China Arrests Crown Resorts Staff Betting We’ll Get The Message

The arrest of staff from Crown Resorts operating in China has set the cat amongst the pigeons but as the company looks to expand in Vegas and Sydney and face stiff competition from Bet365 and it’s ilk, do these arrests indicate more for the firm to wrestle with than just the unsubtle communication methods of the Chinese authorities?

Crown Resorts Staff Arrested

• Three Australians based in China
• Jason O’ Connor VIP VP
• Local admin freed

If you’re like me and think that Martha Stewart and Snoop Dogg presenting a cookery show together is definitely a sign of the apocalypse every bit as much as was Donald Trump’s election, you’re probably already aware that the Wu Tang Clan (and I quote) “ain’t nothing to fuck with”, however they are by no means alone in that regard, and as some employees of Crown Resorts in China have discovered, when it comes to Chinese gambling laws, neither are the local authorities.

The sweeping generalization that even senior executives of a major Australian corporation like Crown Resorts should have got wind of, is that whilst Chinese people are in of themselves quite fond of gambling, China as a nation is dead set against it. Indeed as part of it’s ongoing war on corruption (as likely to succeed as ‘the war on drugs’ and ‘the war on terror’) China has in recent years cracked down on gamblers, something to which profit margins in Macau can attest.

Bet365 Has Cut Into Casino Profits But Not As Much As China

Having been ‘detained’ a month ago the eighteen Crown Resorts employees, including three Australians, Jason O’Connor Vice President of the VIP Division numbering amongst them, have now been arrested and look to be facing a Beijing gambling jail sentence, something that will do nothing for the company’s stock prices that took a beating when the news of the detentions came through. This is mostly because fewer high-rollers from China will cause a battering of the bottom line, but party because it indicates piss poor management.

“The arrests raise the question about the extent to which (Crown Resorts) China based staff, who were incentivized through a commission-based system, operated illegally to lure lucrative high-rollers.” Said a Regnan report and went on to note that “both independent members of the Risk Management Committee do not have deep operational experience in Asia potentially reducing effectiveness of oversight.” Leaving staff among the Chinese gambling news of their arrests does more than make James Packer wince.

Crown Resorts Management Failure To Blame For Arrests?

Now the chances are that technically none of Crown Resorts staff have broken the law per se. However in the same disingenuous manner they pretend they are merely promoting tourist attractions near their resorts and not the gambling inherent in their business model, the Chinese authorities may yet find them innocent at trial, having merely kept them in detention for six months or so (as is common in China) and pretend they’re not sending a message to other similar firms who unlike Bet365 operate physical casinos and resorts.

You don’t have to regularly bet on sports in China to figure out the odds on any number of senior executives from gaming companies visiting the country anytime soon are going to be quite high if not astronomical, so in that regard these well publicized arrests have done their job, the warning toward caution received by Crown Resorts and the wider gaming community chasing Chinese gamblers, every bit as loud, clear and emphatic as that of the Wu Tang Clan. China; It ain’t nothing to fuck with. Right, Jason?