Shareholders Class Action Lawsuit Makes Damaging Claims Against Crown Resorts
Crown Resorts has faced multiple challenges in the last few years that has damaged the reputation of the casino operator and caused share prices to fall.
Crown Resorts is currently facing a class action lawsuit filed by its shareholders and things are not looking good for the operator.
Maurice Blackburn, the law firm that has filed the class action lawsuit made some serious allegations against the casino operator. The lawsuit claims that Crown Resorts knew that China was cracking down on gambling operators but still choose to continue to target Chinese players and lure them to their Australian casinos.
Crown Resorts is alleged to have hired and trained employees to target the Chinese market and use code words when referring to China. However, Chinese authorities got the better of Crown Resorts when they arrested 19 employees in October 2016 for illegal marketing and promoting of gambling activities.
Those employees were arrested and detained in China for deliberating targeting Chinese gamblers. Crown shares plunged by nearly 14 percent after this and the casino operator would later go on to pull out of the Asian market and close all of its offices.
The law firm has also claimed that Crown Resorts fudged details of its private flights from Australia to China claiming that Crown executives were flying in and out of the country when in reality it was used to transport Chinese VIP gamblers to the Crown’s casinos.
The hearings for this class action lawsuit will take place in Melbourne on 31 March.
Crown Resorts Could Lose License
Crown Resorts is currently waiting to see if the New South Wales (NSW) gaming regulator will give the operator the green light to open the casino floor of its A$2.2 billion Crown Barangaroo Casino Resort in Sydney. The NSW gaming regulator prevented Crown Resorts from opening the Barangaroo casino floor as an investigation into Crown Resorts showcased serious compliance issues.
Crown Resorts is also waiting on the results of an on-going investigation into its flagship Crown Melbourne casino by the Victorian Commission for Gambling and Liquor Regulation (VCGLR). The Victorian gambling regulator launched its own investigation to see if there were serious gaming regulation violations by Australia’s biggest casino operator.
These new allegations made in the class action lawsuit are not going to help Crown Resort’s image when it comes to keeping their Victoria and NSW casino licenses.