Monday 6 March 2017

Melbourne and Perth’s Crown Casinos have effectively closed following the government’s announcements of a lockdown on non-essential services. Scott Morrison on Sunday night said all cafes, restaurants, bars, clubs, casinos, gyms and places of worship were to close in response to the coronavirus crisis. Discover the best events and find out what's on at Crown Perth. Explore things to do and view our live entertainment schedule.

Crown Confidential: Packer's Losing Hand

James Packer and his Crown gambling and entertainment empire have bet big, for more than a decade on China, and its VIP gamblers. These high rollers have fuelled Crown's booming businesses in Asia and Australia.

'Ladies and Gentlemen, I have made many, many mistakes in my life, but investing in China is not one of them.'James Packer, March 14, 2013

But one night in October last year, all that was turned on its head.

'They said it felt like they were suspects of a murder investigation or a drug bust. That was just how sudden and forceful the raids were.'Reporter

Fifteen Crown employees and a number of associates were swept into custody in a carefully co-ordinated series of raids across four cities in China.

'If you are referring to the Australian nationals who were detained by Chinese authorities a few days ago on suspicion of gambling activities... gambling is illegal in China.'China's Foreign Ministry Spokesperson

Crown's operations had run headlong into China's biggest ever corruption crackdown, leaving its business model in disarray.

'This was a shot across the bows by the Chinese Government... of Crown, but it was a general warning to everybody else who was thinking about sending people to China to recruit Chinese high rollers to gamble in their casinos.'Former Hong Kong Prosecutor

On Monday night Four Corners investigates what went wrong for Crown in China.

Reporter Marian Wilkinson pieces together the key characters and events in the lead up to the arrests.

'There was a certain arrogance... they wouldn't touch us because we are, frankly speaking, we are white guys.'Casino Consultant

And explores what this means for Crown's casino business here in Australia, especially the multi-billion dollar Barangaroo project in Sydney, as the bottom falls out of their Chinese high roller market.

'If you've been going to Crown and you are phoned up by the local police and questioned on your movements and your past history of travel to Australia, you would be close to borderline suicidal if you were to make another trip to Australia. It's like putting big 'X' across your forehead.'Casino Consultant

Crown Confidential, reported by Marian Wilkinson and presented by Sarah Ferguson, goes to air on Monday 6th March at 8.30pm EDT. It is replayed on Tuesday 7th March at 10.00am and Wednesday 8th at 11pm. It can also be seen on ABC News 24 on Saturday at 8.00pm AEST, ABC iview and at abc.net.au/4corners.

Background Information

PAPERS AND REPORTS

Rescuing Autocracy from Itself: China's Anti-Corruption Campaign University of California, Berkeley 7 Sep 2016 - Study on the corruption crackdown by Chinese President Xi Jinping, by Xi Lu and Peter Lorentzen. https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2835841

Triad Organized Crime in Macau Casinos: Extra-Legal Governance and Entrepreneurship British Journal of Criminology 8 Feb 2016 - The Chinese criminal underworld is evolving along two paths: structural and territorial-based triads and criminal groups formed by entrepreneurs. The present study used triad involvement in casino VIP rooms to examine how these two paths cross after China resumed sovereignty of Macau in 1999. Read the study, by Dr Sharon Kwok and Professor Lo of Hong Kong City University. https://academic.oup.com/bjc/article-abstract/doi/10.1093/bjc/azw014/2623919/Triad-Organized-Crime-in-Macau-Casinos-Extra-Legal

RELATED NEWS COVERAGE

Life inside a Shanghai detention centre: Former detainee offers insight to Crown staff - by Four Corners ABC News 6 Mar 2017 - Peter Humphrey is a British national who was arrested and held in a Shanghai detention centre in 2013. He spoke to Four Corners about his traumatic experience during his two years behind bars. https://www.abc.net.au/news/2017-03-06/former-shanghai-detention-centre-detainee-gives-advice-crown/8328054

Crown's local casino licences under scrutiny if China hands down conviction, former regulator boss warns, by Four Corners ABC News 6 Mar 2017 - https://www.abc.net.au/news/2017-03-06/crown-resorts-local-operations-under-scrutiny-four-corners/8326428

Crown assembles legal war room in act of 'a--- covering' The Age 26 Nov 2016 - http://www.theage.com.au/business/crown-assembles-legal-war-room-in-act-of-a-covering-20161124-gswpdv.html

Crown staff 'formally arrested', face months behind bars SMH 21 Nov 2016 - http://www.smh.com.au/business/crown-resorts-employees-formally-arrested-face-months-behind-bars-20161120-gstlh1.html

Crown's Chinese middleman to VIP high-rollers among those arrested in raids by Philip Wen SMH 7 Nov 2016 - http://www.smh.com.au/business/crowns-chinese-middleman-to-vip-highrollers-among-those-arrested-in-raids-20161103-gsh1aj.html

Four Australians being helped in China, Julie Bishop says SMH 30 Oct 2016 - http://www.smh.com.au/business/crown-arrests-julie-bishop-says-four-australians-receiving-assistance-in-china-20161030-gse0p9.html

Meet 'Mr Chinatown' of Toorak, Crown's biggest whale catcher SMH 29 Oct 2016 - http://www.smh.com.au/business/meet-mr-chinatown-of-toorak-crown-casinos-biggest-whale-catcher-20161027-gscj6d.html

Macau junkets are finally on a roll, but will it last? South China Morning Post 24 Oct 2016 - http://www.scmp.com/week-asia/business/article/2039082/macau-junkets-are-finally-roll-will-it-last

Crown Casino arrests: Jail fears for staff detained in China for alleged gambling crimes ABC News 17 Oct 2016 - https://www.abc.net.au/news/2016-10-17/crown-casino-resorts-staff-in-china-jail-fears/7937608

ANALYSIS James Packer's Crown casino plans for Barangaroo threatened by China arrests, by Ian Verrender ABC News 17 Oct 2016 - https://www.abc.net.au/news/2016-10-17/james-packer-crown-barangaroo-plans-threatened/7938136

Three Australians among 18 Crown Resorts staff held in mainland South China Morning Post 16 Oct 2016 - http://www.scmp.com/news/china/article/2028434/three-australians-among-18-crown-resorts-staff-held-mainland

Here's how the real high-rolling VIPs gamble Business Insider 16 Sep 2015 - http://www.businessinsider.com.au/how-high-rollers-vips-gamble-casinsos-2015-9

British Investigator Hired by Glaxo Is Freed From China Prison NYT 9 Jun 2015 - https://www.nytimes.com/2015/06/10/business/international/british-investigator-peter-humphrey-is-released-from-chinese-prison.html

WATCH RELATED 4 CORNERS

High Rollers - High Risk? 15th September 2014 - Linton Besser investigates the drive to entice foreign gamblers to Australia and the implications of that strategy. Watch Online

Will the Son Also Rise 12 Oct 2009 - The story of James Packer, his attempt to create a global gaming empire and the business gambles that cost him billions. Watch Online

60 Minutes has revealed the secret inner workings of Australia’s biggest casino, its ties to Chinese crime bosses and communist party figures, drug syndicates, money laundering and alleged sex trafficking rings. CREDIT: 60 Minutes

The 60 Minutes team. Picture: Channel 9Source:Channel 9

Channel 9 had built it up as a story that would “rock the foundations of Australia”, but a 60 Minutes investigation into Crown casinos left many viewers unimpressed.

The year-long investigation looked at tens of thousands of leaked emails which show the secret inner workings of Australia’s biggest casino.

The Sunday night current affairs show claims these emails show Crown’s links to Chinese crime bosses and communist party figures, drug syndicates, money laundering and alleged sex trafficking rings.

In a promo released a few days ago, 60 Minutes said the episode would feature “a story so important it can’t be missed”, which was “set to rock the foundations of Australia”.

The show came about as a result as a major investigation into Crown casinos. Picture: Channel 9Source:Supplied

However, from the get-go it was clear that many viewers felt let down — saying they felt the episode had been massively over-hyped.

Others pointed out that ABC’s Four Cornersran a similar story in 2017 called “Crown Confidential” which included allegations that Crown had “developed a business model based on luring rich Chinese, known as VIP high rollers, to its casinos … in a country where gambling and promoting gambling are illegal”.

The #Ashes promo has been the most exciting part of this earth shattering #60mins story.

— Megan Hustwaite (@MeganHustwaite) July 28, 2019

But The Age journalist behind the story, Nick McKenzie, defended the 60 Minutes exclusive, calling on viewers to judge the story not the promo.

Gay, Mike- I hope you judge the show on its merits, not on the promo!! I reckon you might be surprised at what else we’ve found.

— Nick McKenzie (@Ageinvestigates) July 27, 2019

Others came to the show’s defence, saying it exposed an obscene level of corporate greed in Australia and posed serious questions for the Federal government — particularly given it claimed the Australian Consulate was helping Crown by handing out hundreds of visas to dubious gamblers.

Sacked Border Force Commissioner, Roman Quaedvlieg, even claimed he was encouraged by ministers to help fast-track Crown’s Chinese high rollers through Australia’s borders.

Public interest #journalism bravo @Ageinvestigates we need more of this reporting. Revelations which surely must lead to action by regulators and governments. #60minuteshttps://t.co/aPIAGi1fDg

— Jules Hope (@HopeJules) July 28, 2019

Dirty money, dirty politics - no excuses anymore - we need a National ICAC and we need it now! #60Minutes Thanks @quaedvliegs for keeping the bastards honest as usual! https://t.co/xTKpCSEjeN

— Jacqui Lambie (@JacquiLambie) July 28, 2019

WHAT DID 60 MINUTES UNCOVER?

The investigation by The Age, The Sydney Morning Herald and 60 Minutes, aided by one of the biggest leaks of corporate data in Australia, showed how Crown helped bring criminals into Australia — raising “serious national security concerns”.

One of the journalists who worked on the story, Nick McKenzie, said the emails showed a “lust for profits-proven arrogant culture where almost anything, including courting people with ties to the criminal underworld was not only allowed but encouraged”.

The story alleges that Crown broke Chinese law by promoting gambling and paying Chinese sales staff bonuses to lure big gamblers Down Under.

60 Minutes followed a former employee of Crown Resorts, Jenny Jiang, who spent four weeks in a Chinese prison with drug dealers, pickpockets and prostitutes after she was arrested in October 14, 2016.

Former Crown employer Jenny Jiang spent four weeks in a Chinese prison. Picture: Channel 9Source:Supplied

She was arrested in 2016. Picture: Channel 9Source:Supplied

She was one of 19 Crown staff, including three Australians, who were held in custody and convicted of breaching Chinese laws that ban gambling and its promotion.

These laws include the luring of groups of high-rollers to offshore casinos, which she said she was helping facilitate in her role with Crown.

She also claimed Australian consulate offices in China were helping Crown get fast-tracked visas and she was offered a $60,000 payment offer from Crown to keep quiet about its overseas activities.

Sacked Border Force Commissioner, Roman Quaedvlieg, also appeared on 60 Minutes and said he knew how well-connected Crown was to the Federal Government.

He said he was encouraged by several members of parliament, including two ministers, to help fast-track Crown’s Chinese high rollers through Australia’s borders.

Roman Quaedvlieg said Crown is well-connected within the Federal Government. Picture: AAP Image/Mick TsikasSource:AAP

“I spoke to a sitting member of parliament in addition to two ministers … indicating that Crown, and subsequently the junket operators that worked with Crown, weren’t receiving a facilitated service for private jets coming into Australia, into Perth and Melbourne, and were seeking some arrangements which smoothed out the processes there a little,” Mr Quaedvlieg said.

“It’s very clear that there was a powerful constituency behind the entreaty.”

In a statement to The Age, Crown Resorts denied any breach of Chinese law and added it had not been charged with an offence in China.

James Packer, who was not a Crown executive or director at the time and who sold half his stake in the company for $1.76 billion earlier this year, “adamantly” denied knowledge of Crown’s activities in China with his lawyer telling The Age the businessman had a “passive role” in events.

James Packer ‘adamantly’ denied knowledge of Crown’s activities in China. Picture: AAP Image/Tracey NearmySource:AAP

Reporter Allison Langdon concluded 60 Minutes by saying Mr Packer did not want to be interviewed for the story.

Crown Perth Casino

“But he told us he had no knowledge or involvement in the issues we have raised tonight,” she said. “And despite being the major shareholder and public face of the company, he emphasised he was not a director of Crown Resorts at the time its employees were imprisoned in China and hadn’t been for many months before that.”

She added a Crown Resorts spokesperson told them the company does not discuss its relationships with junket operators and other individuals.

Crown Casino Perth Nightclub

“We were also told that even though 19 of its staff pleaded guilty and were convicted and imprisoned in China, Crown didn’t breach Chinese law,” she said. “It seems corporate arrogance has hit a new low.”