The Star Entertainment Group is facing even more serious regulatory challenges as the New South Wales inquiry continues to delve into its questionable practices and has discovered fresh evidence that the Group has overlooked an important part of its duties. According to the Australian Financial Review, The Star Entertainment Group helped high roller cash out as much as $70 million in two years but never bothered checking whether the money was in any way breaching AML policies.
High Roller Processed $70m in Two Years
Chinese property developer Philip Dong Fang Lee used his credit card to deposit as much as $23 million in just three days back in April 2015. By 2017, the man had as much as $46 million with the casino, but The Star did nothing to pass the matter to financial regulators in the country, including AUSTRAC which could have investigated the origin of the money.
The Star extended this courtesy to Lee, it seems, as he was one of the casino’s most valuable customers, putting the property in a delicate position. Naomi Sharp SC, a counsel assisting the inquiry, asked whether the fact that Lee’s gambling was not an exact match to his UnionPay payments made The Star think that they were used as a “fat ATM.” Responding to the question, The Star NSW CEO Greg Hawkins argued that the company had some reservations about the deposits.
Investigators discovered that in the 15 years that The Star and Lee had a relationship, the latter had purchased a total of $2.72 billion in chips, but not all were used to gamble. He would often take large sums of money, including $20.5 million worth of gambling plaques denominated in $500,000, and leave the property.
This only adds to the current set of troubles The Star is facing. The company has been found to purposefully chalk up gambling transactions amounting to $900 million as hotel expenses, all processed through UnionPay. To add further insult to injury, The Star issued no international transfer reports, possibly assisting Lee to conceal the money from UnionPay and avoid sanctions from Beijing.
Was Hawkins Kept in the Dark?
Hawkins argued that this decision was not motivated by a desire to help Lee hide anything. He said that he had not even entertained the idea when obliging Lee. After being questioned on the matter and denying knowledge or intent, Adam Bell, SC, the man leading the interview, asked whether Hawkins agreed that he should have been open to the possibility it was indeed the case.
Hawkins answered in the affirmative. The Star also faced more challenges in recent times, as the company possibly avoided paying $2.5 million in tax to the NSW government as it failed to properly categorize gamblers, and whether they were overseas visitors and Australian residents. That allegedly happened in 2020.
Hawkins was asked whether he would consider it true that there were “siloed” channels of communication within the company he was not privy to, hence why he remained blindsided by certain developments directly pertaining to his duties. Hawkins agreed that this was indeed the case. The inquiry continued and grilled Hawkins over other questionable practices by the casino, including arrangements with junkets and other VIP customers who posed a threat according to the regulator.
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