Investors in the Star Entertainment Group are being encouraged to register their interest in a potential class action against the company after it failed to inform the market of money laundering, organised crime and fraud allegations.
Earlier this month, The Age, The Sydney Morning Herald and 60 Minutes revealed The Star Entertainment Group was warned in 2018 that its efforts to prevent money laundering, terrorism finance and corruption in its casinos were inadequate.
A report prepared by leading consultancy firm KPMG found the company had no documented risk assessment process for Chinese high-roller tour groups, understated the risk of money laundering among gamblers, and did not consider terrorism financing as required by the Anti-Money Laundering and Counter Terrorism Financing Act 2006.
The report was never disclosed to the Australian Stock Exchange. After it was revealed by the media, the Star Entertainment Group’s share price fell by 23 per cent, wiping an estimated $1 billion off its market value.
Class Actions Practice Leader Rebecca Jancauskas said Shine Lawyers is investigating whether the company engaged in misleading and deceptive conduct, breached its continuous disclosure obligations, and conducted its business in conflict with the interest of shareholders.
“This explosive report by KPMG should have been immediately disclosed to the market given the seriousness of the allegations against the Star Entertainment Group,” she said.
“The company’s alleged attempts to cover up this scandal blew up in its face and investors deserve to be compensated for the financial loss they have suffered.”
Ms Jancauskas said the Star Entertainment Group has had years to clean up its act.
“The company says it has implemented the recommendations of the KPMG report but police in New South Wales recently alleged a suspected drug trafficker was until this year laundering money through its Sydney casino,” Ms Jancauskas said.
“Star casino’s high roller gaming manager is also reported to have maintained a relationship with accused corporate criminal Michael Gu who allegedly punted millions of dollars at the venue between 2018 and 2020,” she said.
“The Star Entertainment Group’s reputation as a supposed cleanskin of the gambling industry is in tatters and I suspect shareholders will be horrified by the evidence revealed at what looks likely to be a public inquiry in New South Wales.”
Queensland’s Attorney-General Shannon Fentiman last week announced allegations concerning the company’s casinos in Brisbane and the Gold Coast are being investigated by the state’s Office of Liquor and Gaming Regulation, the police, and Austrac.
Anyone who purchased or owned shares between 12 October 2015 and 11 October 2021 should contact Shine Lawyers on 1800 325 172.
Read more about the potential Star Entertainment Group Class Action here.