Crown Resorts facing third probe into Melbourne casino AML compliance

Australian casino operator Crown Resorts saw its shares tumble on Monday on news of a third regulatory probe into its potential anti-money laundering compliance failures.

Crown investors took yet another kick to the nads first thing Monday when the company announced that its Crown Melbourne casino was being investigated by the Australian Transaction Reports and Analysis Centre (AUSTRAC), which “identified potential non-compliance” with anti-money laundering (AML) and counter-terrorism financing (CTF) regulations.

Crown said the probe resulted from a 2019 compliance assessment that found shortcomings in Crown Melbourne’s ongoing customer due diligence and its adoption, maintenance and compliance with AML/CTF programs. The matter has been referred to AUSTRAC’s enforcement team, which has “initiated a formal enforcement investigation” into Crown Melbourne’s compliance.

The AUSTRAC probe marks the third separate investigation into Crown’s apparently sketchy commitments to regulatory compliance, following the ongoing inquiry by the New South Wales Independent Liquor & Gaming Authority (ILGA) and the more recent ‘show cause’ order issued by Crown Melbourne’s state watchdog, the Victorian Commission for Gambling and Liquor Regulation (VCGLR).

Crown is coming off two of the more embarrassing weeks in its corporate history, thanks to the ILGA inquiry’s parade of senior management and directors all expressing various degrees of ‘what, me worry’ ignorance regarding the company’s dealings with its VIP gambling customers, including the cross-border money movement that fueled these high-rollers’ play at Crown casinos.

The NSW inquiry is far from over, with fresh professions of ignorance likely still yet to emerge. Coupled with whatever new transgressions AUSTRAC may uncover, the dirt-dishing could doom the company’s plans to launch its flashy new Crown Sydney casino in mid-December, which would put a dagger into the heart of the company’s future strategy.

Crown’s shares closed Monday down more than 8% on the day, having traded even lower before opportunistic types began buying the dip towards the end of trading. Suffice it to say, the company’s annual general meeting this Thursday, which is being held virtually due to the pandemic, should be a rip-roaring affair.

Ironically, Monday should have been a day to celebrate as the state of Victoria announced the loosening of pandemic restrictions on the movement of its citizens. The state was put on strict lockdown in July as its COVID-19 caseload soared but now says it will permit the partial reopening of non-essential retail operations starting Nov. 2.

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