The Melbourne-based casino operator, Crown Resorts, has become the target of a bidding war after being judged unfit to hold a gambling license. A New South Wales governmental investigation in February showed Crown Resorts had allowed money laundering to occur on its premises.
The bad news for Crown Resorts has initiated a frenzy of offers but the buyout will have larger implications than anyone expected. The leading bidder, Star Group, has made a commitment to the New South Wales Independent Liquor and Gaming Authority to end the practice of “junket” tours and work towards a cashless gaming environment.
“Junket trips” or “junket operators” are a, somewhat, new trend that emerged with the growth of the worldwide casino industry. In this case ‘junket’ refers to a pleasure trip where VIP high rollers are brought to a casino in a different country. Operations like these are a blend of travel agency, VIP service, and banking firm. These operators often seek out high roller’s who frequent Australia’s casinos and tailor the trips to match. In return for a fabulous gambling vacation, the high-rollers must agree to deposit an agreed-upon sum in the form of a commitment.
New South Wales Independent Liquor and Gaming Authority is the regulator that has the power to approve the merger between Star Group and Crown Resorts. The pre-merger talks have already begun with Star already agreeing that they will end the practice of junket tours. Additionally, the Star Group has made indications that it will seek to operate the newly acquired Crown Resort as a cashless operation. The cost of the merger is estimated to be A$9 billion and will be technically an all-stock buyout. Crown Resorts is backed by private equity firms like Blackstone and Oaktree Capital Group.
The Crown Resorts has had its fair share of controversy in 2021. CEO, Ken Barton, swiftly resigned after accusations of money laundering surfaced. The move towards a ban on cash transactions is an attempt to distance the organization from any possible future money-laundering. In addition to losing the CEO, the newly built Sydney Casino facility was unable to obtain a license to operate. Crown Resorts has committed to cashless gambling in their other casinos located in Melbourne and Perth. With the possibility that Star Entertainment will take over, it seems obvious to industry observers that they too will seek to operate in a cashless manner.
Cashless Gaming in Canada
COVID-19 restrictions are easing gradually across Canada and Canadians might be able to hit the slots sooner than initially expected. Like much else in our lives, the casino floor will look vastly different than it did before Covid. Slot machines will be spaced out and dealers will shield themselves with plexiglass. According to the CEO of the Canadian Gaming Association, Paul Burns, Canadians will be able to utilize digital payment services like Apple Pay when making a deposit.
The Canadian Gaming Association (CGA) has been working on its cashless casino project since the spring of 2020. The pandemic has added a sense of urgency to these plans. From a public health standpoint a casino player will physically touch quite a few objects while gimbling. The poker chips, slot machine handles/buttons, and doorknobs, only scratch the surface of objects anyone might interact with during a day at the casino. However, the biggest issue is ventilation. Unfortunately studies have shown that air-conditioning systems facilitate the spread of COVID even in large indoor spaces.
The CGA has recently released a draft of its “Standards for Cashless Systems”. At the moment they are waiting for feedback from the industry. Mr. Burns has stated that the system will be very similar to the current one working in online casinos. They are pushing towards having players create an account with the operator where the funds could be stored. Another proposed option is that the player has an account that allows for identification and the funds within are linked securely to the operator’s cashless system.
There are plenty of businesses and grocery chains that have banned paper transitions altogether because COVID-19 can spread through paper currency. According to the United States Center for Disease Control and Prevention, it is a good move to prioritize a touchless payment options.
Implications of the Cashless Casino
Due to COVID-19 most gambling today is done online. Even before COVID-19, many gamblers preferred the comfort of their own home to physically traveling to a casino. It’s a known fact that land-based casinos have historically had a very limited number of payment options.
This has without a doubt made most gamblers resort to online gambling.
Australian online casinos now have to consider if cashless casinos will be a threat to the flourishing online casino industry. And as soon as COVID-19 slows down to a halt that might just be a new reality. However, without the cashless casino and the reduction in COVID-19 infection spread, online casinos continue their mind boggling expansion.
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