Australian casino operator Crown Resorts today announced that its staff members, who were detained last fall over allegations for gambling-related activities, have been charged with “offenses related to the promotion of gambling”.
The company refused to provide further comments as the matter is now handed to court. The cases of Crown’s employees were handed to the Baoshan District Court and are slated to be heard on June 26. As many as 19 defendants were listed, including the three who had previously been released on bail.
The provision of gambling services and their provision is illegal in China, with Macau being the sole exception. Crown’s staff members were detained last October for allegedly promoting the company’s Australian casinos and enticing potential VIP players. The suspected wrongdoers were formally arrested in November but it took up until now for Chinese judicial authorities to take further actions.
The China arrests hit Crown’s profitability to an extent that required management to embark on a massive overhaul of its operations and reshuffle of key company figures. The profitability issue emerged after the casino operator saw a significant drop in the number of VIP casino players from China. Here it is important to note that Chinese customers are a gambling cohort that is highly valued by Asian-Pacific casinos due to its spending habits.
At the time, Crown Resorts operated casinos in its home country as well as in Macau, where it worked together with fellow casino developer and operator Melco International Development. Following the arrests, the Australian company began reducing its stake in its joint Macau venture – Melco Crown – until it sold it completely to its former partner.
Exiting Macau, Crown abandoned previous plans to split its domestic assets from its international ones. The company announced that it would focus its attention on its domestic business. The company currently operates the Crown Melbourne and Crown Perth casino resorts and is building the A$2-billion Crown Sydney on the city’s waterfront.
The operator has also announced recently that it was selling a Las Vegas Boulevard portion of land it had previously purchased with the intention to build an integrated resort, thus further affirming its plans to scrap international expansion ambitions, at least for now.
It became known earlier this year that James Packer, currently being the largest Crown shareholder with a 48% stake, would return to the company’s board after stepping down from his roles over a year ago. Mr. Packer resumed his Director role to help the operator stabilize its operations after the severe damage it had endured as a result from the China arrests.
