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The Star Entertainment Group will not be suitable to hold a casino licence until it has decisively rectified its dysfunctional internal culture and risk management failures, according to lawyers assisting a government an inquiry into the company.
On the final day of NSW hearings into casino giant, counsel assisting the inquiry Naomi Sharp, SC, accused the casino operator of belated, and limited admission of wrongdoing. But she said the more significant issue is the lack of insight provided into why and how it all went wrong.
“To date, very little has been said about why these problems have happened, and why the misconduct occurred. Very little has been said about why the culture was dysfunctional to the extent that it was and why the second line of defence under the risk management framework failed so fundamentally,” she told the inquiry.
Counsel assisting the inquiry Naomi Sharp, SC.
“We submit, there is still the need for a further period of reflection and investigation to understand how this could have gone so wrong.”
The NSW Independent Liquor & Gaming Authority (ILGA) launched the review into The Star, led by Adam Bell, SC, last year following revelations by The Sydney Morning Herald, The Age and 60 Minutes of alleged money laundering, links to organised crime and fraud at the Pyrmont casino.
Sharp was responding to submissions by The Star and its board which claim that a significant overhaul of senior staff - including the departure of its chief executive Matt Bekier and chairman John O’Neill - means it is suitable again.
Sharp reiterated her criticism of the Star’s directors for being too passive, saying a report the board saw indicating Star may have misled NAB about the use of China Union Pay (CUP) cards at its casinos should have raised suspicions.
“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,” Sharp said.
She also cited the failure by Star executives to disclose Project Congo - an internal assessment, conducted in August last year, of whether its junket operators were of “good repute” - as a sign of ongoing issues at the casino operator.