New Zealand-based casino group SkyCity (ASX:SKC)
has informed both the NZX and ASX that it faces the possibility of losing its casino licences in the country for a period of 10 days. This startling announcement led to a 17% sell-off of shares on the ASX during Monday's trading. The company's statement revealed that the NZ Department of Internal Affairs had informed them of an application to suspend their casino operator's licence for approximately 10 days. By the close of trading, the shares had fallen around 14%.
The license suspension pertains to SkyCity Casino Management's licences for its Auckland, Hamilton, and Queenstown casinos. The Gambling Commission will now review whether to issue an order for the licence suspension and determine its duration.
The situation arose following a complaint from a former customer who had gambled at the casino from August 2017 to February 2021. In the statement provided to the exchanges, SkyCity explained that the application stated the company had not complied with the requirements of its Sky City Auckland Host Responsibility Programme related to identifying instances of continuous play by the customer.
SkyCity expressed its commitment to fully cooperate with the application and the ensuing process. The company also noted that due to the ongoing application before the commission, it would be inappropriate for them to provide further commentary on the allegations at this stage.
This incident marks not the first regulatory challenge SkyCity has faced concerning its casinos. The company is currently under investigation for potential money laundering issues related to its Adelaide casino. The investigations involve AUSTRAC, the federal government's financial intelligence regulator, and a separate probe by the South Australian Liquor and Gambling Commission.
Last month, SkyCity revealed that it had engaged an independent expert to assess the casino's enhanced anti-money laundering and anti-terrorism programs, including their implementation and effectiveness. This move follows a pause in a South Australian government-commissioned independent inquiry prompted by AUSTRAC's December 2022 allegations against the Adelaide casino and SkyCity regarding the adequacy of their anti-money laundering and anti-terrorism programs.
These developments are part of a broader scrutiny of anti-money laundering and anti-terrorism financing regulations, which have been the subject of investigations and independent inquiries involving other major casinos, including Crown Casino's Perth, Melbourne, and Sydney locations, as well as Star's Sydney, Brisbane, and Gold Coast casinos.