Star’s group manager of due diligence and intelligence Angus Buchanan provided a large amount of information about the operator’s relationship with Suncity and its owner Alvin Chau.
Buchanan testified that he had created a report about then-Suncity chair Alvin Chau for the Hong Kong Jockey Club, recommending that Chau should not be a member. This report detailed alleged ties to organised crime, including claims that Chau had been a member of a triad.
Buchanan larter sent this report to Star management as an example due diligence report soon after he joined the business in 2019.
Despite this report, the Star continued to work with Suncity, allowing the junket operator to operate its own private gaming room at Star Sydney.
In this room, evidence presented showed Star operating a cage, allowing it to exchange cash for chips – something that only the operator itself was permitted to do. CCTV footage showed customers bringing large sports bags filled with cash into the Suncity gaming room, with this cash then being exchanged for gaming chips.
Suncity received a warning from Star management for conducting this activity in 2018. However, Buchanan acknowledged that there were “a myriad of transgressions in contravention of
the agreed service desk protocols” at Star’s gaming room even after the warning.
Counsel assisting the inquiry Naomi Sharp also noted that Suncity was “not prepared to cooperate and account for the large movements of cash”, which Buchanan acknowledged was “concerning”.
The Suncity room – known as Salon 95 – ultimately stopped operating in August 2019.
However, Buchanan said the junket then began operations at a new room, which had no Suncity signage.
According to one email sent by the Star’s head of media relations, when asked last week why the operator was still using Suncity, chief executive Matt Bekier replied, “Why not?”
Earlier today, Bekier resigned from his roles as chief executive and managing director of Star Entertainment Group in connection to issues raised during the review.
Buchanan also produced a new report on Suncity for The Star in late 2020, while investigations were being conducted into rival operator Crown’s junket ties.
Sharp argued that Buchanan had “watered down” his report from an initial version in which alleged links to triads were more described in more detail, as Star management wished to see the relationship continue. However, Buchanan rejected this assertion.
SunCity and its owner Alvin Chau have faced significant legal trouble recently. Chau was one of 11 people arrested in Macau on 27 November as part of an investigation into an illegal cross-border gambling syndicate.
Following the arrest, Chau announced he would step down as SunCity and Summit Ascent chairman, while remaining the controlling shareholder of the SunCity Group.
The inquiry also heard evidence from Graeme Stevens, who was group compliance manager for the operator.
Stevens discussed the use of China UnionPay cards at The Star’s facilities. These cards are issued by Chinese banks and allow Chinese citizens to spend money abroad beyond the country’s US$50,000 foreign exchange limit for individuals. However, certain types of transaction – including gambling – are not permitted with the cards.
Previous witnesses had already detailed that these cards were swiped with a merchant code for hotel services, despite being used for gambling.
Stevens said he was not familiar with the rules against using the cards for gambling.
Sharp also asked Stevens about The Star’s temporary cheque-cashing facility. At this facility, rather than players writing cheques – as is the only permitted form of playing with credit in Australia – Star issued its own counter checks in order to grant customers credit to play.
Stevens acknowledged that he did not seek regulatory approval for this “workaround”, despite a previous suggested workaround having been rejected by New South Wales Authorities. However, he said he “didn’t think it wasn’t lawful”.
In addition to the state regulatory authority, The Star is also under investigation from the Australian Transaction Reports and Analysis Centre (Austrac).
In October 2021 Star Entertainment dismissed reports that it had allegedly overlooked a KPMG report regarding money laundering failings at the business.
The Australian casino industry has faced a number of inquiries in recent years, with rival operator Crown Resorts also being subject to major scrutiny.
In addition, Crown was deemed “unsuitable” to operate a casino in Victoria in October last year. However, it was allowed to hold onto its licence.
Last week, an inquiry into its operations in Perth also found Crown “unsuitable”, but again allowed it to keep its licence.