Crown and Star To Phase Out Cash
Crown Resorts and The Star are to phase out cash from all their casinos, according to the Sydney Morning Herald. The plan to phase out cash will assist the companies in their fight against money laundering at their gaming tables.
The move to phase out cash helps pave the way for Crown to finally open its $2.2 billion Barangaroo casino in Sydney. Regulators denied Crown a casino license following evidence of money laundering at its Melbourne and Perth casinos.
NSW Independent Liquor & Gaming Authority (ILGA) revealed it, and Crown agreed on several matters relating to the Barangaroo casino. That included Crown making “all gaming in its casino cashless with card technology linked to identity and a recognised financial institution.”
Furthermore, Crown is in discussions with the Victorian and Western Australian governments to phase out cash at its Melbourne, Perth, and Sydney casinos.
Star Entertainment, a potential suitor for Crown Resorts, is following in its rival’s footsteps. It too plans to phase out cash at its gaming tables, although it will do it in phases.
“This will be a gradual transition with the customer in mind, with an implementation timeline still to be determined.”
Plans To Phase Out Cash Could See Barangaroo Open Before October
The plans to phase out cash at its casinos are the latest step Crown is taking to obtain an operating license in Sydney. It opened its $2.2 billion Barangaroo resort on December 28, 2020, but its casino remains off-limits. Crown promised to stop using junkets while 37% stakeholder James Packer stepped away from the day-to-day running of Crown.
Crown’s continued reforms are pleasing the ILGA. Crown’s Barangaroo casino may open before the end of October if the progress continues.
“We’ve extended the liquor licence until the end of October,” ILGA chairman Philip Crawford said. “And I think you can assume that we are hopeful and or confident that the opening of the gaming rooms will happen well in advance of the end of October.”
Crawford covered his back by adding a caveat to his time frame, one relating to the independent audits into Crown’s anti-money laundering systems.
The ILGA demanded the audits following the damning Bergin inquiry. The inquiry saw video footage of hundreds of thousands of dollars in cash being exchanged for casino chips at a private gaming room at Crown Melbourne. In addition, Crown discovered $5.6 million in cash stored in a cupboard in a room used by its biggest junket operator in 2018.
Financial Cost of the Bergin Inquiry Revealed
The Victorian Commission for Gambling and Liquor Regulation hit Crown with a $1 million fine in April. Crown is on the hook for an additional $12.5 million to the Bergin inquiry.
Crown agreed to pay $12.5 million towards the cost of the Bergin Inquiry. An additional $5 million a year for the next two years is the cost for government supervision of its Sydney casino.
ILGA’s Crawford revealed Crown is to stop all smoking in its casinos by 2022 in addition to its plans to phase out cash. Currently, Crown allows smoking in some of its high roller gambling rules under a special arrangement. That is set to end, and all Crown’s Australian casinos will become smoke-free.
Crawford made Crown aware its potential $12 billion merger with The Star is under close scrutiny.
“It’s not going to be a tick-and-flick exercise. We want to know a lot more about the merged entity. What it looks like. And work out our own strategy to make sure that from a regulatory viewpoint, we were comfortable with the model.”
Neither Crown nor The Star has shared any additional information about their potential merger. Likewise, Blackstone Group is yet to hear anything concrete about its possible takeover. Blackstone revised its $8.02 billion offer ($11.85 per share) to $12.35 per share following news of Star’s merger plans.
