The royal commission into Melbourne’s casino is Victoria’s best chance yet to end the cosy relationship between Crown Resorts and the state’s power elite that has existed for far too long.
Stopping the toxic tango, and working out what to do after the state’s biggest single-site employer was exposed for allegedly facilitating money-laundering and allowing junket operators with organised crime links to run their own gaming rooms, will be a big task.
But former federal court judge Ray Finkelstein has the skills to hold a fast and forensic inquiry. His job as royal commissioner is straightforward – to determine “whether it is in the public interest for Crown Melbourne to continue to hold the casino licence in Victoria”.
Once Finkelstein hands over his report, which could be as soon as August, it will be up to the premier, Daniel Andrews, to implement the changes required to bring the casino back into line.
The premier resisted an inquiry into the operation of Crown even as hearings in New South Wales – where the company hasn’t even started counting out the chips at its glittering new harbourside tower – laid bare the extent of money-laundering and criminal involvement taking place under his nose at the Melbourne casino.
In December, after the hearings of the NSW inquiry had made it clear Crown was in for a caning, but before the commissioner, Patricia Bergin, tabled her report in state parliament, the Andrews government made a gesture towards holding Crown accountable by bringing a regular licence review forward to this year.
The untenability of this position was made clear when Bergin’s 800-page report was released on 9 February. It was underlined last week when Western Australia announced an inquiry with the powers of a royal commission into Crown’s Perth operations.
A look at the Melbourne casino’s history shows why Andrews was slow to act.
From the moment it opened its doors in 1994, the casino’s operators have cosied up to state governments which have seemingly returned the favour in the shape of a do-nothing regulator and sweetheart deals that swelled corporate returns.
Andrews avoided awkward questions about his relationship with Crown and its biggest shareholder, billionaire James Packer, by leaving his somewhat hapless consumer affairs minister, Melissa Horne, to announce the inquiry by herself on Monday.
Crown has insinuated itself into every part of Melbourne society, through well-connected directors such as adman Harold Mitchell and former AFL boss Andrew Demetriou, and by hosting what at times seems like every event in town. From company meetings to conferences to awards nights – including the Quills, Victoria’s biggest journalism gongs.
The Victorian opposition leader, Michael O’Brien, demanded a full-scale inquiry into Crown when Bergin handed down her report and is now doing a victory lap on Twitter. But he too appears to have been one of the company’s bedfellows.
We demanded an inquiry into Crown and our pressure has forced action.
— Michael O'Brien (@michaelobrienmp) February 22, 2021
But Labor’s attempt to make this RC report in just 5 months - when the NSW equivalent had 18 months - isn’t right.
The Crown Royal Commission must have all the time required to establish the truth.#springst pic.twitter.com/1Vay6FhHmt
In 2014, as treasurer in the Coalition government led by Denis Napthine, O’Brien signed a deal with Crown that poured more poker machines and gaming tables into the already crowded casino. It could expose taxpayers to penalty payments of more than $200m if the facility’s license is revoked.
The deal, signed just three months before Napthine’s government was swept away in an Andrews landslide, is one of the factors that will complicate Finkelstein’s job.
But the Fink, as he is known in Melbourne’s legal district, is well-equipped to run an investigation into complicated circumstances.
As a federal judge court he invented and ran a list to fast-track complex commercial cases, dubbed the “rocket docket”, and in his rulings often cut through the cruft of company law to deliver just outcomes.
In 2011, after leaving the bench, he ran an inquiry into the regulation of the media for the then-federal minister for communication, Stephen Conroy, that followed on from the News Corp phone hacking scandal in the UK.
His proposal to set up a statutory “news media council” was opposed by every player in the industry and came to nothing.
Finkelstein also gave advice to Andrews before the 2014 election that contracts to build the Napthine government’s East-West Link, a road project carving through the inner northern suburbs, might not be enforceable.
Andrews subsequently ditched the project and the Victorian government ended up paying compensation to the builders reported to be about $1.1bn.
Some have suggested Finkelstein is too close to Labor. But on the bench, he had a reputation as a straight shooter, and his advice on the road project was never actually tested in court.
Yes, Roman was his birth name.
— Leonie Wood (@WoodLeonie) February 22, 2021
He responds to Judge, Ray and Fink.
He is genuinely one of the most interesting people I have ever known.
One complication he will confront is that O’Brien’s sweetheart deal back in 2014 specifically ruled out revoking Crown’s license because it was no longer in the public interest for the company to hold it.
This means that to make a finding that Crown is unfit to hold the license, Finkelstein would need to delve deeper into his terms of reference and look for breaches of the law and other facts that could render Crown and its associates unsuitable to hold the licence.
However, the Bergin inquiry has already set out a roadmap for investigation of the various allegations against Crown. She also provided a guide for reform to make Crown suitable to hold a license – something Finkelstein would also have to do if he reaches the same conclusion that it currently isn’t.
The future of the Victorian Commission for Gambling and Liquor Regulation, which is nominally the casino regulator but was apparently unable to deal with the money laundering and criminality detailed by Bergin, is technically outside of Finkelstein’s brief.
It is facing a separate review process with a view towards stripping casino control out into a stand-alone authority. But Finkelstein is bound to at least touch on the VCGLR as part of another of his tasks – to consider changes to casino regulation laws in Victoria.
Also in his favour is that Crown and its executive chair, Helen Coonan, appear to understand that the decades-long dance that the company has enjoyed with compliant state governments has finally come to an end.
Mitchell and Demetriou have been forced out of Crown along with chief executive Ken Barton and two directors who served as Packer nominees – Guy Jalland and Michael Johnston.
