From international criminal syndicates to casino executives turning a blind eye, plenty of reports in the past year have explained why Crown's Australian casinos have been hotbeds of suspected money laundering and criminal infiltration.
The Perth Casino Royal Commission (PCRC) final report, released on Thursday, comprising almost 1,000 pages, outlines the shortcomings of many parties in acting on red flags indicating potential money laundering, as far back as 2014.
But the findings also pointed the finger of responsibility at some targets with a less racy reputation: the WA government and its casino watchdog.
The report – by commissioners Neville Owen, Lindy Jenkins and Colin Murphy – details many failings of the Department of Local Government, Sport and Culture Industries (DGLGSC) and the Gaming and Wagering Commission (GWC), failings that in turn allowed alleged money laundering to continue without question.
It found these bodies should shoulder some responsibility, as they operated with the incorrect belief that they were not responsible for regulating the risks of money laundering at the state's monopoly casino.
"The PCRC concludes that these failings of the GWC and the Department are likely to have been a contributing factor to the occurrence of apparent money laundering through the ANZ Riverbank accounts between 2013 and 2014 and the CBA Riverbank accounts between 2014 and 2019," it said.
The Bergin inquiry in New South Wales found that hundreds of millions of dollars were likely to have been laundered through the Riverbank account, controlled by Crown Perth, by international crime syndicates.
Many of the regulatory failings outlined in the WA report focus on former racing and gaming bureaucrat Barry Sargeant and former chief casino officer Michael Connolly.
They are also at the centre of many royal commission findings of where failures to prevent regulatory capture had led to bad decision making and compromised the independence of the GWC.
A bottle of bubbles and independence
Regulatory capture describes a situation when regulators act, or appear to act, in the interests of the business they regulate and not in the public interest.
The royal commissioners have recommended that the GWC develop formal guidance on how they will handle the risks of regulatory capture.
In one case study featured, Mr Sargeant, who was also the chair of the GWC, would pay for his executives to have a Christmas meal at Crown Perth between 2010 and 2013.
They would be seated in a "private alcove", with visits from then-Crown Perth chief executive Barry Felstead.
"Sargeant gave evidence that at the lunch at the Atrium in December 2013, Crown provided a complimentary bottle of sparkling wine," the report said.
The royal commission found that in being involved in these events, both the department and the casino had not reasonably managed the risk of regulatory capture and compromised the actual and perceived independence of the regulator, as well as its effectiveness.
Emails about fishing trips cited
Another case study cited was the emails about boating and fishing sent by Mr Connolly to Crown executives when he was liaising with them about proposed changes to an electronic gaming machine (EGM) speed of play.
These included Mr Connolly's friends Paul Hulme and Claude Marais, who were part of the Crown Perth team that would request amendments from the department and Mr Connolly.
The report said that any relaxation of regulation, such as speed of EGMs, would be initiated by Crown Perth.
Again, the royal commission found both the regulator and the regulated had failed to conduct themselves professionally and failed to try to reduce the risks of regulatory capture.
It said Mr Sargeant was wrong in deciding Mr Connolly's friendship and fishing trips with Mr Marais were not a conflict of interest that needed to be managed, and he should have told the GWC about it.
But the royal commission did not conclude Mr Connolly favoured Perth Casino because of his social relationships.
"Nevertheless, in respect of a number of recommendations made by Connolly to the GWC, there was a potential for his personal relationships to affect the recommendations," it said.
"There remains a potential that they did so."
A trip to Macau
Another example cited in the report was a 2013 trip to Macau by Mr Sargeant at the invitation of Mr Felstead, who said he wanted to show him "the challenges" in getting international VIP gamblers to visit Crown Perth.
The trip was approved by WA's minister for racing and gaming at the time.
The company paid for Mr Sargeant's travel, accommodation and meals, including at the Jade Dragon and Ying restaurants, as well as a ticket to the House of Dancing Water Show at the City of Dreams resort.
But according to a witness statement to the commission included in the report, Mr Sargeant said he felt obliged to accept the theatre tickets.
"… it is certainly not the case, that a gratuitous stage show would carry any favour with me," he said.
"I did however feel some discomfort at attending this stage show, which I believed was compliments of the City of Dreams resort, and I therefore left an amount of my own money (I believe it was HKD 1000) with one of the resort staff to donate to a local charity in lieu of payment for my ticket."
Under the policy Mr Sargeant oversaw at the department, he was not allowed to accept any gifts or hospitality from a company his department regulated.
The report outlines how Mr Sargeant requested his official itinerary be changed to delete the names of the restaurants and dancing water show.
"The 'two small changes' to Sargeant's itinerary had the result that the receipt of those gifts of hospitality were concealed," it said.
"The PCRC concludes that Sargeant knowingly acted contrary to the Department's Gifts and Hospitality Policy by accepting those gifts or hospitality."
The royal commission found Mr Sargeant, who was appointed to the Salaries and Allowances Tribunal by Premier Mark McGowan in 2018, risked both the actual or perceived independence of the GWC and the department.
Blind eye to junkets, money laundering
It also highlighted occasions when Mr Connolly and Mr Sargeant's advice to the GWC about suspected money laundering and criminal infiltration at Crown Perth was deficient, meaning this alleged activity was allowed to continue without investigation.
For example, in July 2019 media stories alleged that Crown had turned a blind eye to junkets with organised crime links which were laundering money through its Perth and Melbourne casinos.
"The seven junkets (or their operators) the subject of the 2019 Junket Media Allegations were at various times approved to operate at Perth Casino," the report said.
After the media stories, the Department of Premier and Cabinet contacted Mr Connolly, requesting information for a briefing note for the Premier's office.
Mr Connolly emailed his then-director general, Duncan Ord, to outline WA's approach to regulating junkets, concluding with this comment:
"Unfortunately the story seems to be making the most out of the bleeding obvious, that Crown were/are trying to attract high net worth individuals to their properties in Australia," he wrote.
The allegations in these stories led to the establishment of the Bergin inquiry in New South Wales in August 2019, which found that international criminal syndicates were likely to be laundering hundreds of millions of dollars through Crown-held bank accounts at the two casinos.
Mr Connolly told the DPC: "It's important to note that we are yet to establish that Crown have done anything wrong."
He also told the GWC that Border Force was responsible for probity checks on suspicious individuals and AUSTRAC to monitor potential money laundering, and they should wait for the outcomes of investigations in other states.
The royal commission report was critical of Mr Connolly's communications with Mr Ord and the GWC because he did not disclose his knowledge of key information, such as WA had the weakest regulation of junkets in Australia and reliance on AUSTRAC and Border Force was misplaced.
Mr Connolly is still an employee of the department but is on leave.
DLGSC Director-General Lanie Chopping said her department had already addressed some of the issues raised in the report, including the services it provided for the GWC.
"Where there are any adverse findings in relation to existing staff of the DLGSC, thorough investigations will be undertaken," she said.
