The Star Sydney may have violated the New South Wales Unlawful Gambling Act by running an illegal “casino within a casino.” That’s according to lawyers charged with scrutinizing Star Entertainment’s suitability to hold a gambling license in the Australian state.
Naomi Sharp SC, above, reminded the inquiry during closing arguments that Star Entertainment was not “running a flower shop” and should have been more alert to criminal infiltration. (Image: The Australian)
On the final day of public hearings Monday, lawyers assisting the regulatory inquiry into Star’s business practices argued the company was not fit for licensing.
The inquiry has heard evidence that Star allowed Macau-based junket operator Suncity to secretly operate an unbranded VIP room, known as “Salon 95.” At the time, the junket had been identified by Australian authorities as having links to organized crime.
Lying to Regulators
Salon 95 continued to offer high-stakes baccarat games to high rollers after then-Star CEO Matt Bekier told regulators his company had severed business links to Suncity.
Bekier announced his resignation late March.
In closing arguments, Naomi Sharp SC suggested those games fell afoul of state gambling laws because “The promotion of the game was not by the casino operator in those circumstances.”
When Suncity staff were accepting or handling or providing chips to patrons at the service desk in Salon 95, they were assisting in the conduct of an organization of the game, and The Star in providing the premises was assisting,” Sharp said.
“There are some pathways by which it can be said that The Star … contravened statutory provisions in permitting a pseudo-cage to be operated, not by it, in Salon 95,” she added.
Sharp was responding to the suggestion by Star’s lawyers that it is now suitable for licensing following a major reshuffle of corporate management.
But Sharp also took issue with Star’s assertion that its scheme to allow high-rollers to swerve China’s controls on the movement of money did not “significantly elevate risk from a money laundering and counter-terrorism financing perspective.”
$900M CUP Scheme
Star Sydney allowed Chinese high rollers to use China UnionPay (CUP) credit cards to withdraw a total of $900 million for gambling. These transactions were disguised as “hotel expenses.”
Star’s assertion was “difficult to reconcile” with its admission that no source-of-funds checks were conducted, Sharp said.
“The reality remains that this company was not running a flower shop, it was running casinos. And in casinos, there are well-known risks of criminal infiltration and of money laundering,” she added.
The inquiry was launched following allegations in Australian media that Star had facilitated suspected money laundering by organized criminal elements. These reports also suggested the company wooed foreign agents and fraudsters to gamble in its casinos from at least 2014 to 2021.
Adam Bell SC, chairing the inquiry, is expected to complete his report by August 31.
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