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Inquiry into Crown Resorts’ Melbourne casino widened to consider more allegations

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SYDNEY — Crown Resorts Ltd. is facing additional scrutiny into its business practices after Australia’s Victoria state widened an inquiry into its suitability to hold a casino license.

The Victoria state government on Friday said the move will allow the so-called Royal Commission investigating the company’s Crown Melbourne casino to look at a wider range of matters, including corporate culture, protection of vulnerable gamblers and allegations of underpaid casino tax.

The state has also extended the deadline for the quasi-judicial inquiry to Oct. 15 from Aug. 1. and nearly doubled the funding for the investigation, which was opened in February amid disquiet over the group’s business practices.

“We established this Royal Commission to get the answers we need about Crown and this extension will ensure the scope of evidence provided so far is able to be thoroughly considered,” Victorian Acting Premier James Merlino said.

Crown Executive Chairman Helen Coonan said the company will address any shortcomings identified by the commission.

The extension is the latest blow to Crown CWN, -0.08%, which is facing multiple investigations from Australian authorities. This week Crown said its Melbourne complex breached state law by allowing international gamblers to deposit funds with debit or credit cards, and that the federal government’s financial intelligence agency was looking into a potential breach of money-laundering laws at its casino in the west-coast city of Perth.

Its new skyscraper on Sydney’s waterfront has also been the subject of a long-running approvals process by the gambling regulator in New South Wales state, which found that Crown disregarded the welfare of its employees by pursuing high-rollers in China.

The uncertainty has led to interest in Crown, which is 37%-owned by Australian billionaire James Packer through his investment company, Consolidated Press Holdings.

Last month, Crown rejected an improved takeover offer from U.S. private-equity firm Blackstone Group Inc. BX, -0.77%, saying the proposal undervalued the company and presented too much regulatory uncertainty. It has also asked Australian rival Star Entertainment Group Ltd. SGR, +1.37% for more information on a merger proposal that Star made in May.

Shares in Crown are down 3.0% at A$12.03.

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