James Packer’s former lieutenant and Crown’s former chairman, Robert Rankin, has been eviscerated by the NSW commission of inquiry into Crown. The commission has got sharp teeth and clearly intends to use them.
But first Rankin must be located.
He is away from his UK home and intends to be somewhere in Europe for “an extended period of time” having refused all requests to give evidence and rejected the commission’s authority to force him to appear before it.
Over several months the commission has been playing a game of communications ping-pong with Rankin’s lawyers. To no avail. Ultimately the commission took the nuclear option.
For his part Rankin looks to have exercised a fatal error of judgment in messing with the commission of inquiry.
In a stunning close to its interrogation of Crown directors, counsel assisting Scott Aspinall suggested commissioner Patricia Bergin could recommend Rankin be referred to the Australian Securities and Investments Commission for breaches of Corporations Act.
He did so on the basis that Rankin failed in his obligation of due care and diligence to alert the Crown board of the need to elevate his concerns about the significant risk to the company’s staff in China. Also, that he failed to protect them from their arrest which ultimately took place in 2016.
In addition, the inquiry heard Rankin as Crown chairman failed in due care and diligence when he failed to tell the Crown board of the serious threat made by James Packer to a private equity executive that we now know to be Ben Gray.
It isn’t yet a scalp but it’s likely to send a shiver down the spines of other Crown directors – all of which were wise enough to front the inquiry as witnesses.
The most nervous of which must be Packer. He was deeply immersed in many of the issues that formed the basis of the inquiry – including his private company’s sale of 10 per cent of Crown to Melco and a now defunct agreement to sell it an additional 9.9 per cent.
The inquiry has heard extensive evidence of Packer’s involvement in Crown’s international VIP business. It was the international VIP business’s dealings with junket operators who had links to organised crime which has been another key plank of the inquiry.
There is no suggestion that Packer has broken any laws. But clearly the extent to which the commission has shown it means business does not augur well for Crown’s chances of coming out of this process without sustaining damage.
The commission will be making recommendations on a range of issues including the suitability of Crown to hold a casino licence in NSW and the suitability of its current directors to be associated with a casino licence.
Whether it recommends others be referred to ASIC remains to be seen.
The other board members and senior management took their opportunity as witnesses to explain and defend their positions. Packer, for example, said his threatening letter was the result of his mental health at the time.
Wednesday’s explosive conclusion to several weeks of evidence from the board comes on the eve of the company’s annual general meeting at which three directors are up for re-election.
While there is an expectation of a substantial protest vote from large minority shareholders, the company has not withdrawn the resolutions to re-elect directors.
This suggests Packer will vote his 36 per cent stake in favour of those directors.
At this stage there remains the potential for the commission to recommend caps be placed on individual shareholders – a move that would require Packer to sell down his stake.
Source: Thanks smh.com