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An inquiry likely to determine the fate of the Sydney casino licence of The Star Entertainment Group has warned the company it may have broken the law by delivering documents relevant to witness testimony two weeks after deadline.
After two days of damaging testimony, the third day of the second independent inquiry into Star Entertainment started disastrously for the company on Wednesday (April 17), with inquiry head Adam Bell SC set to decide if the company breached the Royal Commissions Act over late delivery of evidence.
Star Entertainment sent the inquiry a tranche of documents overnight, including some relating to Tuesday鈥檚 testimony of former CFO Christina Katsibouba, who alleged that former CEO Robbie Cooke withheld debt metrics from The Star casino鈥檚 external special manager Nicholas Weeks and the Star Entertainment board.
Katsibouba also alleged that investor relations head Giovanni Rizzo asked her to shield a A$3.2m ($2m) loss caused by a slots machine technical anomaly by adjusting the company鈥檚 half-year results.
Katsibouba resigned in March, and the company鈥檚 characterisation of her departure as 鈥渢ermination without cause鈥 is also attracting inquiry scrutiny.
Bell started the day鈥檚 hearing by admonishing Star Entertainment over the inexplicably late delivery of 鈥渜uite a large number of documents鈥.
鈥淭hey ought to have been produced in answer to summons鈥 by April 3, he said. 鈥淭hey鈥檝e been produced two weeks late at a time when Ms. Katsibouba鈥檚 examination is at an advanced stage.鈥
Bell said he understood that all parties had been under pressure.
Nevertheless, he said, 鈥淚 would appreciate the courtesy of an explanation, so I can form a view on whether an offence has been committed under 鈥 the Royal Commissions Act鈥.
Bell then adjourned the hearing for around two hours to allow counsel assisting to examine the documents and their relevance to Katsibouba鈥檚 testimony, but not before complaining this was at 鈥渃onsiderable expense to all concerned鈥.
The previous day鈥檚 hearing ended with Star Entertainment鈥檚 external counsel, Bret Walker SC, aggressively questioning Katsibouba over the circumstances of her resignation and its impact on her severance, insinuating that her testimony was not fully plausible or truthful.
But after Bell鈥檚 demand this morning for an explanation for the late documents, Walker did not appear for Star.
Instead, a junior lawyer colleague told the inquiry that Walker had another engagement, adding that Star apologised for the late delivery, and that a statutory declaration on the matter would be sent to the inquiry as soon as possible.
In another bad omen for Star Entertainment, the hearing resumed with counsel assisting the inquiry, Caspar Conde, devoting the remainder of Katsibouba鈥檚 appearance to reinforcing her earlier testimony.
The significance of the late-arriving documents鈥 contents, if any, is yet to be made clear.
But Star Entertainment鈥檚 breach of protocol, and possibly the law, together with its counsel鈥檚 aggressive questioning of a former executive who alleged poor governance, heaps more pressure on Star after a bad start to the inquiry, and ahead of testimony of current staff in the weeks ahead.
On Monday, Conde showed the inquiry communications between former CEO Cooke and Star chairman David Foster that indicated the two were considering a shareholder class action and getting 鈥渞eady for war鈥 with special manager Weeks and the New South Wales (NSW) state gambling regulator.
Weeks was also shown what he called 鈥渆xtraordinary鈥 evidence suggesting the senior leadership team had covertly monitored his communications and/or scheduling data on his Star email account, and that such information had been used to investigate at least one lawyer with whom Weeks was communicating.
NSW Independent Casino Commission (NICC) chair Philip Crawford, who ordered the second Bell inquiry into Star Entertainment鈥檚 suitability to regain a casino licence, has warned the company to be compliant by mid-year.
The inquiry鈥檚 report is due to be handed to the NICC by July 31.
