Pokies Thuggery: ClubsNSW lobbyists hammer critics, hide their own dirty laundry

by Michael West | Sep 26, 2022 | Business, Latest Posts

ClubsNSW is dragging a dying man through the courts, and media identity Friendly Jordies too, but its own house is hardly in order. Michael West reports.

The people from ClubsNSW are such sticklers for the law, at least in their own opinion, that they have anointed themselves public prosecutors to drag their critics through the courts.

They are suing a whistleblower dying of cancer, Troy Stolz, and popular YouTube investigator and comedian Jordan Shanks. Not just suing but bringing private criminal prosecutions. Punishment? Gaol-time. They have anointed themselves as police and the Directors of Public Prosecution to boot.

This from the body which represents the biggest gambling revenue in the biggest gambling state in the biggest gambling country in the word; that is, pokies in NSW clubs in Australia. To put it more bluntly, they are the lobby group for a large bunch of casinos responsible for ruining the lives of thousands of Australians.

Their political heft though is palpable. We are talking Victoria, Queensland, Tasmania and South Australia too. But in NSW the clubs’ peak body is particularly offensive, a champion at threatening and muzzling its critics, wasting public money in court actions and generally carrying on as if they are untouchable.

And largely they are; because pokies revenues return billions to the states, and there is no higher return than to the government of NSW. Yet while their army of pokies funded lawyers are demanding court discovery and accountability from those whom they are throttling in the courts, when it comes to producing their own statutory information, their own financial reports, they don’t even bother to respond to repeated media inquiries.

They claim this is “public information” but continue to conceal it behind their Members paywall. You won’t find it at ASIC where most corporate entities file, even the world’s largest multinational companies. You won’t find it anywhere, because they are hiding it.

Hypocrisy, thy name is ClubsNSW 

ClubsNSW describes itself as “the peak representational body for the NSW club industry”. The ClubsNSW Governance Statement is available on their website. ClubsNSW says that it has adopted and complies with the 2nd edition of Company’s Directors’ “Good Governance Principles and Guidance for Not for Profit Organisations”. Really? Is ClubsNSW even in compliance with its own Governance Statement?

On the one hand, ClubsNSW assures us that they employ an “if not, why not” approach to reporting on the Principles, as part of their commitment to transparency and accountability.

On the other hand, the ClubsNSW Governance Statement appears to be a work of satire because ClubsNSW limits access to its annual financial statements on the ClubsNSW website using a Member Login screen.  Applying to become a Member is straightforward if you are a representative of registered club with a liquor licence and an ABN.

For everyone else that might be considered a stakeholder, it appears ClubsNSW operates on the principle “it’s none of your business”.

The following people appear to be deprived of access to the annual accounts of ClubsNSW: (1) employees and creditors of ClubsNSW; (2) patrons and guests of registered clubs; (3) politicians and public servants in government departments; and (4) journalists and members of the public that wish to support organisations that are managed ethically, sustainably and responsibly. 

This deprival is passing strange given that Clause 7.2.3 of the ClubsNSW Governance Statement claims that the audited accounts are “made publicly available through the ClubsNSW website”. 

So what is it? Is it publicly available? Or is it available if you are a club earning millions from pokies as a paying member?

Supporting Practice 7.2 states that the Board of ClubsNSW oversees appropriate reporting to stakeholders about the organisation’s performance and financial position. Governance Principle 7, Accountability and Transparency, states the Board of ClubsNSW demonstrates accountability by providing information to stakeholders about the organisation and its performance.

ClubsNSW compliance with Governance Principle 7 appears to rest on the argument that its stakeholders are limited to Members that are registered clubs. An argument at odds with textbook management of responsible organisations. Good luck to anyone playing the pokies for monetary gain and anyone that wishes to attain a reasonable understanding of the financial affairs of ClubsNSW without access to its annual financial statements. 

Who are these mysterious stakeholders of ClubsNSW? According to clause 8.1.1 of the ClubsNSW Governance Statement the Board has a clear understanding of who ClubsNSW’s stakeholders are. 

What are they hiding?

We might be able to find out these sorts of things if ClubsNSW well funded media department deigned to respond to questions. But no, they simply receive phone calls and emails and don’t bother to respond, at all.

This routine stonewalling led MWM to wonder what ClubsNSW has got to hide in its annual financial statements for the last three years? We can only, out of necessity, speculate. How much income does this so-called not-for-profit entity generate from the Keno for-profit business? How much has the key management personnel compensation grown in recent years? How much government money did ClubsNSW receive during the Covid pandemic?

Fortunately, we did manage to locate the ClubsNSW annual report for 2019 on the web and like the ClubsNSW Governance Statement it was hard to take this document seriously. The front cover of 2019 annual report is emblazoned with words from Invictus written by the one-legged English poet William Ernest Henley. 

It matters not how strait the gate,

How charged with punishments the scroll,

I am the master of my fate

I am the captain of my soul.

Henley would no doubt approve of the Invictus Games for wounded, injured and sick servicemen and women. It is less certain how he would react to ClubsNSW aligning itself with his literary masterpiece.

Nonetheless, Invictus does invoke rich imagery for ClubsNSW. It matters not how bent the business model, the human costs of pokies pushing, the financial cost of money-laundering. We will exploit our financial muscle to decide the fate of others.

What is this anyway?

Given the illusion, or delusion, of Invictus grandeur, it is fair to ask what type of entity is ClubsNSW? It purports to be not-for-profit. It doesn’t appear to be registered as either a company or an association. It does appear to be registered as a State organisation under the Industrial Relations Act, 1996. 

Why does this splendidly profitable enterprise get to enjoy financial anonymity like no others? True, other lobby groups such as the Australian Bankers Association and AI Group have sought to hide their statutory documents, their financial information but none with the clandestine success of ClubsNSW.

An inquiry into the clubs industry, poker machines and ClubsNSW is long overdue.

Troy Stolz, their former compliance staffer who blew the whistle on compliance failures in money laundering is being dragged through the courts. He is dying of bone cancer. He has no whistleblower protection. It is a travesty.

Jordan Shanks is being dragged through the courts too in a private criminal prosecution for interviewing Stolz even though he was not even there. Contempt of court is the charge. ClubsNSW was even awarded a suppression order by the Court so media could not cover proceedings.

What about contempt of Australians?

ClubsNSW, indeed all pokies operations, are wont to cite freedom of choice for Australians to lose their money. Perhaps this is the “master of my fate, captain of my soul” allusion borrowed from William Ernest Henley. Are addicts the masters of their fate or are the lobbyists and their clubs feeding them food and drink to keep them on the pokies the masters?

The lobbyists and the clubs like to boast about investing in the community, helping local sporting clubs and that sort of thing. An investigation by MWM found however that a tiny proportion of clubs pokies revenue, as low as 3% per member, was returned to the community in grants.

Instead, the lion’s share goes to the clubs’ own expansion projects and state governments. And the biggest losers? As this investigation of the top clubs and their businesses shows, the biggest losses are overwhelmingly in the poorest demographics of Western Sydney. Is there any other business more exploitative than this?

Pokies: the Rise of the Machines

 

Latest questions put to ClubsNSW for no response: 

Dear Michelle,

I called the media phone line and spoke to a media person but there has been no response. So, here is my inquiry.

  1. Could you please send through a copy of ClubsNSW most recent financial statements? Although Clubs claims it is public information, the document is apparently hidden behind the Members paywall.
  2. According to your Governance Statement, “7.2.3 The audited accounts are published in an Annual Report distributed to Members and made publicly available through the ClubsNSW website”.  How can the claim be made that the accounts are publicly available if members of the public who are not members of Clubs cannot access them?
  3. Who are the “stakeholders” referred here in the Governance statement? “8.1.1 The Board has a clear understanding of who ClubsNSW’s stakeholders are, their relationship to the organisation and value to the pursuit of the organisation’s purpose, and what responsibilities we have to them.

Michael West established Michael West Media in 2016 to focus on journalism of high public interest, particularly the rising power of corporations over democracy. West was formerly a journalist and editor with Fairfax newspapers, a columnist for News Corp and even, once, a stockbroker.

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