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Australian casino operator The Star Entertainment Group’s year of woe has taken another turn for the worse after a top Queensland state official flagged a fresh probity investigation over a media report linking partner company Chow Tai Fook to organised crime.
State attorney general Shannon Fentiman told the Australian Broadcasting Corporation (ABC) today (August 22) that a report by ABC journalists on connections between the jewellery and property giant and gangsters such as Macau’s “Broken Tooth” Wan Kuok-koi justifies scrutiny of the Hong Kong-based giant.
Chow Tai Fook, along with Chinese-controlled Far East Consortium, is a partner with Star Entertainment in developing the Queen’s Wharf integrated resort on prime riverside land in central Brisbane.
“Look, it's incredibly concerning to me as the minister, and I think any of this new information that comes to light will absolutely be investigated,” Fentiman told the ABC, pointing to Queensland’s Office of Liquor and Gaming Regulation (OLGR).
Such action would be in addition to the Gotterson inquiry, named for Queen’s Counsel Robert Gotterson, an external public inquiry commissioned by the government into Star’s Queensland operations. Its hearings start in earnest tomorrow (August 23).
“[I expect the inquiry will] thoroughly go through all the operations of [Star’s] casinos here in Queensland, but also their close associates, such as Chow Tai Fook,” Fentiman said.
The attorney general added, however, that the original OLGR due diligence checks on Chow Tai Fook in 2014 involved research in Macau and close work with police in Queensland, New South Wales state and Hong Kong, as well as with “other international regulators”.
She said she was advised that the OLGR’s work was “extensive” and that Chow Tai Fook was considered to be a suitable person in casino operations.
The ABC report has also elicited concern from other government officials, including former auditor-general Len Scanlan, who said the ABC’s findings were “news to me” and that he would not approve Chow Tai Fook’s involvement today if its alleged criminal associates were known to him.
Former Queensland Premier Campbell Newman, who gave the green light to the Queen’s Wharf proposal, said the “revelations … are appalling”, adding that he would release Cabinet documents to the Gotterson inquiry.
The ABC’s “revelations”, however, appear thin compared with those of rival media outlets that rocked Star Entertainment in Sydney and Crown Resorts in Sydney and Melbourne and helped to clean out both companies’ boards and senior management.
Most of the allegations involve evidence of association between late Chow Tai Fook mogul Cheng Yu Tong and Macau gambling identities such as Stanley Ho, or offshore deals between the company and Alvin Chau prior to the latter’s arrest in Macau in November for gambling offences.
Such connections have been known for decades and are charted in the public domain, including Hong Kong Stock Exchange ownership data and corporate filings.
The ABC report also places more responsibility at the feet of the Cheng family for junket and VIP room activity in Macau than the historical record would justify, apparently on the basis of the Chengs’ long-term investment in SJM Holdings parent company STDM.
The ABC report also relies on foreign intelligence reports dating back to 2009 in New Jersey and the 1990s in Canada to back its claims, but pointedly states it makes no allegation of wrongdoing against Cheng or his son and current company boss Henry Cheng.
In addition, Queensland regulatory authorities have long been aware of problems associated with Star’s Chinese partners, with then OLGR executive director Michael Sarquis telling VIXIO GamblingCompliance in 2018 that “there are issues that we are grappling with now that probably in hindsight we should have dealt with before contract closure”.
The ABC report also makes no mention of Chow Tai Fook and Far East Consortium’s weaponising of ties to the Chinese government to clinch deals and exert corporate influence.
Chow Tai Fook, for example, took over the ill-fated Baha Mar casino in the Bahamas with state backing, while Far East Consortium’s chairman warned Australian businesses in 2017 to stay on the good side of Beijing or suffer consequences.
Still, the damage to Star Entertainment in Queensland amid an extended period of national sensitivity to gambling industry misconduct could be far-reaching.
The ABC’s written report will be supplemented by a report on the flagship 7:30 current affairs programme on ABC television tonight.
