It was widely known at senior levels of The Star casino that cash transactions were occurring in a junket room where that was prohibited because of the risk of money laundering, an inquiry has heard.
The Independent Liquor and Gaming Authority is looking into The Star Entertainment Group's suitability of to run its Sydney casino.
There's been evidence a Macau-based junket operator, Suncity, was breaching the rules of its agreement by carrying out cash transactions in a high-roller room, Salon 95 at The Star Sydney, which it was using exclusively.
CCTV footage from 2018 played to the inquiry showed Suncity staff fetching sports bags from the salon's balcony, bringing them into the service desk and unpacking bundles of $50 notes.
In one instance the footage showed them giving a brown paper bag to a gambler for a huge amount of money he'd cashed out.
More vision played on Friday from April 21, 2018 showed similar activity — a man passing a white plastic bag through the side door of the service desk, and cash then being taken out of it.
The agreement between The Star and Suncity prohibited the junket operator from carrying out cash transactions because of the high risk of money laundering and the difficulty finding the source of funds gambled in Salon 95.
"Should a white bag of cash be provided through the side door in the service desk," asked counsel assisting Nicholas Condylis.
"No," The Star's Group Compliance Manager Graeme Stevens replied.
Under questioning by Commissioner Adam Bell SC, Mr Stevens admitted it was widely known at The Star that cash transactions were happening in the salon.
"There were many other people other than yourself that understood there were cash transactions occurring at Salon 95?," Commissioner Adam Bell SC asked.
"Correct," Mr Stevens answered.
"Including senior management," Mr Bell said.
"Yes," Mr Stevens said.
"Up to what levels of senior management to your understanding," Mr Bell said.
"At least general counsel if not above," Mr Stevens replied.
An internal investigation was carried out into the cash transactions, but The Star only issued a warning letter to Suncity.
Mr Stevens said the relationship "probably" should have been terminated at that stage.
He was responsible for liaising with the gaming regulator at the time and admitted he should have passed the warning letter onto the authority.
"Perhaps the regulator should have been informed," Mr Stevens told the inquiry.
"It's extremely regrettable the regulator was not informed at that time," Mr Condylis added.
"I agree," Mr Stevens said.
The inquiry continues.
