Two Crown Resorts directors walk the plank as shareholders revolt


Australian casino operator Crown Resorts is losing two directors after a contentious annual general meeting that followed weeks of damaging revelations regarding regulatory non-compliance.

On Thursday, Crown announced the imminent retirement of directors John Alexander and John Horvath, both of whose names were recently tarnished at the New South Wales Independent Liquor & Gaming Authority (ILGA) inquiry into Crown’s suitability to hold a state gaming license for its Crown Sydney property.

Horvath was one of three directors up for re-election at Crown’s AGM on Thursday, and investors holding 31.3% of Crown shares voted against him retaining his seat. That’s slightly worse than the 24.8% who voted against Jane Halton’s re-election but much better than the 41.4% who voted against Guy Jalland sticking around.

All three directors had their bacon saved through the voting clout of James Packer, who controls around 36% of Crown stock and originally recommended Jalland’s board appointment. Horvath appears to have understood that most shareholders not named Packer wanted him gone, while Jalland and Halton appear to be of the ‘from my cold dead hands’ school of corporate entitlement.

More than one-third (34.3%) of shareholders also voted against Crown’s executive remuneration report, reflecting the widening view that Crown’s well-compensated senior staff can’t tie their own shoes, let alone ensure compliance with anti-money laundering (AML) protocols and other regulatory requirements at its casinos.

Under Australian corporate rules, this vote represented a ‘first strike’ against Crown and, should a vote of 25% or higher be recorded against next year’s remuneration report, a process would start that could lead to the entire board facing re-election.


Crown chair Helen Coonan’s speech to shareholders addressed some of the embarrassing revelations exposed over the past few weeks at the ILGA inquiry, saying the company “has never faced adversity like we are now.”

Coonan “unreservedly” apologized for the numerous “governance and risk management failings,” and vowed “there will be no tolerance” for execs who fall short in future. But Coonan “totally” rejected a shareholder’s query regarding whether Crown was actually “serious” about AML compliance.

Crown suspended all dealings with its junket operators last month after the inquiry heard of rampant AML failures at the Crown Melbourne casino. Coonan said Thursday that, should Crown choose to resume junket relationships, it would do so only after “extensive consultation with regulators regarding significantly enhanced due diligence processes.”

Crown CEO Ken Barton’s speech revealed that the company was looking to fill a number of new senior roles, including heads of Compliance & Financial Crimes, Culture & Human Resources, Internal Audit, and VIP Operations.

Among the positions not retained in Crown’s new structure is CEO – Australian Resorts, a role currently filled by Barry Felstead, who Barton said would be stepping down at the end of the year. Felstead was among the execs scolded at the inquiry for approving claims Crown made in newspaper ads regarding the vetting of its junket partners that later proved inaccurate.


Barton noted that Crown Melbourne remains closed as the state of Victoria has only just begun loosening its COVID-19 restrictions, while Crown Perth has been able to return “the vast majority” of staff to full duties.

Barton said Crown Perth’s performance from July 1 to October 18 showed mass market gaming revenue up 16% on the equivalent period last year – VIP gambling being “minimal” due to both pandemic travel restrictions and Crown’s newfound aversion to VIP scrutiny – while non-gaming revenue was down 21%.

Crown’s wagering and online social gaming revenue was up more than one-third, largely due to a surge in Betfair Australasia activity. Trading at the UK-based Crown Aspinalls casino operation has been “subdued” due to social distancing restrictions.

Crown Sydney remains on track to open in mid-December, assuming the damaging revelations don’t convince the ILGA to recommend the revocation of Crown’s NSW gaming license. Crown Melbourne’s long-term fate is even more unsure, given not one but two regulatory probes into the venue’s VIP gambling shenanigans.