First activity report of the Special Manager for the Melbourne Casino Operator released

The Office of the Special Manager for the Melbourne Casino Operator today publicly released an activity report, providing an update on the work of the Special Manager during the first six months of operation. 

The Special Manager, Stephen O’Bryan KC, has extensive legislative powers to independently monitor and assess Crown’s reform program in response to the Finkelstein Royal Commission, as well as to oversee, and if necessary direct, its current operations. 

During the six months between 1 January and 30 June 2022, the Special Manager has established a small, multi-disciplinary team – the Office of the Special Manager (OSM) – to support his work and focus on: 

• meeting regularly with Crown’s senior leadership team and building a sound understanding of the reform work Crown is undertaking in response to the Finkelstein Royal Commission, as it seeks to return to suitability to hold the Melbourne casino licence 
• engaging with key stakeholders across government, industry, and community sectors, particularly in relation to gambling harm minimisation and preventing financial crime 
• identifying key areas of focus for monitoring and assessment of Crown’s reform work in the next reporting period to 31 December 2022. 

The activity report acknowledges that Crown is undertaking a complex and significant reform program and it has already taken a range of positive steps. It notes, however that considerable further work is required by Crown to demonstrate the level of reform and embedded change the Finkelstein Royal Commission recommended.  

The activity report references the change in ownership of Crown, following its recent acquisition by Blackstone Inc. It notes the Special Manager is encouraged by his early engagement with Blackstone senior representatives, who have indicated their commitment to the reform program. 

This is the first of 4 activity reports, which will be publicly released by the OSM every 6 months.  

The Special Manager has also provided his first more detailed interim report to the Minister for Consumer Affairs, Gaming and Liquor Regulation and the Victorian Gambling and Casino Control Commission (VGCCC). The Interim Report is required to be submitted on a confidential basis due to the ongoing, and legally and commercially sensitive nature of the Special Manager’s work. 

In December 2023, the Special Manager will submit a final report to the VGCCC to assist the regulator in determining whether Crown has returned to suitability to hold the Melbourne casino licence. 

Read the activity report

Media contact: media@osm.vic.gov.au

Background

The blueprint for the Special Manager’s work is set out in Appendix I of the Finkelstein Royal Commission report. The key areas in which Crown needs to demonstrate reform are in relation to cultural change, governance, risk management and compliance, responsible service of gambling, and preventing financial crime. The Special Manager’s work includes independently monitoring and assessing a range of projects and activities Crown is undertaking to effect change in these areas. 

The role of the Special Manager is a unique role in Australian corporate history. The Special Manager has significant powers under the Casino Control Act 1991, including all the powers, rights and privileges of a Crown Melbourne director (except the right to vote). The Special Manager also has statutory powers to direct the casino operator to take action or to refrain from taking action. 

It is unique for a monitor overseeing a solvent company to have such extensive supervisory powers. The powers of other significant monitorships over solvent companies (such as those overseeing WorldCom in 2002 and Volkswagen in 2018) have included the power to access information and to make recommendations regarding corporate governance, but not to direct a company to take, or to veto, action.  

These significant supervisory powers, similar to those of a corporate administrator, have been enacted by the Parliament of Victoria in view of the Finkelstein Royal Commission’s damning findings, and the importance of the VGCCC being fully and independently informed by the end of 2023 about Crown’s suitability to retain its casino licence.  

Further information is available at our website.