Thursday that it issued a $720,000 (AU$1 million) fine after the operator failed to comply with junket rules.

This is the Maximum Fine That Crown Can Receive

As the VCGL stated, Crown Melbourne did not cut ties with Mr A and its associate Ms B, who were flagged as junket operators, even though it received warnings on multiple occasions. Instead, it continued to work with these operators and hence, the VCGL had no choice but to issue a fine.

Currently, the $720,000 penalty is the regulator’s maximum fine, however, that may change as legislation raised the limit to $72 million (AU$100 million). The chair of the VCGL, Ross Kennedy, stated that the maximum penalty mirrors the seriousness of the transgression. Particularly, the penalty focuses on what the regulator explained was Crown property’s ability to implement the commission’s guidance and cease all activities related to junket operators.

Kennedy also added that the commission expects all of its “regulated entities to be proactive” when it comes to complying with the requirements of the regulator. Those that willingly disobey or disregard these requirements, which is what Crown Melbourne arguably did, will face a penalty at the commission’s discretion.

Crown Melbourne Did Not Report Its Relationship With The Junket Operators

Crown Melbourne started working with Ms B in October 2015. The collaboration continued in 2016 and a $14.4 million (AU$20 million) credit facility, which was guaranteed by Mr C, a business associate of Mr A, was granted to her. At the time, Mr A was arrested in the US.

To make matters even worse, Crown was also fined by the VCGL in April for similar breaches. That prompted the state of Victoria to tighten regulations on the casino industry by increasing the fine and using a key casino and gambling act amendment to ban junket operators.

The Australian gaming company ceased all working activities with junket operators in November 2020 and stated that it will use the commission’s recent findings to learn from its mistakes and continue the process of reforming.

Recently, Crown Melbourne also faced a shortage of working staff which is why it decided to invest money and put effort into refilling the human resources in the state’s hospitality industry. As the operator announced, the plan to overcome these difficulties was by training as many as 1,000 new hospitality workers with the help of the Australian Hotels Association (Victoria) and the Victorian Chamber of Commerce and Industry.