Casino giant Crown Resorts is not fit to run its $2.2 billion Sydney casino because it facilitated money laundering and has other "deep" problems, a highly anticipated report has found.
Commissioner Patricia Bergin has recommended a number of dramatic changes that Crown would have to make before it could run the casino.
Two Crown subsidiaries were used to launder money, and Crown facilitated that money laundering for at least five years, Ms Bergin finds in a report to the NSW gaming authority. The report was tabled in NSW parliament on Tuesday afternoon.
Even after media reporting about the money laundering appeared in 2019, Crown showed a "total lack of commitment to turning inwards and rectifying the obvious problems", Ms Bergin says.
The company's denial and inaction show "present and very deep corporate cultural problems" that mean it is not suitable to hold the valuable licence to run its Barangaroo casino.
Ms Bergin also found that Crown partnered with junket operators who have links to organised crime groups even after being made aware of these connections, and that the company exposed its staff to the risk of detention in China.
The NSW Independent Liquor and Gaming Authority (ILGA) will now decide whether to cancel the licence completely, suspend it, or impose conditions on Crown.
ILGA will consider the 768-page report at a special meeting on Friday, then at a board meeting on February 17.
ILGA chair Philip Crawford said in a statement that it would take some time for the authority to consider the "detailed and complex" report before committing to a course of action.
The NSW government has pledged to considers Ms Bergin's recommendations carefully before providing a formal response.
Billionaire and major shareholder James Packer escaped the worst of the report's criticism, after he revealed a bipolar diagnosis and "shameful" and "disgraceful" conduct in the witness box.
Ms Bergin found the mogul was able to manoeuvre the company's operations even after he stepped down from the board.
Though well-intentioned, his actions had "rather disastrous consequences" for the company.
ILGA should consider whether Mr Packer is fit to be a close associate of the new casino, Ms Bergin says.
But she concluded that his planned sale of a fifth of Crown to Melco Resorts did not cause Crown to breach its licence agreement with the NSW government.
The most scathing assessments were reserved for chief executive Ken Barton, director Andrew Demetriou, and director and longstanding Packer lieutenant and Crown director Michael Johnston.
Mr Barton's conduct in dealing with the accounts that were used for money-laundering was "inexplicable", his performance at the 2019 AGM "quite improper", and his turn in the witness box "most unimpressive", Ms Bergin said.
Mr Barton is "no match for what is needed at the helm" of a casino licensee, and ILGA could reasonably conclude it cannot have any confidence in dealing with him as a Crown director.
Former AFL head honcho Mr Demetriou delivered a "most unedifying" and "quite bizarre" performance at the inquiry after he was caught reading from notes but initially denied it.
Mr Johnston should "conclude his tour of duty as soon as possible" after 13 years on the Crown board, Ms Bergin said, adding that his multiple roles at the company had exacerbated its problems.
While the three remain on the board the regulator should have "very serious doubts" that Crown could be suitable to run the casino, Ms Bergin says.
Ms Bergin has left it to ILGA to decide exactly what changes Crown needs to make before gaming could begin at the Barangaroo casino.
But she makes a swag of recommendations, including a forensic probe to make sure all money-laundering in Crown accounts has been uncovered.
Crown should have to disclose any agreement to share confidential information with Mr Packer as well, she says.
The casino operator may have to enter enforceable undertaking with ILGA to fix its culture and governance.
Despite the "devastating outcomes" for Crown in the inquiry, Ms Bergin occasionally struck an optimistic tone.
"If Crown is to survive this turmoil and convert itself into a company that can be regarded as a suitable person...there is little doubt that it could achieve a fresh start and emerge a very much stronger and better organisation," she wrote.
Ms Bergin also says a new Independent Casino Commission should be set up with the powers of a royal commission to address the risks in casinos and gambling.
Crown said it was considering the report and would work with ILGA "in relation to the findings and recommendations".
Australian Associated Press