Fate of detained Crown Resorts Limited employees could soon become clearer
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Fate of detained Crown Resorts Limited employees could soon become clearer

Updated:2024-06-20 15:23    Views:175

The fate of the 14 employees of Australian casino operator Crown Resorts Limited being held in China for “gambling crimes” could soon become clearer after police formally turned the cases over Shanghai’s Baoshan District People’s Procurator.

According to a report from the Australian Financial Review, the employees, which include three Australian citizens in Jason O’Connor, Jerry Xuan and Pan Dan alongside Malaysian Alfread Gomez, were arrested after an October 13 sting operation and have since been languishing in a Shanghai detention facility although the most recent move means that law enforcement officials have now completed their investigations with formal charges expected to follow soon.

The employees of the Melbourne-based firm were detained by police in Shanghai as part of an operation dubbed “Duanlian”, which in Chinese translates as “to break the chain”. It is illegal to promote or organize gambling activities in mainland China and the government has long been attempting to curtail its nationals from engaging in overseas gambling by terminating the personal and financial links between foreign casino operators and their mainland clients. Led by President Xi Jinping, officials perceive that the activity is linked to corruption, money laundering and domestic instability particularly as many of the gamblers that have gone broke as a result of gambling have been small business owners.

The Australian Financial Review reported that the fact the cases were handed to a district court rather than a city counterpart means that the 14 are likely to face lower-level charges rather than those associated with more serious offences such as money laundering. As such, the newspaper cited Shanghai criminal lawyer Si Weijiang as declaring that the accused could face prison terms of up to three years if convicted.

The newspaper reported that the October arrests were devastating for Crown Resorts Limited as its half-year VIP revenues subsequently dropped by 45% year-on-year while its overall adjusted profits declined by 9.1%. The firm consequently reshuffled its board, instituted an “efficiency drive” that could ultimately lead to job cuts and reduced its exposure in China by selling all of the shares it had held in recently-renamed Macau casino operator Melco Resorts And Entertainment Limited worth $1.1 billion.

Crown Resorts Limited is moreover facing a class-action lawsuit being brought by a group of investors and seeking compensation for the drop in the price of the firm’s shares following the arrests. According to a report from the Australian Associated Press news service, the shareholders intend to argue that the casino operator should have notified investors about the risks associated with its strategy well before the arrests.

“We have reason to believe that; one, Crown [Resorts Limited] knew the risks of its activities in China, two, it knew of the importance of VIP revenues to its business and three, it therefore knew or should have known that if the real nature of its marketing activities were revealed there would be a revenue problem that would be material to Crown [Resorts Limited’s] share price,” Julian Schimmel from law firm Maurice Blackburn Lawyers told the Australian Associated Press in February. “This is information that the company’s shareholders should have been told so that they could factor it into the share price and buy their shares on a fully informed basis.”



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The fate of the 14 employees of Australian casino operator Crown Resorts Limited being held in China for “gambling crimes” could soon become clearer after police formally turned the cases over Shanghai’s Baoshan District People’s Procurator. Accordi