Crown Melbourne Will Retain Its Victorian Casino License

Friday, August 3rd, 2018 | Written by April Bergman
Crown Melbourne Will Retain Its Victorian Casino License

Crown Resorts will keep its casino license for the Crown Melbourne, after publication of the Victorian Commission for Gambling and Liquor Regulation (VCGLR)’s report on the casino’s operation. Crown Melbourne is Australia’s largest casino, but the operation has been under scrutiny from anti-gambling MP Andrew Wilkie.

The Victorian Commission for Gambling made 20 recommendations for improvements to the Crown Melbourne’s operations. The areas for improvement include the promotion of responsible gaming and institutional governance. The casino’s organization approach to regulation came under criticism, as well.

One key recommendation was for Crown Resorts to use analytics to detect problem gamblers and mitigate the damage done by their compulsive behavior.

In recent months, Crown Melbourne has been accused of allowing visitors to engage in family violence and self-harm while at the resort, so the Victorian Commission gave suggestions for the casino’s management to be more vigilant and responsive to such situations in the future.

Victoria Commission’s Recommendations

The report said Crown’s independent directors need to be more fully engaged in “strategic oversight” of the Crown Melbourne operation. The report also called for better “reporting and decision-making relationships” between the Crown board of directors and the various oversight committees which direct the Crown Melcourne. Documentation between the two sides were sparse, according to the probe.

Tasmanian MP Andrew Wilkie, a longtime critic of Australia’s rampant gambling culture, brought whistle-blower statements to the Aussie public. Wilkie’s witnesses, who once worked at the Crown Melbourne, complained that the management tampered with poker machines (slot machines) that violated player rights. In some cases, “slot picks” were alleged to have been given to high rollers to help them overcome gambling protections built into the pokies.

Use of Poker Machine Blanking Plates

The Victoria Commission’s report found that Crown used “blanking plates” on 17 of its poker machines during a trial period at a point in 2017. The blanking plates meant players had only minimum and maximum betting options, a process which would force players to make larger bets in order to have access to top jackpots.

Crown Melbourne admitted to use the blanking plates, but claimed they were part of a trial period they were running. Crown also stated it did not know it was supposed to inform Victorian regulators of such test runs — a contention Andrew Wilkie and his supporters find hard to believe.

Victoria said that its investigation showed the incidents, but the blanking plates did not change the rate of return on the pokies. For failure to inform the commission of its trial periods, though, the commission fined Crown Resorts A$300,000.

Andrew Wilkie’s Tampering Charges

Andrew Wilkie still claims that Crown Melbourne lowered the expected return on software, so the machines paid back less than the 87% mandated by Victoria’s regulations. States maintain regulatory standards on the payout percentage gaming machines can maintain. While such standards do not assure wins or losses, they do maintain that a probability house edge does not go above 13%. Gaming machine percentages are not supposed to be altered for a set period before or after a player makes a wager on that machine.

The VCGLR report dismissed several of Andrew Wilkie’s allegations. The commission claimed the tampering charges were without merit. In its report, the commission said it continues to investigate the Chinese advertising scandal which caused 16 Crown employees in Shanghai to be arrested by Chinese authorities. The Chinese ad scandal caused Crown to sell most of its assets in Melco Crown, which since has changed its name to Melco Resorts & Entertainment.

Potential Loss of Crown Melbourne License

Had Crown Melbourne been stripped of its casino license, it would have been a financial disaster for Crown Resorts Limited. The casino currently is the major revenue source for Australia’s largest casino company, after its withdrawal from the Macau casino industry. Crown continues to develop the Crown Barangaroo in Sydney Harbour, but that casino will cater to high rollers only.