Crown Resorts CEO Under Investigation On Eve Of Suitability Report

December 13, 2023
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Crown Resorts CEO Ciarán Carruthers is under investigation by a board-appointed law firm over possible compliance breaches at Crown Melbourne, just one month before the casino’s government overseer releases a report crucial to its survival.
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Crown Resorts CEO Ciarán Carruthers is under investigation by a board-appointed law firm over possible compliance breaches at Crown Melbourne, just one month before the casino’s government overseer releases a report crucial to its survival.

The law firm is probing allegations that Carruthers overruled security protocols by disregarding a one-year ban on a patron who brought a child into a casino, the Australian Financial Review reported on Tuesday (December 12).

On another occasion Carruthers allegedly allowed a drunk gambler to stay in the property after security ordered the patron to leave, the report said.

The Crown Resorts board recently launched the probe into Carruthers, it said.

Carruthers was hired by US-based parent company Blackstone Group from Wynn Macau in 2022 to right the ship at Crown after years of regulatory scandal, revenue shocks and board turbulence, and to prepare for a 2024 suitability deadline.

The special manager’s final report into the casino’s progress, which is due mid-January, will likely weigh heavily on the Victorian Gambling and Casino Control Commission’s (VGCCC) decision by mid-April 2024 to restore the company’s licence or end its tenure as a casino operator in Victoria state.

A spokesperson for the Office of the Special Manager for the Melbourne Casino Operator (OSM) confirmed the existence of the probe in an emailed statement to Vixio GamblingCompliance.

“The OSM is aware of Crown’s investigation into allegations concerning the Crown Resorts CEO,” she said on Wednesday.

“The OSM is monitoring this matter as part of the Special Manager’s independent oversight of Crown’s Melbourne casino, and will liaise with the Victorian Gambling and Casino Control Commission as appropriate.”

The spokesperson did not answer a Vixio question on whether there will be enough time for the probe and its outcome to be addressed in special manager Stephen O’Bryan’s final report.

In a poor development for the company and Carruthers, Melbourne’s The Age newspaper reported on Wednesday that a number of Crown security personnel signed a petition demanding an apology from Carruthers for alleged behaviour that forced them to “break the law”.

The Age also cited unnamed union sources as saying that two meetings between Carruthers and the officers had been cancelled.

“We were made to feel under-appreciated and blamed for the situation Crown is in,” the petition was quoted as saying.

“Our own people were made to feel insignificant, snubbed [and] scared for their jobs,” it said.

Crown Resorts has suffered severe penalties during its remedial phase of provisional licensing and government oversight, including a A$450m ($295m) fine from the federal government’s transactions watchdog AUSTRAC last May, as well as a total A$230m in Victorian regulator fines as of last April.

But these fines related to misconduct under previous management when the company was formally or beneficially controlled by ex-gaming mogul James Packer, and the VGCCC has made it clear that Crown’s conduct since then has been encouraging.

The regulator’s CEO, Annette Kimmitt, told a conference in Sydney in March this year that Crown and Blackstone were “running really hard at doing everything they can to return to suitability”.

The new allegations against Carruthers may have broken this vital streak of cautious approval, with the VGCCC telling The Age on Wednesday that it is also “actively investigating”.

If corroborated, the allegations would also be perilous for Crown in New South Wales and Western Australia states, where its casinos have come under extreme scrutiny and continue to suffer licensing obstacles.

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