The woes of Crown Resorts seem far from over, and now scrutiny has turned to executive chair Helen Coonan - with some suggesting she should resign from AFCA before her term as chair ends in May.
Today Crown announced that Coonan will be paid an extra $1.8 million, after stepping in as interim executive chair to lead the company when chief executive Ken Barton resigned on Monday. This brings her total remuneration from Crown to $2.5 million a year.
The company also released its half year results today. Statutory revenue was down 62.1% to $581 million, NPAT down 155.4% with a reported loss of $120 million and EBITDA down 99% to $4.4 million. Crown did not declare an interim dividend.
Speaking to Financial Standard, Alphinity portfolio manager Bruce Smith said he isn't sure how Coonan sailed through the NSW inquiry into Crown - which found the company was not suitable to hold a casino licence - and kept her position as chair.
"Helen Coonan seemed to get a tick from the inquiry although after a decade on the board and several years as chair this is surprising," he said.
"Her background is the law and Crown has been not just found to have broken the law on her watch but also committed serious breaches of good corporate governance."
However, Smith noted that it could possibly be seen to be "too disruptive" to completely clear out the board and management. He suggested perhaps she is staying in her position for the sake of the company having some continuity.
"I can see her staying in the job for a period of time, overseeing a renewal of the board and the appointment of a new chief executive, and then after a period of time, making a gracious exit," Smith said.
"There will need to be radical changes in the organisation - more than just a couple of directors and the chief executive - in order for Crown to assuage regulators' concerns. This will likely include significant changes to the share register."
He added that there simply aren't many upsides to Crown's situation right now.
"Crown's outlook is very unclear at present. It doesn't have a licence to operate in Sydney yet and now regulators in Victoria and Western Australia are asking questions about its suitability," Smith said.
WA is poised to push ahead with a Royal Commission style probe into the casino company. Crown said in a statement to the ASX that it would fully cooperate with the inquiry. Coonan commented that she hopes Crown can assist in restoring public and regulatory confidence in its operations.
"Crown's assets are first class but without gaming licences they are just a bunch of fancy hotels and restaurants. I expect it will do whatever it takes to fix this but the path to get there is not clear and it is likely to take some time," Smith added.
A spokesperson for AFCA said: "As chair of AFCA, Helen Coonan has helped to establish a world-class ombudsman service that is free to consumers and small business, and binding on financial firms. During her time as chair, AFCA has assisted over 153,000 Australians to resolve disputes with financial firms, providing over $535 million in compensation to individual consumers and small business owners."
The AFCA spokesperson also pointed to the Independent Liquor and Gaming Authority report, which found that Coonan had relied too heavily on Barton without knowing about his involvement in advocating for the maintenance of certain accounts when ANZ Bank alerted him to money laundering risks.
The report found this "misplaced reliance" on Barton was not a flaw on Coonan's part.
Coonan announced at the AFCA annual general meeting in November that she would not be seeking reappointment in May 2021.
However, that's not enough for the Victims of Financial Fraud (VOFF) group, which is unsatisfied with Coonan's position at the authority.
VOFF and its secretary John Telford take serious issue with Coonan chairing AFCA and Crown.
Given that Crown has been found to have essentially turned a blind eye to money laundering, Telford wondered how Coonan could possibly be fit to chair AFCA and hold the financial sector to account for consumer complaints.
"Chairing Crown and AFCA is much like the start of Matchstick Men staring Nicolas Cage," Telford said.
"Cage's business partner phones a person to say they won a new car. However, the winner must send some money to cover delivery costs. About two days later Cage and partner visit the winner and present themselves as financial regulatory authorities. They say they are investigating the people who run a scam about offering winning cars. They walk away from this visit with the person's bank account details."
Telford said he could not imagine how someone involved with a company accused of money laundering could also be a consumer advocate.