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Australia – Crown hit with record fine for illegal use of China UnionPay cards

By - 30 May 2022

Australian operator Crown Melbourne has been hit with a record-breaking fine of AU$80m due to the illegal use of China UnionPay cards.

Crown’s China UnionPay process saw Crown Melbourne let customers use credit or debit cards to access funds to gamble, to the tune of AU$164m over a four year period between 2012 and 2016.

The Victorian Gambling and Casino Control Commission (VGCCC) said: “On 27 May 2022, the Commission determined that there are grounds to take disciplinary action against Crown Melbourne in accordance with section 20(1)(dc) of the Casino Control Act 1991 (Vic) and has determined to impose a fine of $80m.

“This disciplinary proceeding relates to the illegal conduct of Crown Melbourne between 2012 and 2016, whereby patrons were allowed to use credit or debit cards to access funds to gamble at the Melbourne Casino. This illegal conduct facilitated access to nearly $164m, from which Crown derived an estimated revenue of more than $32m.”

Crown stated: ” Crown has today been informed by the VGCCC that it has taken disciplinary action in relation to the
China UnionPay process by imposing a fine in the amount of $80 million on Crown Melbourne Limited, payable in 28 days from the date of the decision (being 27 May 2022). Crown Melbourne has also been ordered to pay the VGCCC’s costs of this disciplinary action, which are yet to be advised. The VGCCC has indicated it continues to consider “further disciplinary proceedings against Crown related to the other findings of the Royal Commission, which may each attract a fine of up to $100m.”

It added: “Crown acknowledges its historic failings. The China UnionPay process ceased in 2016. Upon becoming
aware of this historical conduct, Crown’s Board immediately commissioned an independent investigation
and shared the findings with the Victorian Royal Commission, the Victorian Commission for Gambling
and Liquor Regulation (the predecessor to the VGCCC) and other regulators. Crown’s Board and senior management are committed to the delivery of a comprehensive reform and remediation program to ensure Crown delivers a safe and responsible gaming environment and continues to cooperate with the VGCCC on all matters arising from the Victorian Royal Commission Report.

VGCCC Chairperson Fran Thorn explained: “Crown’s CUP process was a clandestine, deliberate process, which not only breached the Casino Control Act but was also devised to assist patrons to breach China’s foreign currency exchange restrictions. Crown was aware of the risk that the CUP process could be illegal but decided to run that risk. In doing so, it showed no regard for upholding its regulatory obligations. Indeed, it went to some lengths to hide what it was doing.”

“Crown benefited handsomely from its illegal conduct. The fine will ensure that Crown is stripped of the revenue it derived from the CUP process and will send a clear message that it must comply with its regulatory obligations,” it added.

Further breaches could see more fines of up to AU$100m.

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