The birth of this star can be traced all the way back to 15 June 1993, when the property known as Sydney Skyline Casino was first approved to be built. Only one year later, in a move steeped in foreshadowing, the Leighton Group was removed as project shareholders due to issuing false paperwork to authorities. On 26 November 1997, Star City Casino would officially open. A few years later, Tabcorp would acquire the casino and act as its operator until the demerger in June 2011 that saw Echo Entertainment Group splitting away from Tabcorp – taking Star City Casino with it.
All figures are in Australian dollars AU$1 = US$0.63 approx at the of writing
Stellar Nebula (1993-2012)
FY2011Revenue: $1.65bnNet profit: $226m
FY2012Revenue: $1.62bnNet profit: $42.2m
“We are excited to see the realisation of one of the most significant tourism investment programs in Australia today,” the Echo Entertainment 2011 Annual Report said, before boasting how the VIP experience would still include “private jet transportation to the most opulent private suites and gaming salons,” while still championing responsible gambling for all. In fact, The Star first piloted Responsible Gambling Awareness Week early on in 2004 to raise awareness – and continued to champion the event each year, at least for a while.
Massive star (2013-2016)
FY2013Revenue: $1.74bnNet profit: $83.5m
FY2016Revenue: $2.36bnNet profit: $194.4m
If responsible gambling was part of this star’s core, it seemed to burn up pretty quickly as the entity expanded into one of Australia’s gambling behemoths. According to The Bell Review, an investigation by the NSW Independent Casino Commission into The Star unveiled criminal activity that can be reliably traced back as far as 2013.
The use of China Union Pay (CUP) debit cards quickly began to snowball into much larger issues but, at this point, they were merely used to circumvent Chinese capital flight laws and get patrons into the casino who otherwise wouldn’t be able to gamble. The method was rather simple: A hotel package at The Star would cost $50,000, which was a $1,000 hotel room and $49,000 reimbursed into the patron’s casino account. When banks and institutions asked The Star if CUP cards were being used for gambling, the responses from the management team were “false, misleading and unethical,” as quoted in the Review. No sources of wealth were conducted on players who gained access via CUP cards. This was also true in the case of an individual player whose total wagering turnover exceeded $2.25bn and lost $57.4m while gambling at The Star. Some customers chose to deposit cash in Macau banks and pick up the chips at the Australian casino, which the banks would list as transactions from “A Star to The Star.” Records would later find that HKD$1.2bn (AU$200m) was moved in cash this way.
2016 would be the year when the operator finally rebranded to The Star, junkets were first flagged as a potential issue at the property and Tom “Mr. Chinatown” Zhou would be placed on the exclusion list. Not everyone made it onto this elusive list, though. One case study found that Matt, who was 15 years old at the time and had multiple sclerosis and cognitive impairment with problem-solving, would still be allowed entry despite technically being barred in 2016. When The Star introduced facial recognition technology to flag people on the exclusion list, the company was asked whether it would introduce carded play, which was more reliable in safeguarding customers who were at risk. The Star simply replied that it was not interested.
Red supergiant (2017-2021)
FY2017Revenue:$2.43bnNet profit: $264.4m
FY2018Revenue: $2.58bnProfit: $148.1m
FY2019Revenue: $2.16bnProfit: $198m
By 2018, The Star claimed that it was still #1 on the Dow Jones Sustainability Index but, for the first time, the annual reports made no mention of the Responsible Gambling weeks the company had been proud of hosting since 2004. By 2021, the Responsible Gambling sections in the Annual Reports were barely even included. But in 2017, 2018 and 2019, the Iek junket was turning over approximately $1.29bn, $2.29bn and $1.27bn respectively at The Star by way of non-negotiable chips...
Junkets would become a key failure for The Star. Examining the case of Suncity, who by September 2017 was The Star’s largest junket customer, churns up additional, flagrantly obvious issues. Suncity had its own room within the casino, called Salon 95, which was adorned with branded ashtrays, tables, pens etc. The room even had its own service desk – although there was an argument about this. The Authorities described it as a service desk, while The Star claimed it was a desk that, sometimes, had cash and chips placed on it, but never for transactional purposes! Unfortunately, we may never know the full extent of how the cash was exchanged in Salon 95, because the junkets knew where the CCTV blind spots were. Filing cabinets, suitcases and even business transactions were conducted in these compliance black holes, but the cameras did catch at least 100,000 being exchanged for plaques and “boxes” of cash coming and going from the room. There was also the issue of a bright red suitcase changing hands, but that’s a story for another day.
Indeed, as of 7 April, it was announced that Bally’s was to take control of The Star in a AU$300m deal. All change – but hope for the future, perhaps
In 2018, the Hong Kong Jockey Club (HKJC) created a report linking the recent Bangladesh Bank cyber heist to Salon 95. Out of the $101m stolen from banks in Bangladesh, around $18m was believed to have found its way to Alvin Chau, the Chairman of Suncity, who also had ties to the 14K Triad. Although the FBI never publicly laid charges against him, Chau had been barred from entering Australia by the Department of Home Affairs. After the management team at The Star contained the HKJC report and prevented it from reaching the Board, the Club went public on a Channel 9 broadcast and explained why Suncity shouldn’t be trusted. However, The Star did not budge. That’s not to say The Star didn’t act at all, though. In lieu of performing a risk assessment, in early September 2019, The Star moved Suncity to a new private gaming salon called “Salon 82,” which was still located within the casino but was more inconspicuous.
When asked why The Star would continue doing business with Suncity at this point, Matt Bekier CEO and Managing Director replied: “Why not?” By this point, the company was also allowing in notorious brothel-owner Simon Pan, who had a lifetime turnover of $52.2m in The Star properties; and Huang Xiangmo, a billionaire real estate developer with alleged ties to the Chinese Communist Party, whose total buy-in at The Star was $1.78bn.
By 2020, major cracks began to show in The Star’s operations. Hwa Ryong Kim was the President of International VIP Sales between 2018 and 2021, but he had been with the company since 2016. Lim has never been formally accused of any misconduct, but as a whistleblower had reported, quite politely, Lim had been “trying to move into the credit and collections area.” Bekier didn’t shy away from this part of business, though, describing the International Rebate Business (IRB) as the “dark art of acquiring customers to convince them to fly long range to gamble in our casinos, and then finding a way to entertain them and then settle and collect the money.” Unfortunately, Lim disappeared in March 2020, along with an alleged amount of $13m of junket funds. Also in 2020, The Star destroyed around $3.7bn in casino chips, but this was done without telling the L&GNSW and with no relevant authorities present. Two months later, in November, the L&GNSW was notified that an executive from The Star had stolen around $685,385 worth of free vouchers. It was later identified that the actual total stolen was closer to $5.15m.
It is also worth noting that, during this time, The Bell Review emphasises that the Board had no idea what the management of The Star was up to ‘when no-one was looking’, a point which is loosely reaffirmed by interviews conducted at the time. “The Board of a company clearly has the responsibility to set the culture of a company”, said Ben Heap, Chairman. “They are the guardians of ethical behaviour. If this is not the responsibility of the Board, then whose responsibility, is it?” Bekier, however, had a different opinion. “I’m in a minority view here, but I think it’s management that sets the culture. The Board checks the management’s implementation of that. But the Board is only there 10 days a year. I’m not sure they can actually influence the culture. It’s management’s decisions and actions that shape the culture. The Board needs to keep an eye on senior management.”
Prior to The Bell Review being published, The Bergin Report hit headlines in 2021 as part of investigations against Crown Resorts. This report explained that Crown was unsuitable to operate a gaming licence due to money laundering failures, use of junkets and links to the 14K Triad group – sound familiar? In response to this, Star Entertainment Group’s Chief Risk and Legal Officer, Paula Martin, told an internal meeting that the “response from Star was ‘junkets are dead’ but this… was a convenient answer. There is some concern around them in NSW, but they relate to particular practices in a particular organisation. Starting point from Bergin is that ‘all junkets are evil’… I think it is correct to say that ‘junkets will be different, and heavily scrutinised’. But not sure that they are dead.”
The Bell Review, which would be published on 31 August 2022, was a full inquiry into The Star’s operations and suitability. It was undertaken by Adam Bell, who was appointed by the NSW Independent Casino Commission, and contains around 900 pages of information and evidence. This report also notes that “the AML/CTF Program (contrary to its name) did not consider counter-terrorism financing at all,” patrons were gambling at The Star for extended periods without intervention and estimates suggest that Australians lost approximately $25bn on legal forms of gambling in 2018–19, the largest per capita losses in the world.
Supernova (2022-2023)
FY2022Revenue: $1.53bnNet profit: -$199m
FY2023Revenue: $1.87bnNet profit: -$2.44bn
The Annual Report for 2022 starts with Heap immediately apologising. “I want to address the underlying issues in detail below, but first want to extend again my unreserved apology to our approximately 73,000 shareholders and 8,000 team members,” he says. “We let you down. As our most valued stakeholders, you deserved better.” Following The Bell Review, The Star was found unsuitable to hold a casino licence and as if by coincidence, the Responsible Gambling section in the Annual Report suddenly took up an entire page once again. In response to what happened at The Star, all of the directors resigned and a new Amendment Act was passed on 11 August 2022, which banned junkets from operating anywhere in Australia. Notably, an employee survey held at this time reported that while many wanted to “do the right thing,” there was a significant “lack of clarity on what ‘the right thing was.”
Between July 2022 and 2023, there were 20 new appointments in Board and managerial positions at The Star, as well as more than 500 employees laid off. Four separation class action lawsuits were also submitted against The Star in the Supreme Court of Victoria, while AUSTRAC started civil penalty proceedings regarding the AML/CFT failures. This would result in record fines of $100m against The Star, as well as several directors hit with fine and banned from managing corporations in the future.
By the 2023 Annual report, the Responsible Gambling section was now a three-page spread, but none of it was revolutionary. The Star was also now on the front lines by itself, as Crown Resorts – the other company embroiled in this scandal – had accepted an $8.9bn takeover offer from Blackstone and was delisted from the Australian Securities Exchange. Now, all eyes were on The Star as the company desperately tried to steer the ship out of troubled waters with share prices falling faster than any anchor could. Indeed, between 1 January 2021 and 2024, they had fallen by 84%.
Neutron star (2024)
FY2024Revenue: $1.68bnNet profit: -$1.69bn
By 2024, it was obvious that The Star was collapsing in on itself. It had been hit with millions in fines, its management team was more like a revolving door and its net profit was down 71%. There was a glimmer of hope in May, when The Star’s team was insistent that Hard Rock Hotels & Resorts was interested in buying the company. However, Hard Rock quickly denied this and further warned that any misuse of the Hard Rock name in unauthorised business dealings would be taken seriously, the matter would be investigated and necessary legal actions taken to protect their brand reputation. The Responsible Gambling section of the 2024 Annual Report swelled to six pages long and noted that the company had revised 57 policies and frameworks, including its Safer Gambling, Incident and Breach Management, Conflicts of Interest and Whistleblower Protection policies.
Black hole (2025)
We are now in a period of post-collapse where, for a while, it seemed like there is no light left in The Star. On 3 March, Star Entertainment shares were suspended from trading on the stock exchange after the operator failed to submit its financial results and explained that “there remains material uncertainty as to the group’s ability to continue as a going concern.” The Star was selling off assets and made it very clear that things were spiraling for the company.
Or at least, that would be the case, if several last-minute offers hadn’t come in. The Salter Brothers offered The Star $940m in debt support, while Oaktree Capital Management placed a $650 debt refinancing offer on the table. As if things weren’t hectic enough, the US casino giant Bally’s also extended an offer to the Australian operator. These offers didn’t go unnoticed either, as the Crisafulli Government deferred the licence suspension from 31 March until 30 September following The Star’s “ability to make material headway on some key measures within the set timeframe”. As such, just as The Star was about to fade out of existence, it seems that this once-promising spark might just survive its almost-certain fate and find its place in our galaxy once more.
Indeed, as of 7 April, it was announced that Bally’s was to take control of The Star in a AU$300m deal. All change – but hope for the future, perhaps.
