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The Star Entertainment Group’s executive chairman John O’Neill has announced his resignation, along with a slew of directors and senior management, ahead of testimony to an inquiry into serious misconduct at the Australian casino operator.
O’Neill informed a company board meeting on Friday (May 20) that he “felt it was in the company’s best interests” and that “he wasn’t sure he had the support of the [gambling] regulator”, according to testimony by Star director Richard Sheppard on Monday.
Star Entertainment announced O’Neill’s resignation as executive chairman and board member on Friday, with O’Neill confirming during testimony on Monday that he will step down on May 31.
O’Neill, whose testimony was continuing at publication time, said “sufficient stability” in running a live casino business had been achieved since his appointment and that the resignations amounted to a “cathartic moment” and “cleansing” for the company after the gaming operation went “very badly wrong”.
O’Neill has held the executive chairman’s post since April 1, following the resignation of CEO Matt Bekier, the first and primary casualty of the New South Wales (NSW) state Independent Liquor & Gaming Authority (ILGA) review into Star.
The ILGA review is investigating numerous compliance failures, including tolerance of criminal connections and likely money laundering at the former Suncity junket at The Star casino in Sydney, a failure to notify ILGA of matters of concern and the use by high-rollers of strictly non-gaming banking and cash card facilities to purchase millions of dollars in gaming chips.
O’Neill, a famed corporate sporting administrator of football and rugby union, has been chairman of Star since 2012, when it was known as Echo Entertainment.
Star announced on Monday in an Australian Securities Exchange filing that Star director Ben Heap will take over as interim chairman and NSW and Queensland chief casino officer Geoff Hogg will take over as acting CEO.
Naomi Sharp, counsel assisting ILGA’s independent review, noted on Monday that Star counsel had informed the review that five Star senior management who had appeared before the inquiry had also resigned: chief financial crime officer Skye Arnott; group general counsel Andrew Power; group compliance manager Graeme Stevens; regulatory manager for NSW David Aloi; and general manager of social responsibility Micheil Brodie.
“In most cases”, the board had requested these resignations because of independent advice that the individuals had “breached the company’s code of conduct or acted otherwise inappropriately”, Sheppard told the inquiry.
Two weeks ago, non-executive directors Sally Pitkin and Gerard Bradley told the inquiry that they intended to resign, comments that were confirmed by a company ASX filing on May 13.
The series of resignations follows the departures in early May of chief legal and risk officer Paula Martin, chief casino officer Greg Hawkins and CFO Harry Theodore following disastrous appearances before the review.
Theodore may find himself in more trouble, however, after a last-minute witness on Monday disputed Theodore’s evidence relating to communications between Star Entertainment and its main banking partner.
Comments by Andrew Bowen, a former director of the National Australia Bank’s (NAB) institutional banking industrials sector, cast new doubt on the truthfulness of Theodore’s evidence in relation to gaming transactions via non-gaming channels that breached agreement rules with the bank.
O’Neill is the final witness to appear before the review. Adam Bell, who is heading the review, will take submissions from counsel assisting and counsel for Star in June before submitting his report.
