SYDNEY (REUTERS) - Australia's Victoria state said on Monday (Feb 22) it would hold a royal commission inquiry into casino operator Crown Resorts and its fitness to hold a gambling licence, extending the fallout since the media accused it of ties to money laundering.

A week and a half since another state regulator found Crown unfit for a gambling licence for a just-opened casino in Sydney, the Victorian government said it would hold its own probe.

A royal commission is Australia's most powerful type of public inquiry and has the power to compel witnesses.

"Establishing a royal commission will ensure the most appropriate access to information regarding Crown Melbourne's suitability to hold the casino licence given the commission's powers to compel witnesses and documentation," Victorian Premier Daniel Andrews said in a statement.

Crown said in a statement that it welcomed the commission as a chance to detail how it will reform its business and that it would fully cooperate.

"Victorians should be assured we recognise the responsibility placed on us by the community, governments and regulators and we will fully cooperate with the Royal Commission," said Ms Helen Coonan, Crown's executive chairman.

It also separately said on Monday that director Harold Mitchell, an advertising industry veteran, had quit its board, following a host of other top executives, including its CEO, to leave since the Sydney report.

The Victorian inquiry would be the third state inquiry into Crown since Australian media reports accused the company one-third owned by billionaire James Packer of doing business with tour operators with ties to organised crime.

Crown initially denied the allegations but admitted at the Sydney inquiry in 2020 that some of the claims were true.

The Western Australian state government also said last week it would hold an inquiry into Crown, which has a casino in the city of Perth.

Crown's Melbourne casino is its biggest revenue source since the company quit its offshore interests following the mass arrest of its staff in China in 2015 for breaching laws banning the marketing of gambling holidays.

The company's Sydney casino opened in December with restaurants, bars, hotel rooms and luxury apartments but not with gambling since that state regulator suspended its licence due to the inquiry.