The Star Entertainment Group Ltd (ASX: SGR) share price is faltering today and is currently down 4.98% at $3.15.
Star has been trading in a range of $3.08 to $3.24 today, despite no market-sensitive information being released by the company.
However, a public hearing into Star’s casino licence heard on Thursday that the group allegedly disguised $900 million worth of Chinese debit gambling transactions and then concealed these to banks.
As The Sydney Morning Herald reported yesterday, the NSW Independent Liquor & Gaming Authority launched a review into Star’s casino licence in 2021 after reports surfaced alleging acts of money laundering and fraud at its venues.
As a result of the negative momentum lately, Star shares are now trading at 52-week lows at the time of writing.
What’s happening with Star today?
While the reporting isn’t designed to induce Star share price fluctuations in any way, investors certainly don’t appear to be impressed with Star today.
On Thursday the inquiry heard how Star supposedly transferred money to the patrons’ gambling accounts, after payments were made from UnionPay bank cards at hotels attached to casinos in Sydney, Brisbane, and the Gold Coast.
According to the SMH, counsel assisting hearing, Naomi Sharp, SC, alleged that about $900 million had been processed through the elaborate scheme.
Ultimately this “left it open to money laundering, breached The Star’s merchant agreement with its bank (NAB), and potentially provided a way for patrons to evade China’s tight capital controls,” it says.
In response to the media reports, The Star released a statement today saying it is fully cooperative, but there were no rebuttals to claims made in the article written by the SMH.
“The Star Entertainment Group refers to the various media reports regarding evidence provided in the public hearings in connection with the review of The Star Sydney being undertaken in accordance with the Casino Control Act 1992 (NSW) by Mr Adam Bell,” it said.
“As the review is ongoing, The Star does not consider it appropriate at this stage to comment on matters which remain before the review and which will be considered in that process”.
Curiously, the statement was authorised by “a majority” of the board of directors, with no citation of full board approval to be found.
Star share price snapshot
In the last 12 months, the Star share price has crept to a loss of 19%. It is also down 15% this year to date.
Shares have fallen 11% over the past month and almost 7% dunk this week.
The post Why is the Star Entertainment (ASX:SGR) share price slumping to fresh 52-week lows? appeared first on The Motley Fool Australia.
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Motley Fool contributor Zach Bristow has no position in any of the stocks mentioned. The Motley Fool Australia’s parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.
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