Crown Resorts: what the inquiries found, and what it cost

By the time the third public inquiry handed down its findings, the picture was not ambiguous. Crown Resorts, operator of the country's most prominent casinos, had, according to the findings of successive inquiries, allowed its venues to become conduits for money laundering, permitted a junket system that carried serious criminal-association risks, and failed at almost every level of corporate governance that might have caught the problems earlier. The word used, repeatedly, was unsuitable.

That word has a specific legal weight in casino regulation. It is not an insult. It is a statutory conclusion, and it meant Crown could not hold the licences its business depended on.

In my reading, 'unsuitable' in a casino inquiry is roughly the equivalent of 'not of good fame and character' in a licensing tribunal: it triggers consequences that mere reputational damage does not. What made the Crown saga unusual was the number of times that conclusion was reached, across three jurisdictions, over roughly two years. For a comparable story, see our piece on the Star Entertainment inquiries.

How the Bergin Inquiry came about

The trigger was journalism. In mid-2019, a joint investigation by The Age, The Sydney Morning Herald and 60 Minutes published allegations that Crown's junket partners in its international VIP business had links to organised crime, that Crown staff had been detained in China in 2016 partly because of the company's marketing practices, and that the company's operations facilitated money laundering. Crown initially disputed substantial parts of that reporting.

The New South Wales Independent Liquor and Gaming Authority launched what became known as the Bergin Inquiry, formally an inquiry under section 143 of the Casino Control Act 1992 (NSW), chaired by Patricia Bergin SC. The inquiry's immediate task was to assess Crown's suitability to hold a licence for its then-under-construction Barangaroo casino in Sydney. But as evidence accumulated through 2020 and into 2021, the scope of what the inquiry was examining broadened considerably.

The Bergin Report was delivered in February 2021. It ran to two volumes and made findings that, even for observers who had been following the evidence closely, were striking in their directness.

What the Bergin Report found

The Bergin Inquiry found that Crown had, over a number of years, permitted junket operators with links to criminal organisations to operate in its Melbourne and Perth casinos. The report found that Crown's due diligence on those operators was inadequate. It found that a subsidiary of Crown, referred to throughout proceedings as Southbank Investments, had its bank account used in a way that was consistent with money laundering: large cash deposits by patrons, followed by cheque withdrawals or transfers. The inquiry found that Crown had failed to take adequate steps to prevent this.

The Bergin Report also examined Crown's response to the 2016 arrests of nineteen staff in China, finding that the board had not been properly informed of the risks the company's China-facing marketing operations carried under Chinese law, and that governance structures had failed to escalate serious compliance concerns.

On the central question, the report was direct: Crown was not suitable to hold a licence for the Barangaroo casino at the time of the report's delivery. The licence Crown had been granted could not be activated until suitability was demonstrated.

That finding had an immediate consequence for James Packer, whose private company CPH held a substantial stake in Crown. The Bergin Report found Packer unsuitable to be an associate of a licensee, largely on the basis of his conduct in attempting to influence Crown's board in relation to a proposed transaction with a company connected to a figure the inquiry described as having links to organised crime. The wider family background is covered in our profile of the Packer dynasty.

Victoria and Western Australia follow

New South Wales was not alone for long. The Victorian government established the Royal Commission into the Casino Operator and Licence, chaired by Ray Finkelstein AC QC. It reported in October 2021. The Finkelstein Royal Commission found that Crown Melbourne was not suitable to hold a casino licence under the Casino Control Act 1991 (Vic). The commission's findings on money laundering were extensive: it found that Crown Melbourne had, for years, processed transactions through a methodology, described in the report as the use of 'China UnionPay' cards and other workarounds, that facilitated the movement of funds in a way that breached relevant laws and regulations, and that Crown had prioritised revenue over compliance.

The Finkelstein report found failures across Crown's board, management and compliance functions. It made specific adverse findings about individual directors and executives, though the commission was careful, as it should be, to distinguish between findings of institutional failure and findings about individual culpability for specific conduct.

In Western Australia, the Perth Casino Royal Commission, chaired by Neville Owen, reported in June 2022, finding similarly that Crown Perth had facilitated money laundering and that Crown was not suitable to hold its Perth casino licence.

Three inquiries. Three jurisdictions. Three findings of unsuitability. It was, as far as I can establish from the published record, without precedent in Australian casino regulation.

The governance failures the inquiries identified

One thread running through all three reports was the question of how this persisted for so long without being addressed internally. The Bergin Report found that Crown's board had, at various points, been inadequately informed of serious compliance risks. The Finkelstein commission found a culture in which compliance concerns were subordinated to commercial considerations, and in which the board lacked the independence and expertise to properly oversee management.

Specifically, the Finkelstein commission examined the role of the audit and risk committee and found it had not functioned effectively as a check on management. The commission found that Crown had effectively operated, for a period, as a company in which the interests of its then-dominant shareholder, the Packer interests through CPH, had a disproportionate influence on board decision-making.

This is a pattern that will be familiar to anyone who has read the Hayne Royal Commission's findings on financial services governance. As the Hayne Royal Commission found across the banking sector, the structures nominally designed to protect against misconduct can fail when boards are not genuinely independent and when compliance is treated as a cost centre rather than a function with real authority. Crown's situation was, if anything, more acute: the compliance failures had direct criminal-law dimensions that the financial services failures, serious as they were, often did not.

AUSTRAC and the civil penalty

Alongside the casino-regulation inquiries, the financial intelligence agency AUSTRAC launched a civil penalty investigation into Crown Melbourne and Crown Perth for alleged breaches of the Anti-Money Laundering and Counter-Terrorism Financing Act 2006 (Cth). In May 2023, the Federal Court approved a settlement under which Crown agreed to pay a civil penalty of $450 million, the second-largest civil penalty in Australian history, behind the $700 million penalty levied against the Commonwealth Bank following AUSTRAC's action over that institution's ATM reporting failures.

Crown did not admit to the findings of the casino inquiries as such, but agreed to pay the penalty in resolution of the civil proceedings. The penalty was, the Federal Court noted, one of the largest ever imposed on an Australian company.

It helps to understand what a civil penalty is. AUSTRAC is both the national financial intelligence unit and the regulator of anti-money laundering and counter-terrorism financing obligations. When it alleges breaches, it can bring proceedings in the Federal Court of Australia, which can order a monetary penalty. That is a different track from a criminal prosecution, and it does not produce a criminal conviction.

The ownership consequences: Blackstone's acquisition

Crown's suitability problems coincided with, and to a significant degree drove, a fundamental change in who owned the company. The American private equity firm Blackstone had been building a stake in Crown through 2021 and into 2022, and in mid-2022 successfully completed a takeover of the company, taking Crown private at a price of approximately $8.9 billion.

The practical effect was to remove the Packer interests from the register as the dominant force, which the various regulators had identified as a structural requirement for any rehabilitation. Each of the three state gaming regulators conducted their own suitability assessments of Blackstone before approving the ownership change.

Crown subsequently began what the regulators described as a remediation programme: installing new independent directors, overhauling compliance frameworks and engaging a special manager to oversee operations at Crown Melbourne, as the Finkelstein commission had recommended. The Victorian Commission for Gambling and Casino Control conducted periodic reviews of progress. By late 2023 and into 2024, Crown had, according to public regulatory statements, made sufficient progress on remediation that full suitability was restored in Victoria and New South Wales. The path back was long and supervised.

What the inquiries changed beyond Crown Resorts

The Bergin Inquiry, in particular, had implications beyond Crown itself. Its findings prompted a broader re-examination of casino regulation across Australian jurisdictions: the adequacy of junket oversight, the requirements for continuous due diligence on high-value patrons, and the structural independence of gaming regulators from the operators they oversee.

I'd argue the more durable change was the demonstration that sustained investigative journalism, combined with a well-run public inquiry, can force accountability in an industry that had, for decades, operated with relatively light regulatory scrutiny partly because of the revenue it delivered to state governments. The political economy of casino licensing (large licence fees, tax revenue, employment) had historically made regulators cautious about pushing too hard. The Bergin process showed what happened when that caution was set aside.

The findings also underlined something the James Hardie compensation saga and others have demonstrated: that 'corporate governance failure' is not a bloodless euphemism. At Crown, the governance failures had real consequences for the integrity of the financial system, for the communities surrounding the casinos, and eventually for the shareholders who held a company that had been, in the regulatory language, unsuitable for years before anyone said so publicly.

The record is now public. Three inquiry reports, a Federal Court judgment on the civil penalty, and several thousand pages of findings. For anyone who wants to understand how a publicly listed company at the centre of Australia's gambling industry arrived at that point, the material is all there; the Crown Resorts encyclopaedia entry is a reasonable place to start.