Posted on: October 17, 2024, 02:03h.
Last updated on: October 17, 2024, 02:04h.
Star Entertainment has been fined again by the New South Wales Independent Casino Commission but is allowed to continue running its Sydney resort.
Australia’s second-largest casino operator, Star has agreed to pay a A$15 million (US$10 million) penalty after the NSW Independent Casino Commission (NICC) determined that the company remains non-compliant regarding regulatory obedience. However, Star is permitted to continue operating slot machines, or pokies as they’re called Down Under, and live dealer table games at The Star Sydney.
In 2022, an NSW inquiry concluded that Star Entertainment was unsuitable to possess a gaming license in the state. The probe found widespread evidence that The Star Sydney did little to combat money laundering at its casino and keep criminal syndicates off the property.
After the 2022 inquiry, Star was allowed to continue operating the Sydney casino but under a government-appointed manager. Star was ordered to undergo many remedial measures to bring the casino into regulatory compliance and was fined A$100 million.
Two years later, a follow-up review from the NICC found that more work is needed to gain suitability and regain full control of the company’s gaming permit.
Star Remains Noncompliant
In announcing the A$15 million penalty, NICC Chief Commissioner Philip Crawford said the second inquiry identified continuing compliance failures and that operations at The Star Sydney remained “far short of suitability.”
Crawford said the NICC-appointed manager, Nick Weeks, will continue to oversee The Star Sydney until at least March 2025 when another review of the casino’s business is conducted. Crawford detailed that The Star continues to have numerous shortcomings in its governance, regulatory compliance, technology operations, and risk management.
In a casino setting, compliance breaches can have serious consequences for the community, and the Bell Report illustrated how quickly weak controls can lead to criminal infiltration and gambling harm,” Crawford said. “The NICC understands the many challenges The Star is facing and will continue to closely monitor The Star’s progress in proving it is capable of regaining its casino license.”
Along with the fine, the NICC ordered additional financial and operational reporting requirements between now and March 2025.
Crawford added that The Star CEO Steve McCann, the former CEO of Star rival Crown Resorts who was appointed to the job in June, has maintained an open line of communication with the casino regulator. Crawford said the NICC has experienced “a much healthier relationship” with Star governance since McCann’s appointment.
Star Bleeding Money
Star Entertainment remains a prime takeover target, as the casino company that runs The Star Sydney, The Star Brisbane, and The Star Gold Coast continues to operate at a significant loss.
Last month, The Star posted a second straight multibillion-dollar annual loss. Shares of the company traded on the Australian Securities Exchange closed on Thursday at just A$0.29.
Hard Rock International recently denied its interest in buying The Star Entertainment after the Australian Financial Review reported on rumors that the company controlled by the Seminole Tribe of Florida was mulling an acquisition play.
US-based private equity giant Blackstone, which already owns Crown, is also said to be considering an offer for Star. Blackstone additionally owns the Bellagio, The Cosmopolitan, Aria, and Vdara on the Las Vegas Strip.
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