Star casino’s former chief executive Matt Bekier’s modest display of remorse and recourse to the legal weasel words “I accept responsibility” failed to shelter him from being fined $700,000 and banned from managing a corporation for six years for his role in the infamous Chinese money-laundering scandal.
Federal Court Justice Michael Lee also banned Star’s former legal chief Paula Martin from managing a corporation for seven years and fined her $400,000. He also ordered the pair jointly fund 45 per cent of the Australian Securities and Investments Commissions’ legal costs.
Lee said he was not convinced Bekier and Martin had insight into their wrongdoing when providing evidence earlier. “It is one thing to regret the consequences of having been investigated and sued,” he said. “It’s another to demonstrate an appreciation of why the conduct found by the court involves serious failures in the discharge of duties owed by senior officers of a casino operator.”
The pair got off easier than would have been expected.
The corporate watchdog can be blamed for that. ASIC walked away from a legal showdown with the former board and instead accepted the scalps of two lesser Star executives.
In his judgment, Lee criticised ASIC’s action, saying he would have imposed different penalties on Bekier and Martin except for the corporate watchdog’s leniency in reaching “objectively generous” deals with the two other executives.
ASIC claimed the Star’s board had breached their duties by paying insufficient attention to the risks of money laundering and criminal links that ultimately led the company to the verge of collapse.
Lee had previously dismissed the allegation, but his judgment on Wednesday offered a withering assessment of the board. “As I observed in the judgment, what was striking was not merely the foreseeability of risks at different points of time, but the failure of all directors, save in one limited respect, to pursue lines of inquiry with the rigor one might expect of those prepared to accept office as a director for a corporation conducting a business pregnant with inherent and obvious risks,” Lee said. “It’s therefore important not to misunderstand the effect of the dismissal of ASIC’s claim against non-executive directors.”
The Star Entertainment Group is having trouble keeping its head above water in Sydney, and a large cloud hangs over the future of its Brisbane casino operation.
There have been many inquiries, including a 2021 damning investigation by the Herald that revealed Crown Resorts had used a Macau junket operator, Suncity, with links to organised crime – and threats to close gaming establishments in Sydney and Melbourne.
Star directors escaped liability because the board was badly misled by management, and they were kept in the dark about the threat presented by criminals operating inside the casino giant.
Company officers have been brought to book for their flagrant breaches. As Lee noted, it should have been worse for them – but the massive fines and corporate banishment shows the system is working, and the major players may not be so lucky next time.
Jordan Baker sends an exclusive newsletter to subscribers each week. Sign up to receive her Note from the Editor.
The Herald’s View – Since the Herald was first published in 1831, the editorial team has believed it important to express a considered view on the issues of the day for readers, always putting the public interest first.From our partners
About the Author
