Star Entertainment Still Collaborating With Junkets

Australian casino giant Star Entertainment admitted it still collaborates with major junkets despite their links to organised crime. Star claims it hasn’t uncovered enough evidence of wrongdoing to put an end to its relationship.

The New South Wales (NSW) gambling regulator is looking into the casino’s relationship with junkets. One, in particular, Suncity, is under the spotlight of the NSW Independent Liquor and Gaming Authority.

An inquiry into Star’s use of junkets heard Star hadn’t uncovered enough hard evidence to end their relationship with Suncity.

NSW’s gambling regulator stepped in after being advised by the Department of Home Affairs. It learned Australia banned Suncity junket owner Alvin Chau from entering the country.

Star Sydney closed Suncity’s private high-stakes room in 2019 after learning of Chau’s barring. The private room moved to another area of the casino. Star’s internal anti-money laundering team began investigating the goings on in the junkets. That anti-money laundering team reported its finding back to Star’s Chief Casino Officer, Greg Hawkins.

Hawkins spoke at the inquiry and informed the panel everything seems legitimate.

“Certainly, none of it has been forwarded to me that would change our association with the junket at this point.”

Hawkins previously worked for Crown Resorts at its Melbourne casino. He admitted to the inquiry he and Chau had met a couple of times in social situations. He also said he has doubts about Chau’s involvement in organised crime back in China.

“I do have some doubts. All I’ve read is speculation but I’ve nothing to validate it. I wouldn’t pretend to full understand the concepts of organised crime or what it relates to in that part of the world.”

What Are Casino Junkets?

Junkets are trips or celebrations attended at the public’s expense. Casino junkets are trips offered to VIP customers to travel and play at a specific casino. The vast majority of junkets operating with Australian casinos hail from China.

China has extremely strict gambling laws but its well-heeled residents like to play pokies and table games. This is impossible unless they visit Macau. There are also strict rules regarding taking Chinese currency out of the country. This is a stumbling block for the Chinese VIPs who often play games such as baccarat at $100,000 per hand.

Junkets take care of all this for the VIPs for a fee. Casinos pay the junkets large sums of money for effectively smuggling VIPs into the country. The junkets are extended credit at the casino and they payout the VIPs on their return to China.

The practice isn’t illegal. Using junkets is something of a grey area. Well, it’s not illegal if the junket doesn’t have links to organised crime.

Crown Resorts learned six years ago that Chau had strong links to organised crime. They learned Chau was a former member of the 14K Triad gang in Macau. Triad members are not allowed to leave the gang so they never truly leave their criminal pasts.

The late Stanley Ho was linked to triad activity throughout his life. The links were that strong New Jersey stopped Ho from holding a casino license in the United States.

Not The First Time Chinese VIPs Have Causes Concern

Crown Resorts and Star Entertainment make ridiculous sums of money each year. A substantial percentage of this comes from Chinese VIPs who spend billions of dollars.

Crown reported a 26.1% reduction in VIP play in its 2019 financial report. This equated to $38.0 billion, showing how important junkets are to casinos.

Ironically, that reduction was partly down to an inquiry into Crown’s use of junkets, particularly Suncity. Reports of Crown organising private jets so VIPs could bypass customs came to light. Other reports included Crown employees finding drug dealers and prostitutes for mega-rich customers.