Crown compliance called into question
Anti-money laundering compliance by Crown Resorts has once again come under the microscope.
The Sydney Morning Herald reports that the organisation never received a “gold star” from an independent expert, despite claims by the casino’s former boss John Alexander.
Neil Jeans from the anti-money laundering consultancy Initialism, told the New South Wales government’s inquiry into Crown’s suitability to hold a casino licence in the state last week that Mr Alexander’s comments to the press on August 21 last year did not reflect his advice to the company.
“That is not language I have ever used prior to this article being presented, in any report to any customer or in any meeting with any customer,” Mr Jeans said.
The inquiry follows an investigation in 2019 where Crown’s business with junket operators linked to powerful Asian crime gangs highlighted that its gaming floors were used to launder dirty cash.
Mr Alexander used Mr Jean’s work for Crown as part of an aggressive defence of the ASX-listed group’s reputation.
“Mr Jeans as recently as yesterday… told the board that we are completely compliant. We are a gold star customer,” Mr Alexander said during a media conference.
The comments made headlines in several major newspapers.
Inquiry hears from anti-money laundering compliance expert
But Mr Jeans told the NSW inquiry on Friday that was “not an accurate statement” and did not reflect what he told Crown’s risk management committee on August 9 and the board of directors on August 20.
Rather, Mr Jeans said he told Crown the media reports did not conflict with the findings of his compliance review, carried out from late 2018, that Crown’s anti-money laundering systems satisfied the requirements of Australia’s rules.
Mr Jeans did find room for improvement, however, including that Crown’s “highly manual” transaction monitoring system should be automated. He told the inquiry he only reviewed the design and structure of Crown’s compliance systems, rather than whether they worked in practice.
The former British police officer and AUSTRAC-approved external auditor said he raised his concerns with Crown immediately about the misrepresentation of his views.
Crown’s chief financial officer Ken Barton, who has since taken on the role of chief executive, assumed him the company would not repeat the comments.
Mr Alexander stepped down as executive chairman in January, but remains a Crown director.
Minutes from Mr Jean’s meeting with Crown’s risk management committee and board of directors, which Mr Alexander signed off on, presented to the inquiry recorded Mr Jeans as saying the media reports were “unwarranted and disproportionate.
But Mr Jeans told the inquiry that also did not reflect what he said in those meetings, as such a comment would have required a “significant degree of investigation” which was not within the scope of his work for Crown.
The NSW inquiry, which has the same powers as a royal commission, is considering whether Crown is a suitable company to hold the licence for its new $2.2 billion casino at Sydney’s Barangaroo, which is set to open in December.
Mr Jeans told the inquiry he was not aware at the time of his compliance review of the existence of patron deposit bank accounts Crown opened through two shell companies called Southbank Investments and Riverbank Investments.
The inquiry has heard Crown failed to monitor transactions in those accounts and they were used for suspected money laundering over several years.