SkyCity Casino Set to Lose its Gambling Licence

SkyCity Casino Set to Lose its Gambling Licence
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New Zealand’s Department of Internal Affairs has asked the Gambling Commission to temporarily suspend SkyCity Casino Management Limited’s licence for breaching their duty of care rules.

Let’s look at the breach and the potential impacts for SkyCity.

Complaints of Host Responsibility

Last February, a formal complaint was lodged by a former customer of SkyCity Auckland. The customer was said to have gambled at the casino between 2017 and 2021.

The Department of Internal Affairs (DIA) alleges that the casino breached its harm-minimisation obligations. In the application, the DIA states that SkyCity Casino Management Limited failed to comply with requirements in its Adelaide casino host responsibility programme related to detecting incidences of continuous play by a customer.

The DIA is seeking a temporary suspension of the casino operator licence for all of its New Zealand-based casinos for a period of approximately 10 days.

Next Steps for the NZ Gambling Commission

It’s unlikely the Gambling Commission will make a decision for several months, with SkyCity intending to also lodge an application to the regulator.

The decision about licensing will then be up to the commission, who will review the circumstances of the case to determine what action is appropriate.

The Impact for SkyCity

The potential suspension is already impacting share prices, wiping almost $180 million off SkyCity’s market capitalisation. The group has not made any formal announcements, besides stating that any suspension will not affect any of the operator’s restaurants or hotels.

If the licence is suspended, it could mean short-term financial losses for the casino, along with reputational damage that could have long-term financial impacts.

A market update read;

SkyCity is committed to maintaining the highest standards of host responsibility best practice, with priority given to minimising the impacts associated with problem gambling as an area of primary focus.

The company has already made significant investments into systems to help ensure and maintain the highest standards of host responsibility best practices. This includes taking steps to prioritise minimising the impacts associated with problem gambling.

Other Issues Facing the Group

SkyCity is also under scrutiny by Australian authorities in its Adelaide casino. The Australian Transaction Reports and Analysis Centre (AUSTRAC) formally launched legal action against SkyCity’s Adelaide casino in December last year.

An investigation identified serious and systemic issues of non-compliance with anti-money laundering (AML) obligations. SkyCity has set aside approximately $50 million AUD for potential penalties.

About SkyCity

SkyCity Casino Management Limited is a wholly-owned subsidiary of SkyCity Entertainment Group Limited. They hold casino operator’s licence for all of SkyCity’s New Zealand casinos, located in Auckland, Queenstown and Hamilton.

The group has stated they intend to fully cooperate with the DIA.

About the Department of Internal Affairs

The DIA is responsible for serving and connecting people, communities and government. Their goal is to create a safe, prosperous and respected nation.

The department takes gambling harm minimisation seriously and takes action against licensed operators who don’t abide by the conditions of their licences. They regularly conduct audits and monitor New Zealand casinos, ensuring all operators fulfil their responsibilities and obligations.

In addition to gambling, the department is also responsible for community development, online safety policy, identity and ethnic communities (among other policy areas).

References:

  • Newstalk ZB. “SkyCity’s NZ share price plunges, casino licences could be suspended”, https://www.newstalkzb.co.nz/news/business/skycity-s-nz-share-price-plunges-casino-licences-could-be-suspended-174m-wiped-out/
  • InDaily. “SkyCity NZ casinos threatened with shutdown”, https://indaily.com.au/news/2023/09/04/skycity-nz-casinos-threatened-with-shutdown/
  • NZ Herald. “SkyCity’s NZ share price plunges, casino licences could be suspended”, https://www.nzherald.co.nz/business/skycitys-nz-casino-licences-could-be-suspended-if-new-internal-affairs-bid-succeeds/VERRAD2J7NBQJJWH5RKAN4GDKU/
  • Department of Internal Affairs. “About Internal Affairs”, https://www.dia.govt.nz/About-Internal-Affairs
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Oliver Jones
Oliver Jones
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Oliver Jones is a seasoned journalist with a specialty in the iGaming sector. With a robust background that marries 11 years in mainstream journalism with 4 years dedicated to the online casino industry, Oliver provides a unique blend of relevant news and insightful analysis.

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