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Victoria regulator rules Crown can retain Melbourne casino licence

| By Robert Fletcher
The Victorian Gambling and Casino Control Commission (VGCCC) has ruled Crown Resorts is suitable to hold a licence and therefore continue operating its Melbourne property.
Crown Melbourne Victoria casino

It is in the “public interest” that Crown retains the licence, the VGCCC said. Crown Melbourne is the largest single-site employer in Victoria. 

The decision follows widespread changes at the casino in the wake of the Royal Commission into casino licences. The Commission was scathing in its criticism of what it deemed “illegal, dishonest, unethical and exploitative” behaviour.

In October 2021, the report published by the inquiry deemed the casino “unsuitable” to hold a casino licence in Victoria. However, Crown should not immediately lose its licence due to the potential economic impact, it added.

The Commission instead set out a series of recommendations to improve practices. Over the following two years, Crown made wholescale changes to operations to comply with such measures. These included new safer gambling responsibilities to prevent gambling harm such as a mandatory cooling-off period.

This transformation included the Melbourne Remediation Action Plan, which implemented 342 initiatives across eight workstreams. Areas of focus included financial crime, compliance and risk, governance, harm minimisation via Crown PlaySafe and culture.

The Victoria government then appointed a special manager to oversee operations and remediation at the casino. The VGCCC was created as a sole regulator for gambling in the state, with a specific set of enhanced powers with respect to the casino.

Following these steps the Commission was given the responsibility of deciding whether Crown was suitable to hold the licence. Having taken into account Crown’s effort, with the operator saying it spent over AU$200.0m (£103.4m/€120.6m/US$130.9m) on its transformation, the operator held on to its licence.

Crown addresses “systematic failures”

Speaking on the case, Commission chair Fran Thorn said the special manager’s final report concluded Crown Melbourne remediated the failings exposed in the Commission. It also established “critical foundations” to achieve sustainable overall transformation.

“There was no evidence of maladministration, or illegal or improper conduct indicative of the serious and systemic failures previously identified by the Commission,” Thorne said. “These failings had been addressed.

“In return for the privilege of an exclusive licence, Victorians have a right to expect that Crown Melbourne will never again prioritise profit ahead of the safety and wellbeing of its patrons and staff or over compliance with its legal and social obligations.”

Crown will continue to be under scrutiny in the state, Thorn added. It must deliver further transformation through a statutory direction, with details to be issued shortly.

“That transformation plan will be at the heart of our oversight, along with Crown’s legal and social obligations, and provides the next level standard for Crown Melbourne,” Thorn said.

“Crown Melbourne must continue to seek to rebuild and earn public trust by demonstrating the good character, honesty and integrity that are necessary to remain a suitable casino operator. We put Crown on notice that we will not hesitate to act if the privilege of holding the licence is again abused.”

Crown Melbourne welcomes “significant” milestone 

The decision will come as a welcome relief to Crown. The operator has already faced heavy regulatory penalties in the state in the wake of the Commission.

In November 2022, the VGCCC issued Crown Resorts two fines totalling a record $120m for a series of failings. The VGCCC said Crown failed its responsible service of gambling obligations over a number of years. Customers gambled for long periods without a break, sometimes for more than 24 hours, it found.

Retaining its Victoria licence ranks among the most significant milestones in Crown Melbourne’s 30-year history, property CEO Mike Volkert said.

“What we have achieved must be a continual focus for everyone at Crown Melbourne,” Volkert said. “We know the work doesn’t stop here, and we are committed to delivering the highest industry standards and putting the welfare of our guests at the forefront of decision-making, day in and day out.

“Crown Melbourne is now the safest venue in Victoria for gaming and entertainment. We look forward to continuing to welcome our guests.”

The Blackstone impact 

Crown Resorts CEO Ciaran Carruthers also welcomed the decision. He said the acquisition of Crown by private equity giant Blackstone in June 2022 played a major part in the successful transformation.

“Since the acquisition by Blackstone, and the appointment of new boards and a executive leadership team, Crown has pioneered one of the most complex transformations ever undertaken in Australia,” Carruthers said.

The steps taken amounted to “fundamentally rebuilding our organisation from the inside out”, in Carruthers’ eyes.

“Holding a casino licence is a privilege and an obligation we take extremely seriously. I am proud of what our team has accomplished and the safe environment Crown Melbourne now operates in.

“Together we have built a stronger, better Crown. Our unrelenting focus will remain on delivering the highest standards of integrity, harm minimisation and service excellence across our industry.”

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