Crown Casino Perth wheels keep turning despite damning royal commission assessment

Once again, one of Crown’s casinos has effectively proven to be too big to fail.

Like its Victorian counterpart last year, the Perth Casino Royal Commission’s final report found Crown unfit to hold WA’s only casino license – but gave it two years to work out its issues.

Through numerous high profile investigations and the media coverage that sparked them, Australians have heard many stories of how Crown and its regulators have failed to stop criminals washing their dirty money through their casinos. and also exploited vulnerable problem gamblers for profit.

But, again, that wasn’t enough to strip the casino giant of its license.

The royal commission identified a series of failures by Crown, but it was not the only one criticized.(ABC News: Andrew O’Connor)

The Crown Perth resort complex is a big contributor to the state coffers, is an important tourist asset and employs thousands of people.

But while much has been said about its status as WA’s largest private employer, it’s unclear how many employees work in the casino and how many staff its many hotels, restaurants, bars and reception centers that could presumably still operate without a casino.

Despite the damaging findings of the WA Royal Commission, the WA government only said it accepted its 59 recommendations and was vague when asked if it would implement some of the most important ones.

For example, Racing and Gaming Minister Tony Buti would not commit on Thursday to regular casino license reviews at least every five years, as demanded by Victoria.

He also could not say when they will appoint someone to oversee Crown Perth’s remediation or who that person might be.

In Victoria, they immediately announced that a QC would be a special administrator for Crown Melbourne.

Mr Buti told WA Parliament on Thursday that their priority reforms were to give additional powers to the casino watchdog to mitigate risk at Crown Perth, as well as improving its independence from government.

The Crown casino logo is affixed to a colored panel.
Victoria was quick to announce that a QC would be appointed special administrator of Crown Melbourne.(ABC News: Darryl Torpy)

Their strongest language has been how the WA ban on poker machines will be maintained.

“There will be no weakening of this necessary ban,” Dr Buti said.

Poker machines are banned by laws that also don’t define what they are exactly.

The royal commissioners have recommended the government consider whether it should continue to ban poker machines and, if they do, have suggested they define them to help regulators understand exactly what is banned.

A blonde woman is sitting with a drink in a slot machine.
The government is committed to continuing its hard line on poker machines in WA.(ABC News)

Financial crime threatens to test the government

For all the McGowan government’s penchant for appearing tough on crime, its real test will be how tough it is on financial crime – like money laundering and criminal infiltration in Crown Perth – while this could adversely affect its results.

As the report points out, Crown has paid an average of $2.9 million per year in license fees (a contribution to the cost of casino regulation) and $58.4 million in casino tax over the past few years. pre-COVID years in WA government.

Two bound books with purple covers stacked on top of each other, with the words 'Perth Casino Royal Commission' on the front.
The 1,000-page report released Thursday makes 59 recommendations.(ABC News: Keane Bourke)

Casino tax is a percentage of gross gambling revenue. As the Bergin Inquiry revealed, for many years casino revenue included contributions from suspected criminals and money launderers who spent a lot of money on tours in Crown Perth.

A big source of revenue in recent years, since junkets were banned after Bergin, have been electronic gaming machines (EGMs), with gamers spending more than $306 million on Crown Perth’s 2,500 machines last year .

Large, brightly lit discussion building next to the rounded lower building, both reflecting in the still dark water of the river.
The report found regulatory loopholes allowed alleged money laundering to continue at Crown Perth without question.(ABC News: Andrew O’Connor)

Although Crown has said it will work cooperatively with the WA Government on the recommendations, you wouldn’t expect it to be thrilled with some of them.

The question is also how Blackstone Inc – whose takeover of Crown and its casinos in Perth and Melbourne has yet to be ticked off – would operate with this new operating environment.

Gaming machines inside the Pearl Room at Crown Perth, with gaming tables and casino staff in the background.
The Pearl room in Crown Perth is for high level players.(Supplied: Crown Perth)

High spenders and problem gamblers in the spotlight

If implemented, many of the recommendations appear likely to affect Crown Perth’s revenue from EGMs, as well as high spending and problem gamblers – which could also affect WA government tax levies.

These included:

  • Pearl Room applicants must prove they have the financial means to perform – and show it regularly
  • Time limits for AGEs, with a mandatory break after three hours of play, no more than 12 hours of play per 24 hours, and no more than 28 hours of play per week
  • Reduce EGM minimum bet size to $10
  • EGM players must preset weekly losses and time limits for the game
  • Mandate card play on EGMs, which could highlight potential gambling harms and reduce the risk of money laundering
  • New laws requiring casino licensee to mitigate gambling-related damages

Over the next couple of years, we’ll see if Crown has a business model that can both meet its regulators’ anti-money laundering and responsible gambling requirements and turn a decent profit.

A man with an orange and gray beard but more brown hair wearing a suit and tie walking to the right of the frame.
Former casino manager Michael Connolly’s testimony to the royal commission did not absolve him of criticism.(ABC News: James Carmody)