It’s been a bad week for James Packer in Asia, both for his existing casino businesses in Macau — the biggest gambling centre in the world — and for his future prospects in Japan, potentially the region’s number two casino market. In fact it’s been a bad year all round for Australia’s favourite, sorry, only gambling magnate — and it’s only going to get worse.

These days the industry prefers to call casinos “integrated resorts”, a reference to the hotels, shopping malls and entertainment complexes now attached to them and pioneered by Las Vegas. But let’s call a spade a spade, as they do on the casino gaming tables.

One could go step a further and call them laundromats, places where ill-gotten gains are cleaned and polished so the money in suitcases coming out their front doors looks, for all the world, like hard-earned cash — some of it undoubtedly headed for the property market in Australia and elsewhere. As such, Macau, which last year produced gambling revenues seven times as big as Vegas, is the world’s biggest laundry. It’s the only place in China where gambling is legal.

It’s this aspect, the laundering of money, that appears to be behind the biggest monthly year-on-year fall in gambling revenues in Macau since comprehensive figures were first compiled in 2005. Gambling revenues in Macau plummeted by 22% in October compared to a year earlier — the fifth consecutive monthly fall — and the trend is accelerating.

The unanimous view among those who dissect the sector, and the stock-market-listed companies that derive their profits from it, is that the prime driver for this is simple: the ferocious and unprecedented anti-corruption campaign, known as Operation Fox Hunt, being conducted by Chinese leader Xi Jinping and his right-hand man and childhood friend Wang Qishan, head of the Chinese Communist Party’s Central Commission for Discipline Inspection. A similarly bleak outlook is predicted for 2015 with the Party’s crackdown on illegal money transfers, tighter restrictions on visas and the protests in Hong Kong all posing significant threats to Macau’s gaming revenues, especially from VIP gamblers.

In Macau Melco Crown, a joint venture between James Packer and Lawrence Ho — scion of Hong Kong’s Ho family, led by billionaire Stanley Ho, which once held a monopoly on gambling in Macau — runs two casinos: Altira and City of Dreams. It is about to add the soon-to-open City of Dreams Manila and another casino, Studio City, also in Manila, next year.

In third-quarter results announced yesterday, Melco Crown’s revenues and earnings were down 10% compared to the same period last year. Net income fell from US33 cents per share in last year’s third quarter to US24 cents for Q3 this year. In response, Melco Crown’s American Depository Receipts have fallen from $35 to $25 in the past 12 months, wiping $4 billion or so from its market capitalisation and putting a sizeable dent in the Packer fortunes.

“Packer must be very relieved that he managed to pocket the licence for Sydney’s second casino … The Philippines aside, this dedicated high-roller facility now appears to be the only growth business in his gambling portfolio …”

What’s more, prosecutors in Taiwan alleged in August that Melco Crown’s subsidiary MCE International transferred more than NT$5.4 billion ($194 million) in deliberate violation of foreign exchange controls on behalf of high-rollers looking to gamble at Melco Crown’s City of Dreams and Altira casinos.

“The illegal conduct of the defendant MCE International and the other defendants is suspected to have harmed this country’s financial order,” the Taipei District Prosecutors Office said.

The transfers took place between July 2009 and January 2013 when Crown Limited’s chief executive Rowen Craigie was a director of MCE International. Melco has promised to “defend vigorously any indictment” and said it believes its “operations in Taiwan are in compliance with Taiwan laws”.

Packer and Ho have been pressing the flesh quite a bit this year in Tokyo, too. They are still considered to have an outside chance of grabbing one of possibly only two casino licences that will be offered as part of Prime Minister Shinzo Abe’s plans for the 2020 Olympics. But even those plans are on hold; legislation due to be passed before the diet rises on November 30 has been put on ice as Abe has been distracted by serial cabinet corruption scandals. Still, Tokyo insiders expect it will eventually pass in the first half of next year. With Macau in the doldrums, however, competition will be white hot and the Taiwan writ won’t do Melco Crown any favours if it hangs around.

Melco Crown is also eyeing a casino in the dictatorial nation of Sri Lanka.

On the face of it, Packer must be very relieved that he managed to pocket the licence for Sydney’s second casino before his patron, former premier Barry O’Farrell, fell on his sword over the famous forgotten bottle of Grange Hermitage. The Philippines aside, this dedicated high-roller facility now appears to be the only growth business in his gambling portfolio in the medium term but perhaps not as good a money printing machine as Packer may have initially thought. And he needs it, with shares in his Australian-listed Crown resorts also tumbling from $17.84 in January to below $14 this week, a nasty tumble and another chunky dent in the fortune.

And while the ocean is wide and the emperor far away — to twist an old Chinese saying — Packer’s Australian business could yet be caught up in Xi’s campaign.

As canvassed in Crikey earlier this week, the Australian Federal Police are assisting the Chinese Communist Party in Operation Fox Hunt, designed to capture corrupt Chinese officials and their dirty money. The feds would do well to take a good hard look at who is playing the tables, especially in the high-roller rooms, at Packer’s Casinos in Melbourne and Perth, as well as Australia’s other legalised gambling dens in the other state capitals and Darwin.

Such attention may see revenues — already more or less flatlining as the Australian economy begins its nosedive — in those places take a similar trajectory to those in Macau and could spell even more bad news for Packer. Still, there’s always the Philippines — a country that’s certainly no friend of Beijing these days — for high-rolling Chinese officials.

So the Macau goldmine has lots its lustre for now and while O’Farrell, like generations of Australian politicians, proved putty in the hands of the Packer family, Xi and Wang may be a little less easy to sway.