The NSW Independent Liquor and Gaming Authority decided on Wednesday to withhold approval for gaming at the flagship Barangaroo facility until the recommendations of an extraordinary probity inquiry into Crown's fitness to run the casino are delivered in February 2021.

ILGA chair Philip Crawford said in a statement that ILGA had found the inquiry's evidence to be "extremely concerning" and that allowing gaming activity to occur before it could consider the inquiry's report would pose "unacceptable risks".

The authority had resolved that it was not in a position to consider a range of essential regulatory applications on matters such as minimum bet limits, VIP membership policy, gaming area boundaries and "close associates" of the licence holder.

Mr Crawford told a press conference that that he was concerned Crown had potentially enabled crimes like drug trafficking, child exploitation and terrorism financing by allowing money to be laundered through its accounts.

"When we talk about money laundering, what does that really mean? It basically means proceeds of crime," he said.

However, the ILGA was prepared to work with Crown to explore options to enable the opening of non-gaming areas including accommodation, restaurants, bars and entertainment areas next month.

The decision followed Crown's bombshell admission on Wednesday morning that dirty cash had probably been laundered through its bank accounts.

Crown-commissioned expert reports examined two of Crown's accounts and concluded that "more likely than not" money laundering had occurred.

Inquiry commissioner Patricia Bergin criticised Crown for serving the reports on the inquiry at 11pm on Tuesday without notice. While Crown has argued that many of its problems are in the past, the fact that it delivered the reports so late revealed a "present problem ... (with) ramifications of the most serious kind", Ms Bergin said.

Ms Bergin suggested Crown had wasted taxpayers' money by allowing the inquiry to proceed for so long before the company conceded there was enough evidence that money laundering took place.

She hinted she would demand legal advice provided to Crown by Minter Ellison that may have suggested the company avoid reviewing media allegations that the accounts were used for money laundering.

Crown's barrister Neil Young QC accepted "unreservedly" that the company should have followed the recommendation of its former head of anti-money laundering to conduct a full review of the accounts in August 2019.

Mr Crawford said in his press conference the late delivery of the reports showed that Crown's board was not "picking up the vibe" of the inquiry.

Mr Crawford confirmed that Crown's ability to ever open the casino hangs in the balance as the inquiry proceeds. Counsel assisting the inquiry have recommended Ms Bergin find that Crown's subsidiary is not suitable to hold the casino licence.

Earlier on Wednesday, Mr Young argued that Crown could not be blamed for any flaws with an agreement by billionaire James Packer's private company to sell 19.99 per cent of its shares to Hong Kong firm Melco Resorts in May 2019.

The company did not know about the transaction and had no power to stop it, he said.

Mr Crawford appeared sceptical of the argument on Wednesday.

"The Melco transaction obviously required our approval and we were not consulted," he said.

Crown suspended trading in its shares ahead of ILGA's announcement.

It will be able to open other parts of the facility like bars, event spaces, and a hotel.

The inquiry continues on Thursday.

Australian Associated Press