New Zealand’s SkyCity Entertainment said the country’s Department of Internal Affairs (DIA) has applied to temporarily suspend the license of its SkyCity Casino Management (SCML) unit. Following the development, the casino operator’s shares fell 18.5% or by NZD 1.900 ($1.130), which hit their lowest level since April 8th, 2020.
After SkyCity Entertainment shared the news with its investors, its value was wiped off by over $154.3 million, as per the Australian Financial Review. SCML is SkyCity’s license holder for its casinos in Auckland, Hamilton, and Queenstown regions in New Zealand.
According to SkyCity, the application was made to the country’s gambling commission to suspend the unit’s casino operator license for a “range of 10 days” in response to a complaint made early last year by a former client who played at the SkyCity Auckland casino between August 2017 until February 2021.
“The Secretary (of the DIA) states in the application that SCML did not comply with requirements in its SkyCity Auckland Host Responsibility Programme relating to detection of incidences of continuous play by the customer,” SkyCity said in a statement.
The company also noted potential suspension would not impact non-gaming operations such as hotels and restaurants, and that a decision could take months. It also stressed that it would fully comply with the DIA during the investigation.
SkyCity Hamilton
“SkyCity will fully cooperate with the secretary in relation to the application and process,” the company said in a statement. “Given the application is before the commission it would be inappropriate for SkyCity to comment further on the application and allegations at this stage.”
Reuters cited the DIA, which confirmed that it had recently completed an investigation into SkyCity’s gambling harm-minimisation practices. “The Secretary believes SkyCity has breached important harm-minimisation obligations including conditions of its license and conditions of its Host Responsibility Programme relating to instances of long-play by its customers,” John Sneyd, general manager – of regulatory services, said.
Last year, Australia’s financial crime regulator launched civil proceedings against SkyCity’s casino in Adelaide to crack down on the gambling industry. The company is facing a South Australian probe into whether it is fit to hold a license in Adelaide.
Earlier this month, the operator announced that it has set aside a substantial sum of AU$45 million (USD 29M) to potentially cover a civil penalty resulting from an anti-money laundering case being heard in the Federal Court.
The legal issue stems from action taken by the Australian Transaction Reports and Analysis Centre (AUSTRAC), which brought the case against SkyCity in December. AUSTRAC alleged systematic non-compliance with anti-money laundering and counter-terrorism financing laws.
