Monday 15th September 2014
Australian casinos that target Asian VIP gamblers to boost their profits could run a serious risk of exposure to organised crime, according to a range of law enforcement and security experts.
This week on Four Corners, reporter Linton Besser investigates the drive to entice foreign gamblers to Australia and the implications of that strategy.
Running casinos can be a lucrative business. It’s estimated that the industry here generates around five billion dollars a year. Much of that money comes from ordinary Australians, but increasingly companies that run casinos are seeking to boost their profits by attracting high rollers, particularly from China. VIP players are willing to bet hundreds of thousands of dollars in a single wager.
These big gamblers are often brought to the casino by companies called junkets. In Asia’s gambling epicentre of Macau, off the coast of China, they locate, transport and provide credit for the gamblers, and they have made local casino operators enormously wealthy. However, until recently Australia has only had a slender share of the VIP market.
Now Crown, led by James Packer, has won approval to develop a six star hotel and casino complex at Barangaroo on the shores of Sydney Harbour. And this casino will cater solely to VIP players.
Who are these high-rollers? Where do they get their money? And who is profiting from the junkets that bring them here?
In Macau, the junket operators are major companies, with some listed on the stock exchange. Despite this, there is evidence that some have links to organised crime.
In part, those links to criminals have been boosted by the fact that gambling is illegal in mainland China, and there is a limit to the amount of money high rollers can take out of the country. The fact that Chinese VIPs gamble on credit – which cannot be legally enforced in the mainland – can invite debt collection via extra-judicial means.
As one gambling expert told the program:
“They turn to organised crime to enforce gambling debts, using violence or threats of violence.”
The question is, how do Australian casino operators like Crown get the benefits of the junket industry but keep out the criminals? Those who know the gambling industry say it’s very difficult:
“That’s easier, much easier said than done, because if the casino is totally focused on upper end VIP only, then that appeals to a small, a certain element, and that is difficult.” – Gambling expert
This leaves any casino operator relying on VIPs with a problem. It leaves governments with a problem too. Organised crime has found a home in Macau. Will it look for more opportunities here?
HIGH ROLLERS – HIGH RISK?, reported by Linton Besser and presented by Kerry O’Brien, goes to air on Monday 15th September at 8.30pm on ABC. It is replayed on Tuesday 16th September at 11.00am and 11.35pm. It can also be seen on ABC News 24 at 8.00pm Saturday, ABC iview orabc.net.au/4corners.