Case Study Spotlight
1. Case Summary
In September 2022, an independent inquiry led by Adam Bell KC found Star Entertainment Group unsuitable to hold a casino licence in New South Wales, and the New South Wales Independent Casino Commission responded by suspending the Star Sydney licence from 9 am on 21 September 2022, imposing a AU$100 million pecuniary penalty on 17 October 2022, and appointing Nicholas Weeks as Special Manager to run the casino in Star’s place, in a role that was meant to last 90 days. Weeks is still there now, which tells you most of what you need to know about how that timeline actually played out.
A second Bell inquiry reported on 30 August 2024, and it found Star still unsuitable, detailing why: a fraud scheme built around a faulty cash-out machine, inadequate vetting of high-risk patrons, and harm minimisation checks that were falsified in the record even where they had not actually been carried out. Six of the 30 recommendations from the first Bell report remained unimplemented two years on; management was described as siloed and combative, and its relationship with regulators was poor. The NICC issued a show-cause notice on 13 September 2024, giving Star until 27 September to respond, with cancellation of the NSW licence, a further penalty of up to AU$100 million, or amended conditions all on the table.
Star’s finances deteriorated alongside its governance, and as ASX trading in its shares was suspended, the company survived only by finding new capital. On 21 November 2025, the NICC approved Bally’s Corporation, a US casino operator, as a suitable substantial shareholder in a AU$300 million rescue investment, clearing the way for Bally’s to take effective control, but the casino licence remains suspended, Weeks remains in place, and Star remains subject to milestones on anti money laundering controls, gambling harm minimisation, governance and culture that an outside party must still independently verify before the suspension lifts.
2. Global Context
Crown Resorts, Star’s Australian rival, offers the closest comparison, since in May 2023 AUSTRAC and Crown jointly proposed a AU$450 million penalty for anti money laundering failures at Crown Melbourne and Crown Perth, which the Federal Court approved that July, with AUSTRAC finding the failures systemic, longstanding and egregious, including around AU$23 million in suspicious cash transactions in exclusive gaming rooms and relationships with junket operators despite known links to organised crime. Crown, like Star, had weak transaction monitoring and inadequate board oversight of compliance, but Crown negotiated a settlement and moved forward without an equivalent multi-year period of externally imposed management, which suggests its board retained more credibility with regulators than Star’s did.
A different kind of parallel comes from Nevada, where in February 2019 the Nevada Gaming Commission fined Wynn Resorts a then-record US$20 million after finding that senior executives knew of sexual misconduct allegations against founder Steve Wynn for years without escalating them to the board or to regulators, and Steve Wynn himself later agreed to a separate US$10 million settlement in 2023. That failure was not a technical compliance gap so much as a governance one, where known risk sat with people who had the standing to act on it and simply went unreported. Star’s falsified harm minimisation records sit in the same category, since they are evidence that existed to reassure regulators rather than to reflect what was actually happening on the casino floor.
3. Analysis
The tension in this case is that money has done what governance could not. Star survived financially because Bally’s put AU$300 million into the business, not because the culture the Bell inquiries criticised has genuinely changed, and the licence is still suspended as a result. Capital bought time, but it did not buy suitability, and the NICC’s approval of Bally’s as a shareholder is explicitly not the same thing as approving Star to operate again.
The dimensions pull in different directions here. Strategically, an Australian gaming icon now depends on a foreign entrant for survival, which raises its own question about what exactly has been rescued if the underlying operating licence stays suspended regardless. Ethically, the falsified harm minimisation checks are the most serious finding in the whole case, because a record showing a vulnerable patron was checked on when they were not is not a paperwork failure; it is a direct breach of the duty of care the entire licensing regime exists to enforce. Operationally, six of 30 recommendations sitting unimplemented two years after the first inquiry shows the failure was not a lack of intent but a lack of execution, and execution is squarely a management responsibility, not a regulatory one. And on the human dimension, an external Special Manager has now run the core asset of a listed company for three years, an arrangement so far outside the norm that it is itself a measure of how far the regulator judged internal leadership could not be trusted.
What would have happened had Star treated the original 90 day special manager period as the bridging measure it was actually designed to be, rather than needing four extensions and a second inquiry, is a fair question, and Crown offers a version of the answer: comparable AUSTRAC and royal commission findings, but a negotiated settlement reached without years of external administration, because Crown’s board retained enough standing with regulators to make and keep credible commitments. Star’s board evidently did not, which is the difference that actually matters here.
The decision now facing Bally’s and the NICC is whether new ownership and fresh capital count as evidence of change or are merely the means to attempt it, and that is where the pressure genuinely runs. It sits with the NICC, which must decide how much weight the Bally’s investment carries against milestones on money laundering controls, harm minimisation and culture that remain independently unverified, and it sits with Queensland’s regulator too, which oversees Star’s Brisbane and Gold Coast properties and must decide whether to hold the same sceptical line as NSW or move faster given the group’s financial precarity.
4. Governance Lessons
One, a special manager or external administrator buys time, not culture change, so genuine reform requires leadership change from within, verified by results, not simply new capital from without.
Two, falsified compliance or harm minimisation records are a strategic risk, not an operational detail, because they undermine the credibility of every other assurance a board relies on.
Three, recommendations without implementation deadlines and independent verification are not remediation. Six of 30 unimplemented after two years should have been a board-level alarm long before the regulator found it.
Four, financial distress and regulatory failure reinforce each other, as Star’s funding difficulties made remediation harder to finance, which then delayed the very compliance work needed to lift the suspension.
Five, a change of controlling shareholder resets the cap table, not the licence, so boards negotiating a rescue during regulatory administration should treat suitability approval, not capital, as the real gating milestone.
5. Boardroom Questions
1. If our organisation were placed under external management tomorrow, how long would our internal teams realistically need to implement every outstanding regulatory recommendation, and could we survive financially in the interim?
2. How do we verify that compliance and harm minimisation checks recorded by frontline staff actually happened, rather than relying on the existence of a completed record?
3. If a change of controlling shareholder were proposed as part of a rescue, what evidence would we require before treating it as proof of improved governance rather than simply improved liquidity?
Sources
1. iGaming Business, ‘Star Sydney shocking culture and disregard for authority laid bare in Bell Report’, 2024, https://igamingbusiness.com/casino/land-based-casino-regulation/bell-report-evidence-against-star-entertainment/
2. iGaming Business, ‘Star could face AU$100m penalty or licence cancellation over second Bell Report’, 2024, https://igamingbusiness.com/legal-compliance/star-penalty-licence-cancellation-bell-report/
3. Addisons, ‘Outcome of the 2024 Independent Inquiry into The Star’, 2024, https://addisons.com/article/outcome-of-the-2024-independent-inquiry-into-the-star/
4. NSW Independent Casino Commission, ‘NICC issues approvals for Bally’s Corporation to take next step as substantial shareholder of The Star’, 21 November 2025, https://www.nicc.nsw.gov.au/news-and-media-releases/nicc-issues-approvals-for-bally%E2%80%99s-corporation-to-take-next-step-as
5. AUSTRAC, ‘AUSTRAC and Crown agree to proposed $450 million penalty’, 30 May 2023, https://www.austrac.gov.au/news-and-media/media-release/austrac-and-crown-agree-proposed-450-million-penalty
6. Basel Institute on Governance, ‘The Crown Resorts anti-money laundering fine: a wake-up call for the gambling industry’, https://baselgovernance.org/blog/crown-resorts-anti-money-laundering-fine-wake-call-gambling-industry
7. Forbes, ‘Wynn Gets Hit With $20 Million Fine By Nevada Gaming Control Board’, 26 February 2019, https://www.forbes.com/sites/walterpavlo/2019/02/26/wynn-gets-hit-with-20m-fine-by-nevada-gaming-control-board/
8. The Nevada Independent, ‘Gaming Commission assesses Wynn Resorts a record setting $20 million fine’, https://thenevadaindependent.com/article/gaming-commission-assesses-wynn-resorts-with-a-record-setting-20-million-fine
9. The Nevada Independent, ‘Steve Wynn to pay a $10M fine to settle a 4-year-old complaint with Nevada gaming regulators’, https://thenevadaindependent.com/article/steve-wynn-to-pay-a-10m-fine-to-settle-a-4-year-old-complaint-with-nevada-gaming-regulators