VGCCC hits Crown with AU$20m fine

Crown is in hot water with the Royal Commission which discovered new issues with the Casino Operator and License. According to the regulator, Crown has "improperly" listed tax deductions by factoring the costs of promotional activities as amounts paid out as winnings, the regulator said in an official statement published on its website.

According to the Royal Commission, these tax deductions were deliberately withheld from the Victorian Commission for Gambling and Liquor Regulation, the regulator that existed prior to the establishment Victorian Gambling and Casino Control Commission (VGCCC) which was formed in the wake of the gambling scandal involving Crown.

As a result, the VGCCC has now issued an AU$20m fine to Crown in what the regulator said was a clear message to the license holder. Commenting on the case, VGCCC Chairperson Fran Thorn said criticized the behavior and said that the watchdog would always act appropriately in such cases.

"Crown and other gaming licensees have important obligations to pay gaming taxes to the State. […] The VGCCC will not tolerate this behavior," Thorn explained, arguing that gambling operators must comply with their taxes.

In the course of its investigation, the Royal Commission found a document that was disclosed to the investigators for other reasons. However, the probe discovered inconsistencies with the way the tax deductions were reported and homed in on this instead.

Crown has made no attempt to hide the wrongdoing once confronted with the issue, however. In fact, the company paid AU$61.5m to Victoria, including AU$37.4m in the owed amount and AU$24.1m in due penalty interest. The AU$20m was imposed on top of this obligatory payment and penalty interest.

Overall, since the VGCCC has been installed, Crown has received penalties totaling AU$250m, with four separate fines issued to Crown following discoveries made by the Royal Commission. Previously, Crown Melbourne had to settle with AUSTRAC, the Australian financial watchdog by agreeing to pay AU$450m+, around US$300m at the time of the penalty.

Meanwhile, the VGCCC has been vigilant over the gambling industry in Victoria, ordering Crown Melbourne to also roll out the YourPlay pre-commitment system designed to be implemented with electronic gaming machines and strengthen the overall responsible gambling practices on the casino floor.

Despite the string of regulatory inroads, Crown is still in a good position to regain its reputation and set on a course to profitability. To get there, it would first have to weather some choppier patches.

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