SYDNEY — The casino regulator in New South Wales state has hit Star Entertainment Group Ltd.
SGR,
with a fine of 100 million Australian dollars (US$62 million) and suspended the company’s casino license after an inquiry found it wasn’t suitable to run its casino in Sydney.
The regulator will also appoint a manager to oversee the casino, said Philip Crawford, chief commissioner of the NSW Independent Casino Commission. That means the casino will remain open, Crawford said, noting that an outright cancellation of Star’s license could have led to a shutdown of the casino and caused employees to lose their jobs.
The earlier inquiry found that there were systemic governance, risk and cultural failures at the Sydney casino, and that vast sums of cash evaded anti-money laundering protocols, according to the regulator.
Crawford said the appointment of the manager, Nicholas Weeks, to keep the casino open doesn’t mean the regulator now believes Star is suitable to hold a casino license. But he said there is a possibility for Star to remediate its business to the point where it becomes suitable.
“The appointment of Mr. Weeks will allow casino operations to continue and his primary focus will be to ensure a robust root cause analysis and review of the casino’s culture is undertaken,” Crawford said in a media release.
Crawford noted that Star has publicly apologized and acknowledged the serious wrongdoing that occurred, and that it is willing to cooperate with the regulator.
Australian casinos, including Star’s rival Crown Resorts, have been subject to increased regulatory scrutiny in recent years that have uncovered serious problems, prompting executives and board members to step down. Local authorities have also strengthened oversight of casinos.
Last week, Star said that Robbie Cooke, its new chief executive, will start today.
Star shares were placed in a trading halt earlier Monday ahead of the announcement.
