MACAU BUSINESS By Nelson Moura By Paolo A. Azevedo


Operators advised to re-examine relation


Exclusive Macau Business/Macau News Agency with junkets


Jeju will be as big as Singapore in terms of Gross Gaming Revenue, predicts Lawrence Teo. The Chief Operations Officer and Vice President of Dream Tower, the tallest Integrated Resort under construction on the Korean destination island, explains to Macau Business why Lotte Tour decided to enter the casino business and create a landmark. All bets are on making the casino resort the crown of the tourism jewel the company has been dominating for four decades


Jeju – the new Singapore


T


he recent inquiry into Australian casino group, Crown Resorts, shows how reliance on junkets has rendered casino companies and affiliates actively vulnerable to regulatory, reputation and criminal risks, Political and Corporate


Risk Consultancy Steve Vickers & Associates Ltd (SVA) stated in a recent dispatch. The results of an inquiry held by Australian authorities


and released recently has declared Crown as unfit to hold the licence for its new A$2.2 billion casinos on Sydney Harbour, after condemning the company’s anti-money laundering efforts and criticising its links to Macau junket promoters and triad societies. According to Steve Vickers – who gave formal evidence


to the inquiry led by former Supreme Court judge Patricia Bergin – the investigations serves as a warning to other gaming companies who rely on Macau junkets to find VIP gamers and that may have “in some cases, downplayed the risks of indirectly dealing with triad societies when doing so”. “This report makes clear that they much change tack,


however, and refresh due diligence assessment of junket partners,” Vickers states. In testimony provided to the inquiry, Vickers stated that some junkets rely on triads to carry out “extra-legal services” such as the promotion of gaming, evasion of capital controls, and collection of gaming debts. Vickers state that the most “egregious” AML failures by


M 18 OCTOBER 2017 18 APRIL 2021


Crown involved activities in VIP rooms operated by Suncity at its Melbourne casino, due to the Bergin report perceived links between junkets and triad activities. The Bergin inquiry examined numerous instances of


As an example the security consultant mentions how


Crown failed to identify worrying signs that its operations in Mainland China could be targeted, leading to the arrest of 19 of its employees in 2016. Therefore special attention should be given by companies


to new jurisdiction or intentions exposed by Chinese central authorities concerning capital flows and gaming, and how their business or business partners could be exposed to it. “Looking forward the situation will pose challenges to


Macau’s foreign casino concessionaires, given the looming end of concessions in 2022,” the consultancy states.


Tightening the grip On February 5 China’s Ministry of Public Security issued a


acau Business – From Lotte World, a major recreational complex [with the world’s largest indoor theme park, in Seoul] to an integrated resort with casino in Jeju. A different beast. A


natural evolution? Lawrence Teo – Business is the same. But building


a landmark. M. B. – The group [Lotte] has created other landmarks in different types of business. Why would this be different? L. T. – Yes, Lotte Group has already created


suspected money laundering at Crown Melbourne, with footage showing large bundles of A$50 notes being exchanged for gambling chips in one of Crown’s VIP gaming rooms. The security consultant also warns other businesses included in the same eco-system as gaming companies, such as financial and trading businesses, who transfer funds and are therefore also “vulnerable”, together with hotels, real estate companies and any other businesses that benefitted from the Macau gaming boom. Any stakeholders were advised to closely monitor changes


to regulatory regimes, identify possible vulnerabilities early and respond quickly.


statement urging criminal suspects in cross-border gambling to ‘surrender’ and focused on overseas gambling groups that are attracting gambling during the Chinese New Year.


downtown Seoul and Lotte Super Tower. We’re trying


The announcement came in the aftermath of several legislative changes imposed by the Chinese central government to tackle cross-border gambling promotion. China’s National People’s Congress passed an amendment to its criminal law that created, from March 1st, a new crime targeting cross-border casinos found to be organising or soliciting Chinese citizens to gamble, while increasing penalties for those found guilty of serious breaches.


to do the Dream Tower in Jeju. Lotte here is being just a family company; we’re a different company [Lotte Tour]. It’s not going to be [just] the tallest and the largest building in Jeju, that’s just the hardware. We say that a landmark should be the most visited destination, where tourists will go to eat, shop and maybe [visit] our observation deck. A must-visit point destination. Because of the hardware, and also the software.


M. B. – What are the main goals that you definitely


want to achieve with this Integrated Resort (IR)? L. T. – Number one EBIDTA on IR in Korea. There’s


The amendment specifically targets anyone who ‘organizes mainland Chinese citizens to gamble outside the country’s (borders)’ leaving some ambiguity over if it could be applied to Hong Kong, Macau, and Taiwan. Then China’s Ministry of Culture and Tourism announced that it would extend its travel blacklist of overseas gambling jurisdictions or countries that promote gambling tourism for Chinese nationals, with analysts believing countries such as the Philippines, Cambodia, Myanmar, Laos, Vietnam, and even Australia could be included.


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