Casino giant Crown Resorts has warned the Federal Court it cannot afford a hefty $450 million fine for breaching anti-money laundering and counter-terrorism laws unless it can be paid in instalments over a two-year period without incurring interest.
Australia’s financial crime regulator and Crown agreed in May to a $450 million proposed settlement for contraventions at its Melbourne and Perth casinos, which the Federal Court will ultimately approve or reject.
At a hearing on Monday, Justice Michael Lee raised concerns with some aspects that determined the proposed financial penalty, including the fact it did not consider the money returned to shareholders during the period when it broke the law.
Crown and AUSTRAC had agreed to a $450 million fine. Luis Ascui
But Crown’s barrister, Philip Crutchfield, KC, said the $450 million was agreed to only on the condition it would be paid over a two-year period, with an initial tranche of $125 million.
“We simply would not have agreed to pay this amount if we didn’t have the payment plan and AUSTRAC knows that. If your honour pulls on that thread of the agreement, that pulls apart the foundation stone for the agreement,” he said. “We can’t afford to pay more than we’ve agreed.”
Under the proposed terms arrived at by AUSTRAC and Crown, the casino operator would pay $125 million upfront, a further $125 million within 12 months, and then a final instalment of $200 million, all interest-free.
This payment plan was agreed on to manage Crown’s financial liabilities and liquidity, and sustain trading through weaker market conditions.
Justice Lee said describing the proposed settlement as a pecuniary penalty was “apt to mislead”.
“A pecuniary penalty of $450 million would be attracting
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