Star Entertainment Shuts Down Rebates, Says Goodbye to Three More Executives
Star Entertainment in Australia is now in a constant state of flux. The casino operator faces the loss of its license in New South Wales, but hopes that making internal changes will stave off any major punishment.
The inquiry into Star Entertainment’s ability to hold a casino license in New South Wales (NSW), Australia, continues. As it does, more evidence surfaces that doesn’t put the casino operator in the best light. Repeatedly ignoring anti-money-laundering (AML) rules and falsifying data isn’t the way to impress regulators or the government.
NSW already determined that Crown Resorts was unsuitable to operate a casino in the state, and Star faces the same possibility with The Star Sydney. The company announced today that it is making additional changes that it hopes will appease NSW. It will no longer offer any type of rebate schemes for domestic or international players.
No More Player Perks
Through the rebate programs, players can convert rewards to money they can use to gamble. The programs are only available on certain games, but are regular incentives casinos provide to high rollers and other gamblers. Star said it will suspend their use “until further notice.”
Star doesn’t expect the suspension to have a serious impact on its economic situation, although this is already weaker due to stock sales. On January 4, the company’s price on the Australian Securities Exchange (ASX) was AU$3.79 (US$2.66). As of today, it is AU$3.09 (US$2.17). It has lost 21% over the last six months.
In addition to the suspension of the rebate programs, Star highlighted that it is making other efforts to get back on the government’s good side. It has brought in third-party advisors to help it reshape its business culture. The company asserts that it will “work with gaming regulators to address various identified risks as part of ongoing reviews of systems and processes.”
Crown made similar comments before NSW suspended its license. The company also faced possible suspensions in Victoria and Western Australia, but managed to avoid serious punishment in both. Star is looking at more of the same across the country, as well.
The Executive Exodus
Matt Bekier stepped down as the CEO of Star in March. That was just the beginning of the executive exodus, a string of high-profile resignations that will shake the company up even more.
Before the different states reached their verdicts on Crown, almost the entire executive floor and board disappeared. Similar changes are coming to Star, and three executives have already turned in their resignations.
Chief Financial Officer Harry Theodore, Chief Casino Officer (NSW) Greg Hawkins and Chief Legal & Risk Officer and Company Secretary Paula Martin are on their way out. All three have acknowledged some type of role in Star’s mismanagement, although not always as willing participants.
When Bekier took the stand in NSW’s inquiry last week, he singled out all three for their role in the company’s downfall. He alleged that they kept him in the dark about what was really going on behind the scenes. Bekier added that, if they had handled their responsibilities differently and informed him of their concerns, he would have taken measures to ensure Star complied with regulations.
Christina Katsibouba is now the interim CFO for Star. She previously served as deputy CFO from August 2019 to September 2020 and is currently the company’s chief gaming officer.
Katsibouba is the only person Star named as a replacement. It is now conducting interviews with the help of an executive search firm to find new appointees.
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