“FOUR CORNERS” General Crown Resorts Has Been Extensively
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RESPONSE TO QUESTIONS FROM “FOUR CORNERS” General Crown Resorts has been extensively investigated and in all cases has found to be suitable by gaming regulators in a number of jurisdictions in Australia and world-wide, including Victoria, Western Australia, NSW, Queensland, Tasmania, United Kingdom, Macau, Nevada and Pennsylvania. All jurisdictions have found Crown Resorts suitable to either operate casinos or have investments in casinos (as the case may be) in their jurisdiction. Those investigations include the submission of detailed background information, including financial information, by the Crown Group and its directors and senior executives and the conduct of interviews with directors and senior executives. Many of the jurisdictions undertake periodic updates or licence renewals and all have a regime of continuous monitoring. Melco Crown Entertainment and Mr Lawrence Ho As part of those processes, Mr Lawrence Ho, the managing director of Melco Crown Entertainment Limited, a company listed on 2 stock exchanges and in which Crown has a 33.6% interest, has provided requested probity information and has been interviewed by gaming regulators and/or law enforcement agents by a number of Australian and international regulators, including gaming regulators in Victoria, NSW, Queensland, Nevada and Pennsylvania. Lawrence Ho has always cooperated fully with Crown’s gaming regulators. In response to your unfair and unjustified inferences regarding Mr Lawrence Ho, Crown’s gaming regulators have found that Lawrence Ho’s business interests are independent from his father, Stanley Ho, and, as such, Lawrence Ho has been found suitable to be associated with Crown. A number of Crown’s gaming regulators require Crown to regularly report whether Crown has any dealings with entities or persons known to be associated with Stanley Ho. Crown complies with those obligations and has no dealings or business relationships with Stanley Ho or entities controlled by him. Junket Operators Junket operators do not have any say in the operation of Crown’s casinos. They are not major shareholders nor are they represented on the Board. All casino operations (conduct of games, security, surveillance and cage operations) are undertaken by the casino operator. Junket operators are independent contractors who bring customers to the casino for which they receive a commission – they do not operate the casino business. Junket operators in Macau must be licensed by the Macau gaming regulator and Melco Crown Entertainment’s casinos in Macau only deal with licensed junket operators. All international VIP customers of Crown’s casinos in Australia (ie those persons who come to the casinos, play the games, place bets and receive winnings (if they win)), and all junket operators that bring those customers, are identified with appropriate Know Your Customer (KYC) procedures, have due diligence undertaken on them and appropriate reports are submitted to AUSTRAC and relevant gaming regulators as required by law. Individual VIP customers, junket operators and their players who come to Crown’s Australian casinos are required to have visas to come to Australia and, therefore, are subject to federal government checks as part of the visa application process. Taiwan In response to the recent indictment in Taiwan of the branch office of a subsidiary of Melco Crown Entertainment, Melco Crown Entertainment has said that it believes its branch office has been operating in compliance with Taiwan law and that they will vigorously defend the indictment. Barangaroo Restricted Gaming Licence The NSW Independent Liquor and Gaming Authority’s (ILGA) investigation of Crown began in February 2012, when Crown applied to acquire more than 10% of Echo’s shares. That investigation concluded in May 2013, almost 15 months later. That investigation included ILGA agents and NSW police travelling to Hong Kong, Macau and the Philippines and interviewing MCE senior executives including Lawrence Ho. Crown lodged its application for a restricted gaming licence at Barangaroo South in December 2013, only 7 months after the previous investigation concluded. ILGA concluded its subsequent investigation and issued the restricted gaming licence to Crown in July 2014. In total this is a 22 month (15 + 7) investigation and application process. The amendments to the Casino Control Act passed by the NSW Parliament in November 2013, contains a section which directs ILGA to have regard to the previous investigation when investigating Crown’s application for a restricted gaming licence. See Section 13A(3). Anti-Money Laundering and Law Enforcement Crown is required under Federal anti-money laundering legislation to: • have an approved anti-money laundering compliance program; • report all significant cash transactions to AUSTRAC; • report all suspicious transactions to AUSTRAC; and • report all international fund transfers to AUSTRAC. Crown’s compliance with this anti-money laundering legislation is audited regularly by AUSTRAC and no major compliances issues have been found. Crown has a strong reputation for cooperation with law enforcement agencies and works closely with Australian State and Federal law enforcement to assist them with their intelligence gathering and operations. If Four Corners has any evidence of breaches of any laws by any person, then we urge you to provide that evidence to the appropriate law enforcement agency and/or gaming regulator whether in Australia or Macau. 11 September 2014 .