Star ignored reports of brazen junket money trail, court told

Star casino executives had extensive evidence that notorious junket operator Suncity was potentially breaching the casino operator’s licence conditions but signed a fresh agreement with the Chinese group regardless, a Federal Court heard on Tuesday.

Star’s lead investigator Andrew McGregor was the author of the report Operation Money Bags in 2018, which detailed troubling information that came to light during an investigation in April and May that year about Suncity’s Salon 95 – the Chinese group’s private office, which dealt directly with high-rollers but was meant to have a very limited role in handling cash at the casino.

Dr Ruth Higgins, SC, who is acting for the Australian Securities and Investments Commission, told the court of the report’s allegations of illegal activity within the walls of Star’s Sydney casino.

“It appears, from Mr McGregor’s account of relevant CCTV footage, that large amounts of cash were deposited at Salon 95 in a red-coloured suitcase, dropped off at Salon 95 in a black and blue sports bag with a black backpack, deposited at Salon 95 in white and yellow plastic bags, delivered to the service desk in a blue esky bag, and provided to patrons at Salon 95’s service desk in brown paper bags,” Higgins told the court.

She said the purpose of McGregor’s report was apparently to help Star’s lawyers prepare advice for the casino operator’s management about the legal and regulatory obligations implications from his investigation, and “to prepare for any anticipated legal proceedings”.

When these issues did come to light – following reports in The Age and The Sydney Morning Herald – Star lost its licence to run casinos in NSW and Queensland. It faces a fine in the hundreds of millions of dollars for contraventions of Australia’s money-laundering laws.

Higgins told the court that Star executive Greg Hawkins twice warned Suncity that the casino operator would have to end their business partnership if these breaches continued.

Instead, Star signed a fresh agreement with Suncity later that year.