It’s a peculiar feeling, but today Crikey finds itself agreeing wholeheartedly with an editorial in the largely forgettable business tabloid The Australian Financial Review.
Usually a stern advocate for the interests of corporations, boards and corporate executives — even at the expense of investors — today the AFR rails against the piss-weak penalty handed out to Star Casino by the NSW gaming regulator after the shocking Bell inquiry into multiple instances of systemic misconduct at the casino.
Star will simply pay a fine and have its casino licence “suspended” while it continues to operate, until it is deemed fit to resume the licence.
That The Star will remain open during the suspension shows the claim that finding new owners would require a shutdown and job losses doesn’t wash. Instead, what has happened again is that the shareholders of a gaming company have been inappropriately shielded from the downside of appalling corporate misconduct at the expense of proper accountability. The lenient treatment for the wrongdoing that has stained Australia’s reputation as a clean place to do business is not good enough.
I can’t believe I’m typing this, but hear, hear.
The NSW Independent Casino Commission argues it’s all about saving the 4000 jobs at Star. Is it serious? Other industries are screaming for workers at a time of record low unemployment, and we’re worried about saving jobs? Ensuring workers can continue employment at a corporation riddled with money laundering, crime and exploitation of problem gamblers is the priority? “Doesn’t wash,” says the AFR. One can only agree.
Star and Crown are two of the most egregious examples of state capture currently on display in corporate Australia. They used political influence and big donations to convince politicians on both sides to neuter gaming regulators, paving the way for links to organised crime, massive money laundering, tax evasion and routine breaches of gaming laws.
Yet even after these crimes have been exposed by the media, leading finally to investigation and condemnation, they have been allowed to continue running casinos.
Both should have been the subject of the corporate equivalent of capital punishment. Instead they’ve continued on, minus a few directors and executives, but otherwise intact — with Crown having found a home in private equity firm Blackstone.
Australia has a serious, systemic problem with soft corruption and state capture by powerful industries. Gambling — and bear in mind, the pokies lobby makes Star and Crown look like bumbling amateurs — is one of the worst, but by no means the only one. The two casino operators were a chance for governments and regulators to send a signal that times had changed, that the old ways of doing business — employ an ex-Labor hack here, a former Liberal minister there, spend a million on donations — were no longer good enough.
It’s an opportunity badly missed by both the NSW and Victorian governments.
