By Josh Gordon
Casino giant Crown Resorts has been hit with a $30 million fine for illegally allowing punters to gamble by signing over thousands of uncleared bank cheques to the value of at least $1.5 billion.
An investigation by the Victorian Gambling and Casino Control Commission (VGCCC) estimated the casino raked in between $30 million and $75 million in extra profits from the practice over more than two decades.
Under the practice, first exposed by The Age in 2014, patrons were given casino chips to gamble simply by signing the back of uncleared bank cheques – made out to them, rather than the casino – with their membership number.
This, the VGCCC said, effectively provided gamblers with a line of credit they should not have been able to access.
The VGCCC said it was a “serious contravention” because it was undocumented, long-running and subverted the important controls on the use of cheques at the casino.
“This is the second time we’ve taken action on undocumented practices at the casino, and we will investigate further to ensure there are no more,” commission chair Fran Thorn said in a statement on Thursday.
“To be clear, we will not allow the casino to conceal its practices to avoid scrutiny.
“Practices like accepting bank cheques expose Crown to the risk of money laundering, put patrons at risk of gambling harm, and compromise our ability to ensure the casino runs with integrity, safety and fairness.”
Crown said it accepted the fine.
“These practices have ceased, and we have implemented significant improvements to reduce and prevent risk across our business,” a spokesperson for the casino said in a statement.
“We will comply with the directions issued and work constructively with the VGCCC and the government to address this and other issues raised as part of the Victorian royal commission.”
‘We will not allow the casino to conceal its practices to avoid scrutiny.’
VGCCC chair Fran Thorn
The 2021 royal commission into Crown found “disgraceful” legal and ethical breaches and exposed behaviour that was “illegal, dishonest, unethical and exploitative”.
The VGCCC also examined a royal commission conclusion that Crown probably accepted blank cheques in exchange for gambling chips, but said there was insufficient evidence to establish that.
Crown was fined $80 million last year over its illegal practice of accepting $164 million in funds between 2012 and 2016, and another $120 million in November for breaches of its responsible service of gambling obligations.
The latest report from the VGCCC found that Crown had not provided details to accurately estimate the amount of revenue it had made from allowing people to sign over bank cheques to gamble.
But it said information provided to the royal commission suggested, conservatively, that an average of $62.5 million a year was accepted – more than $1.5 billion between 1994, when the casino opened, and 2021, when the practice ceased.
Assuming that 5 per cent of that amount was gambled and lost, it estimated that Crown Melbourne would have made $75 million from the “illegal conduct” constituted by the bank cheque practice, or $30 million assuming 2 per cent losses.
It said between September 2013 and May 2021, about 2900 bank cheques worth about $500 million had been signed over to Crown or exchanged for chips before the cheque had cleared.
Monash University’s Charles Livingstone.
Monash University associate professor Charles Livingstone said the finding was emblematic of how Crown had operated in Melbourne over many years, suggesting the casino’s “crimes and misdemeanours” would haunt it for some time yet, even under new owners.
“This is a further reminder that the regulatory oversight in Victoria was severely lacking over many years,” he said.
In one example of the practice that was presented to royal commission, Ahmed Hasna, a gambling addict who had already twice banned himself from the casino, signed over a bank cheque made out to him for $100,000 worth of casino chips before the cheque had cleared.
Hasna then lost all the chips playing roulette in the casino’s premium Mahogany Room, before the cheque was dishonoured by his bank. Crown then took steps to recover the money.
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