Crown legal officer speaks at NSW government inquiry

A top legal officer at Crown Resorts has spoken at a New South Wales government inquiry into the casino operators’ suitability to hold a casino licence in the state.

The Brisbane Times reports legal officer Joshua Preston told the public inquiry that the casino giant’s anti-money laundering teams did not monitor two company bank accounts suspected to have been used to clean dirty cash.

The inquiry into Crown heard that the ANZ and Commonwealth banks shut down the accounts after Crown patrons used them to make a string of suspicious cash transactions totalling hundreds of thousands of dollars.

Mr Preston recanted evidence he gave on July 31 that the accounts were reviewed by anti-money laundering teams at Crown Melbourne and Perth, which would have reported any suspect activity to the anti-money laundering regulator, AUSTRAC.

“Technically speaking, that’s not correct,” Mr Preston said.

He said that, contrary to his earlier evidence, Crown was not legally obliged under anti-money laundering laws to report transactions to the accounts above a certain threshold. But he maintained it did have to file suspicious matter reports to AUSTRAC.

Counsel assisting the inquiry, Naomi Sharp, SC, disputed this and put it to Mr Preston there was in fact no obligation for Crown to report suspicious matters on the accounts because they were not conducting a “designated service” such as providing a gambling service.

“I’m not sure I can answer that question,” Mr Preston said.

The bank accounts in question were held through two shell companies Crown set up called Southbank Investments and Riverbank Investments.

Customers could use the accounts to deposit money for gambling with “privacy” given the nondescript company names hid the fact the money was going to a casino, but that also made them susceptible to misuse by criminals, the inquiry has heard.

The inquiry is considering whether Crown should keep the licence for its new casino set to open at Sydney’s Barangaroo at the end of the year, and was launched following reports that the ASX-listed group went into business with “junket” tour operators linked to organised crime in Hong Kong and Macau.

Former intelligence head details Macau inner workings

A former head of criminal intelligence for the Royal Hong Kong Police Steve Vickers, who now runs a corporate risk consultancy, told the inquiry on Monday that China’s anti-gambling laws and limits on taking cash out of the country meant it was impossible to keep Triad gangsters out of the junket industry.

“Triad activities in junkets are notorious and well known to everybody, frankly, that knows which way is up in Macau,” he said.

“The capital controls exist in China, it’s still illegal to promote gambling in China, it is difficult to enforce gambling debts in China – that’s the underlying cause as to why Triad societies are around.”

Mr Vickers said junkets would invariably need “people who are tough, who are capable of exercising persuasion, of violence to collect” gambling debt incurred at overseas casinos using the junkets’ credit.

However, Mr Vickers said it was possible for regulation to limit criminal influence in the industry.

The gold standard was Singapore, he said, where the gambling regulator conducts its own “ruthless” due diligence of any junket a casino wants to work with.

“As a consequence, they have successfully eliminated the bulk of the well-known Triad chaps,” Mr Vickers said.

In New South Wales and Victoria, Crown and The Star casinos decide themselves which junkets they work with after conducting their own diligence under a compliance framework approved by the state gambling regulators.

The inquiry will continue on Thursday.