The NSW casino regulator has delayed making its decision about the future of Star Entertainment Group’s Sydney precinct after receiving the findings of a damning report into the company’s culture, while the group’s executives scramble to keep the casino business financially viable.
Adam Bell, SC, was commissioned by the regulator to launch a second probe into The Star following concerns it had not adequately committed to cultural reform since it was exposed for extensive anti-money laundering and counter-terrorism failings in 2021. The Star was due to issue its full-year results on Friday but entered a trading halt after receiving a copy of the report.
The Star was due to issue its full-year results on Friday but entered a trading halt after receiving a copy of the report.Credit: Louise Kennerley
Bell’s report found The Star was without “appropriate leadership” for 10 months over the past year with the company’s management in a “dysfunctional state”. The report found The Star’s board had competing priorities, and could not juggle between keeping the company fiscally afloat and keeping up with the remediation demands. The board failed to appropriately engage with the company’s executives, the report also said.
“Notwithstanding that improvements have been made, and are in the process of being made, it cannot be ignored that the board of Star Entertainment has, in some important respects, failed to provide the necessary leadership and oversight,” Bell said.
The report also noted the group had overhauled its board and executives since its probe commenced. It said the new appointments, including Steve McCann who formerly led Crown Resorts ahead of its Blackstone takeover, brought needed regulatory expertise to the group.
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“The level of transparency and co-operation has certainly improved since their appointments,” Crawford said.
The NSW Independent Casino Commission is not expected to shut down the group’s flagship Pyrmont casino despite the findings, as it recently moved to extend the term of its special manager until March. The Star was due to reveal what’s expected to be dismal results for the 2024 financial year on Friday, and The Australian Financial Review reported it may go as far as issuing a $1.4 billion writedown.
Commissioner Philip Crawford said on Friday that Bell’s findings had validated the regulator’s concerns, but he needed more time to decide whether to shut it down. The commission published the first two volumes of Bell’s findings on Friday.
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