Economy

Crown Resorts Hit With Money Laundering Class-Action Suit

Crown Resorts Hit With Money Laundering Class-Action Suit”

A fresh class action has been levelled against casino giant Crown Resorts, accusing the company of misleading investors over possible anti-money laundering breaches. Now, law firm Maurice Blackburn claims that the gambling operator misleadingly represented its compliance with legal obligations and did not reveal relevant information from the market in the period from December 2014 until October 2020, when the AUSTRAC probe was unveiled.

When AUSTRAC announced in October 2020 that they had launched an investigation into potential money laundering breaches at Crown Melbourne, the market reacted negatively and over $500 million was wiped out.

Crown Resorts which is the biggest casino operator in Australia has had a awful year in 2020.

Australian financial crime watchdog AUSTRAC uncovered a number of criminal activities related to casino junket operators which are being targeted by organized crime and foreign spies to facilitate dirty cash flows through the casinos, as well as make political donations.

Crown Resorts is also facing allegations that it acted contrary to its investors' interests, so the law firm is to ask the court to consider imposing a share buyback from the affected shareholders.

More news: Peter Nygard arrested, accused of sexual assault, trafficking

This is the second class-action lawsuit against Crown by the same law firm, with the first having been introduced three years ago. This relates to an AU$1.3bn (US$984m) drop in Crown's share price after police in China arrested 19 employees for gambling-related crimes in 2016. The case is set to go to trial in 2022.

Ms Nagy said shareholders would have expected best-practice compliance with anti-money laundering law, especially given Crown's repeated public assertions that it took compliance with the obligation seriously. However, the gaming regulator has prevented Crown from opening out the casino section of the resort due to its many failings.

Crown is now under investigation by the New South Wales (NSW) Independent Liquor and Gaming Authority (ILGA).

On the final day of the Independent Liquor and Gaming Authority inquiry last month, counsel assisting Scott Aspinall said the gaming company's long failure to investigate and admit to claims of money laundering was more concerning than the money laundering itself.

The share price of the Australian gambling giant fell by 8% on October 19th, reducing the operator's market value by $500 million, after Crown Resorts has been accused of misleading investors about the company's compliance with anti-money laundering legislation for nearly six years.



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