The Star Entertainment Group Ltd (ASX: SGR) share price rocketed higher today despite news that the Queensland police is investigating the casino operator.
The Star Entertainment share price surged 5.9% to $3.40 in morning trade. This makes it the third best performer on the S&P/ASX 200 Index (Index:^AXJO).
It remains to be seen if this is a dead-cat bounce for the beleaguered company. But the rally isn't so surprising as other ASX share laggards have also taken off today.
Embattled ASX shares getting their day in the sun
The problem prone A2 Milk Company Ltd (ASX: A2M) share price tops the leader board with a 7.8% resurgence, while the GUD Holdings Limited (ASX: GUD) share price is the runner up with its 7.1% uplift.
Perhaps investors hunting for deep value ASX shares have been forced to dig in the sin bin.
What these shares have in common is that their share prices have all crashed within the past six months.
Dead-cat bounce for the Star Entertainment share price?
The Star Entertainment share price tumble only started last week when it plummeted over 40%. The panicked sell-off was triggered by reports that management allowed organised crime to use its Sydney and Gold Coast casinos to launder money.
The Queensland attorney-general has asked its police department to officially investigate the allegations, reported the Australian Financial Review.
It's déjà vu for those who remember what happened to the Crown Resorts Ltd (ASX: CWN) share price.
Investigations span two states
At least Star Entertainment shareholders can find comfort that the Queensland Attorney-General Shannon Fentiman has ruled out a royal commission – at least for now.
"The allegations of money laundering and integrity issues are very serious, and the Office of Liquor and Gaming Regulation are undertaking appropriate investigations, along with the Queensland Police and AUSTRAC," the AFR quoted Ms Fentiman as saying.
"The investigation will consider the appropriateness and effectiveness of Star's due diligence processes in relation to anti-money laundering and how the Star approaches exclusions to ensure people are excluded from all properties where appropriate."
Star Entertainment share price troubles only just beginning
It also appears that New South Wales isn't pushing for a royal commission. The NSW Independent Liquor and Gaming Authority will instead undertake a private investigation.
However, the NSW investigation is run by Adam Bell SC. He's the former counsel assisting NSW's Bergin inquiry into Crown Resorts and has the powers of a royal commissioner, according to the AFR.
Foolish takeaway
This means Star Entertainment's casino license in the state could be torn up if Bell thought that was warranted.
Value investors jumping to buy the beaten down Star Entertainment share price will need strong stomachs.
These investigations will take time and Star Entertainment's shareholders are likely to be in for a volatile ride.
