James Packer has admitted to multiple failings in his oversight of corporate governance at Crown Resorts’ Perth casino during royal commission hearings on Friday.
Giving evidence via video link to a royal commission hearing in Perth on Friday morning, Packer spoke slowly and frequently struggled to recall events while he was chairman of Crown’s West Australian subsidiary, Burswood Limited, which held the license for the Perth casino.
Under questioning from counsel assisting the commission, Patricia Cahill, SC, he admitted to failings including not attending board meetings for almost four years after he moved overseas and not ensuring the board had a written charter.
The West Australian royal commission is the third state-based inquiry into Crown Resorts’ operations to be sparked by Nine Entertainment’s Crown Unmasked series in 2019, which made allegations about money laundering and criminal involvement in junkets that operate at the group’s Melbourne and Perth casinos.
In February an inquiry in NSW, where Crown hopes to open a new casino at Barangaroo, found that the company facilitated money laundering through bank accounts associated with the Melbourne and Perth casinos, and that criminal groups were involved in the junkets.
These findings were endorsed by a royal commission that reported back to the Victorian government this week which made additional findings that Crown underpaid state gambling taxes and failed in its responsibility to minimise harm to gambling addicts.
Packer owns 37% of Crown through his company Consolidated Press Holdings but the Victorian royal commission has recommended he be forced to sell down to 5% by September 2024 – something Packer that on Friday was something to which he does not object.
The billionaire was formerly executive chair of Crown but stepped down from the board in 2018.
While at Crown, he was chair of Burswood from 2004 until 2016.
Under questioning from Cahill he agreed that he did not attend Burswood board meetings after leaving the country in 2013, but continued to receive updates on casino operations from Crown’s then head of Australian resorts, Barry Felstead.
“There is no doubt I should have attended or resigned,” he said.
“I did neither.”
He said that the fact Burswood had no board charter was a failure of corporate governance by him and the chief executive at the time, Rowen Craigie.
“I think Rowen and I both overlooked the need for a charter,” he said.
Cahill asked: “And was there anyone appointed [to the board] who had financial crime risks management experience such as anti-money laundering expertise?”
“I don’t believe there was,” Packer responded.
Asked by Cahill if this was an oversight, he said: “Looking back there are many oversights and things that should have been done differently.”
Packer was also unclear on which entity within the casino group, Crown Resorts or Burswood, had responsibility for monitoring risks at the Perth casino.
“I’m not sure,” he said.
He denied Cahill’s suggestion that the Burswood board “effectively abrogated” its responsibilities for oversight of risk in favour of Crown Perth’s management, saying: “I don’t believe so.”
Asked by Cahill about Crown’s corporate culture in regards to a bank account held by subsidiary Riverbank Investments that both the NSW and Victorian inquiries have found was used for money laundering, Packer said the company was named employer of the year by the WA government in 2015.
“So the culture, I believed, was a culture where we were achieving good things,” he said. “I think at some point, the culture slipped.”
Cahill asked if Packer accepted “at least partial responsibility for that because of your absence”.
“Potentially,” Packer said.
He said he did not believe that Crown Perth was engaged in money laundering.
He also said he disagreed with a finding by the NSW inquiry that management was beholden to CPH, both while Packer was on the board and afterwards.
The inquiries in NSW and Victoria both found Crown was not suitable to hold a casino license but stopped short of recommending it be stripped from the company.
Instead, in both states the company has been offered a chance to reform itself.
The Perth hearings continue.