Crown Resorts has found itself the subject of an inquiry due to shocking allegations linking it to threats and other criminal activity. The government is looking into whether the social licence should be taken from Crown Resorts to operate a casino in Barangaroo, Sydney. The Crown’s directors and stakeholders, including some politicians, all face scrutiny as the inquiry was launched after billionaire James Packer sold his shares in Crown to Melco for CA$1.76 billion, back in May 2019. James Packer was Crown’s biggest shareholder and Executive Chairman. He has also admitted, under oath, to his behaviour being less than professional back in 2015.
Melco belongs to Lawrence Ho, who is the son of Stanley Ho. When the New South Wales government granted Crown Resorts a licence to operate, it did so with a specific clause that there would be no deal with or shares sold to Stanley Ho or his partners due to their links to the world of organized crime. Mr Packer sold his stakes in breach of this regulation.
The evidence that has come out during the inquiry is quite shameful to say the least. Some of it includes money laundering as well as secret bank accounts to avoid anti-money laundering regulatory requirements. Mr Packer is also involved, with executives giving him confidential information when he was no longer on the board. The Crown Resort case is one in which politicians and regulators are shown to have failed to act in good conscience.
Relating to Mr Packer himself, the inquiry looked into allegations of threats sent by Mr Packer via email back in 2015. The recipient of the threatening emails was only identified as Mr X, and he was a private equity executive. Crown Resorts was, in fact, looking to start trading privately. Mr Parker joined in the inquiry via video because of the pandemic, and interestingly, he denied no wrongdoing and admitted that his behaviour at the time was “disgraceful”.
What is peculiar is that when the board of inquirers asked Mr Packer if he was aware that his threatening emails had come across as ‘frightening’, Mr Packer answered that he was not and that he was surprised by this news. He also added that he was confused as to whether or not he was on the board of directors at the time in question. Records show that he was. His explanation to his reprehensible actions was that he was very sick back then, suffering from an untreated bipolar disorder. He could not even remember being mentioned for the position of head of global strategy in 2016, as he stated that whole months were missing from his memory due to being so unwell.
Mr Packer was given strong medication to treat his bipolar disorder in 2016, so when asked about confidence in his character, he said that his actions were more a reflection of his serious disorder rather than of his integrity as a person. With this reasoning, Noel Hutley, Mr Packer’s lawyer, asked the board of inquirers not to see the emails. He also stated that it would be unfair to Mr Packer’s person for the contents of the email to be leaked since these are not of public interest. This was agreed on by the judge, but the little that had already been leaked is quite notable since the threats made by Mr Packer involve a person tied to Mossad, Israel’s Intelligence Army.
At the moment, James Packer still owns a 37% share of Crown Resorts but has no intention of ever being on the board again, saying “this has been a terribly painful and terribly shocking experience for the board as it has been for me. I won’t be going on the board again. I think the board will be more independent than it was in the past.”
The enquiry report will be published in 2021.