MELBOURNE, AAP – Crown Melbourne’s chief knew the company may have underpaid more than $200 million in gaming tax for years, but only looked into it after a royal commission was announced.

Giving evidence on Monday before the inquiry into whether Crown retains its Melbourne licence, chief executive Xavier Walsh revealed he learned in June 2018 the casino hadn’t told Victoria’s gaming regulator it may have been underpaying tax by claiming as losses promotions handed out through its pokies loyalty program.

The practice existed since at least 2012, with documents saying it wouldn’t be “noticed” by the Victorian Commission for Gambling and Liquor Regulation.

While Mr Walsh said this raised a red flag, he didn’t ask anyone to check how much unpaid tax the James Packer-backed group may owe until February 24 this year – two days after the inquiry was announced by the state government.

Commissioner Raymond Finkelstein QC lashed Mr Walsh for his inaction.

“It couldn’t have bothered you that much – because you did nothing,” Commissioner Finkelstein said.

“I’m trying to come to grips with why you did nothing since 2018. I need an answer to the question.”

Mr Walsh said he “took comfort” knowing that senior management at Crown Melbourne knew about the issue.

Commissioner Finkelstein was not convinced.

“This deception was known to many people in the organisation and it didn’t seem to trouble anyone,” he said.

Commissioner Finkelstein later said illegal conduct “permeates the whole organisation” and he was “troubled” by Mr Walsh’s repeated framing of the tax issue as a “historical” or “legacy” problem.

“There is nothing historical about it all – I don’t understand why you keep putting it as a thing of the past,” the former Federal Court judge said.

“You’re still calculating tax on the same basis … this is not five years old or 10 years old, it is current.”

Mr Walsh said he asked Crown’s executive general manager of gaming machines, Mark Mackay, to calculate the firm’s potential tax underpayments on February 24.

This, he said, had followed a “strident” push in late 2020 by Crown Resorts’ chair, Helen Coonan, to change the firm’s culture.

But counsel assisting Adrian Finanzio SC put to Mr Walsh the royal commission, announced on February 22, was the real catalyst.

“It was that which prompted you – rather than Helen Coonan’s ‘broad invitation’ to change the culture,” Mr Finanzio asked Mr Walsh.

Mr Walsh said Ms Coonan had asked him, in a February 23 meeting, to “bring out your dead”, referring to the 1975 movie Monty Python And The Holy Grail.

“Do you sit here now and say you honestly believe Crown did not cheat on its taxes?” Mr Finanzio asked Mr Walsh.

“I think there’s potential that we have,” he responded.

Mr Finanzio later said the only reason Crown’s potential gaming tax underpayments – which the inquiry has heard could be as much as $272 million – came to light was because Mr Mackay “inadvertently” included a spreadsheet in his evidence.

Mr Walsh claimed the firm would have likely raised this “unresolved issue” after the royal commission, which was set up following a NSW inquiry that found Crown unsuitable to operate its newly built casino in Barangaroo.

The inquiry continues on Tuesday.