Star Entertainment has agreed to pay a AU$15 million penalty (about US$10 million) after the NSW Independent Casino Commission (NICC) determined the company is still not meeting its regulatory obligations, according to reporting by Casino.org. The company may continue to run poker machines and live dealer table games at The Star Sydney.
Background to the penalty
The fine follows a 2022 NSW inquiry that concluded Star was unsuitable to hold a gaming licence in the state. According to the report, that inquiry found widespread evidence that The Star Sydney did little to combat money laundering and keep criminal syndicates away from the property.
After that inquiry, Star was allowed to keep operating the Sydney casino under a government-appointed manager. It was ordered to undertake remedial measures and was fined AU$100 million. A follow-up NICC review, two years later, found more work was needed before Star could demonstrate suitability and regain full control of its gaming permit.
What the regulator said
Announcing the penalty, NICC Chief Commissioner Philip Crawford said the second inquiry identified continuing compliance failures and that operations at The Star Sydney remained "far short of suitability". He said Star continues to have numerous shortcomings in governance, regulatory compliance, technology operations and risk management.
"In a casino setting, compliance breaches can have serious consequences for the community, and the Bell Report illustrated how quickly weak controls can lead to criminal infiltration and gambling harm." – NICC Chief Commissioner Philip Crawford
Crawford said the NICC-appointed manager, Nick Weeks, will continue to oversee The Star Sydney until at least March 2025, when another review of the casino's business will be conducted. In addition to the fine, the NICC ordered further financial and operational reporting requirements between now and March 2025. Crawford said the commission will keep monitoring Star's progress in proving it can regain its casino licence.
The commissioner also said Star CEO Steve McCann, who was appointed in June and was previously CEO of rival Crown Resorts, has kept an open line of communication with the regulator. According to Crawford, the NICC has experienced "a much healthier relationship" with Star's leadership since McCann took the job.
Financial pressure and takeover talk
Casino.org reported that Star, which operates The Star Sydney, The Star Brisbane and The Star Gold Coast, continues to run at a significant loss. It said the company posted a second straight multibillion-dollar annual loss last month, and that its shares closed at AU$0.29 on the Australian Securities Exchange on Thursday.
The publication described Star as a prime takeover target. It said Hard Rock International recently denied any interest in buying Star after the Australian Financial Review reported rumours that the company, which is controlled by the Seminole Tribe of Florida, was considering an acquisition. Casino.org also said US private equity firm Blackstone, which already owns Crown, is reportedly considering an offer. These reports are unconfirmed in the source material, and neither company's position is detailed beyond Hard Rock's denial.
What is not disclosed
The source material does not set out the specific breaches behind the AU$15 million penalty, when it must be paid, or which legislative provisions were relied on. It also does not detail what the additional reporting requirements involve. Pokiestralia has not independently verified the figures or statements, which are drawn from Casino.org's account of the NICC announcement.