Crown Anti-money Laundering Training Called Into Question

Training about the perils of money laundering was only given to members of Crown Resorts board two months ago, the Victorian royal commission into the besieged casino operator has heard.

The Australian Financial Review reports that the first time Crown Resorts directors received anti-money laundering training in person was last March.

Before that, the training was conducted online.

Giving evidence at the royal commission examining the suitability of Crown Resorts to operate its Melbourne casino, Crown’s head of anti-money laundering, Nick Stokes, said: “I believe the only training they had received was the online module,” which could take as little as 30 minutes.

I believe the only training they had received was the online module,” Stokes claimed.

Mr Stokes, who joined Crown in November 2019 following media revelations of money laundering linked to Crown’s junket programs, said the recent face-to-face training was run by Steven Blackburn, Crown’s new chief compliance and financial crimes officer.

Mr Stokes said when he joined Crown he had to copy in the chief executive, Ken Barton, to request more resources to beef up the anti-money laundering program.

“My direct supervisor at the time, former general counsel Josh Preston, didn’t believe that we needed the amount of resources that I was after,” he said.

Victoria’s royal commission was sparked by the NSW Bergin inquiry, which found Crown unfit to open its Sydney casino because it had facilitated the laundering of hundreds of millions of dollars via its partnerships with junket operators with links to criminal gangs and triads.

Crown announced its decision to axe junket partnership last Wednesday, the evening before the group was due to front the royal commission for the first time over its failure to prevent money laundering and criminal infiltration via its junket program.

Junkets are organised by gambling tours for foreign VIP high-rollers.

Royal commissioner Ray Finkelstein cast doubt on whether Crown’s decision to axe junkets at its Melbourne casino would be enough to prevent organised crime and money laundering from reinfiltrating the casino giant.

He flagged concerns that high-rollers previously linked to junket operators would now be dispersed and could just turn up at Crown to launder money unless Crown committed to doing deep background checks on them.

Mr Finkelstein asked Murray Lawson, the Deloitte consultant hired by Crown to examine its money laundering risks, if the players previously linked to junkets would effectively be put on a watch list because they were higher risk.

All the players who…previously came here through a junket operator…Crown is likely to go and chase them directly – that makes business sense?” Commissioner Finkelstein asked.

“Possibly,” Dr Lawson said, adding it would depend on the kind of new customer relationship Crown had with them, indicating they could be folded into standard anti-money laundering checks done on regular players.

Dr Lawson told the commission Crown withheld due diligence reports on key junket operators linked to organised crime from him when he was examining its anti-money laundering systems in 2020.

The reports, on junket operators linked to organised crime such as Alvin Chau’s Suncity and another operator, convicted criminal Song Zezhai, were deemed “too sensitive” by Crown former top legal counsel, Josh Preston, to be subject to review.

Counsel assisting, Penny Neskovcin, QC, told the inquiry in her opening remarks that Suncity produced a turnover at Crown Melbourne that “exceeded’ $20.5 billion in the 2015-18 financial years.

Overall, Crown’s revenue from junkets in the 2017 financial year was approximately $200 million, in 2018 it was $400 million and in 2019 it dropped to $300 million, she said.