The Bell inquiry into Star heard on Thursday the casino disguised $900 million in transactions from China Union Pay as hotel expenses to help guests dodge controls over using the money for gambling.

Former group treasurer Sarah Scopel took to the witness box on Friday morning facing questions on her role in potentially misleading communications with National Australia Bank, CUP and staff that the transactions were being used for gambling.

She was shown one email drafted in late 2019 with input from chief financial officer, Harry Theodore, and general counsel, Oliver White, telling NAB – which was representing CUP – that the transactions were non-gaming related because they were not made in the gaming area of Star.

“At the time I understood there was technical reasons that we could make this statement but with the benefit of hindsight I would agree that this statement was false,” Ms Scopel said.

But she didn’t believe she was in a position to challenge either of her bosses.

“It could impact my employment,” Ms Scopel said.

Star offered to limit the size of transactions being made after CUP staff said they were trying to understand how one customer spent $20 million on non-gaming entertainment.

In 2020 staff were told the CUP terminals could no longer be used to top up guest’s hotel accounts due to “increased administration”.

Scopel agreed that was also misleading but it “ultimately” meant the CUP terminals were not being used to fund gaming.

“I didn’t think the purpose of stopping this operation was relevant,” she said.

The NSW Independent Liquor & Gaming Authority inquiry is investigating whether The Star Sydney has been infiltrated by criminal activity such as money laundering, and if it is fit to keep its casino licence, following highly critical media reports.

Also due to testify on Friday is the casino’s head of diversified industries and technology Tanya Arthur.

The inquiry was sparked by reports accusing The Star’s owner, casino giant Star Entertainment, of enabling suspected money laundering, organised crime, fraud and foreign interference at its gaming facilities.

Those reports will be “directly relevant” at the week-long hearing, with the casino’s due diligence processes also expected to be put under the microscope, along with alleged links to “politically exposed” individuals.

Among witnesses scheduled to appear next week is Chinese billionaire property developer Phillip Dong Fang Lee, who was reportedly a high roller at the casino.

Star Entertainment says it has an unwavering focus on preventing criminal activity at its casinos, which also include The Star Gold Coast and Treasury Brisbane.

Its larger rival, Crown Resorts, has also faced misconduct inquiries, which found criminals were taking advantage of its casinos, prompting two royal commissions and the resignation of most of its board.