SkyCity gets regular, annual compliance check-ups. Photo / Michael Craig
SkyCity gets regular, annual compliance check-ups. Photo / Michael Craig
Local authorities are investigating how SkyCity Entertainment Group’s New Zealand operations are fighting money laundering and terrorism financing as part of an ongoing series of audits.
Te Tari Taiwhenua The Department of Internal Affairs is conducting its regular analysis of the casino business.
The domestic audit is unrelated to SkyCityAdelaide being sued by Australian federal financial intelligence agency Austrac after allegedly allowing nearly A$4 billion to be laundered through that riverside casino from late 2016.
That case is yet to be heard but Austrac announced it lodged a statement of claim in court on Wednesday.
The New Zealand Government department didn’t refer to that when a response was sought about compliance in this country.
Caroline BridglandHill, department regulatory services general manager, said the New Zealand audit was ongoing and part of regular analysis of the casino operator’s legal requirements.
A SkyCity spokesman said today: “The DIA conducts frequent audits of all SkyCity sites and on-site visits to monitor compliance with anti-money laundering, host responsibility and other obligations each year. SkyCity cooperates fully with DIA in relation to these ongoing audits.”
The Herald asked the department if it had concerns, especially when the Federal Court of Australia claim alleged money had been moved from some gamblers’ SkyCity accounts in New Zealand to Australia.
The Austrac lawsuit contained a section called “the New Zealand channel” explaining how that was allegedly done.
BirdglandHill said it was too early to say what the outcome would be.
Riverside, SkyCity Adelaide where the company built a huge new hotel. Photo / Supplied
“The Department of Internal Affairs carries out a range of regulatory activities to help ensure understanding of and compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2009 ranging from education through to enforcement,” she said today.
Such activities happened frequently, including on site-inspections where appropriate. The latest on-site inspection began in September.
“The intent of this is to ascertain SkyCity’s current compliance with its obligations under the AML/CFT. Because our inspection is current and ongoing, we are unable to make any further comment on that matter,” she said.
The law here obliged New Zealand’s financial institutions, casinos, virtual asset service providers, accountants, lawyers, conveyancers and high-value dealers to detect and deter money laundering and terrorism financing.
It is to ensure businesses take appropriate measures to guard against money laundering and terrorism financing. That enhances the reputation of individual businesses and of New Zealand as a safe place in which to do business, the department says.
Michael Ahearne, SkyCity Entertainment Group's chief executive. Photo / Peter Meecham
Michael Ahearne, SkyCity chief executive, said earlier this week: “Providing a safe and responsible environment for our customers and communities is a priority for us.”
He said SkyCity took its anti-money laundering obligations seriously and was committed to enhancing its processes.
“We will continue to work with all our regulators on the ongoing enhancements of our anti-money laundering/counter-terrorism financing programmes,” Ahearne added.
Jarden senior analyst Adrian Allbon this week released research questioning if a New Zealand investigation would be launched in response to Austrac.
Allbon said the key question after Austrac laid charges on Wednesday was the magnitude of the fine and any potential “contagion” where the Kiwi regulator sought to undertake a similar review for New Zealand properties.
Allbon said the statement of claim filed showed SkyCity faced 124 contraventions for customer due diligence failures.
Those were 59 alleged breaches for providing services for customers at high risk of money laundering/terrorism financing (ML/TF).
Austrac claimed another 65 were for facilitating transfers of money from third parties in and out of Australia via SkyCity New Zealand casino accounts, bypassing the traditional banking system and which involved higher ML/TF risks.
Austrac’s case is that SkyCity Adelaide allegedly allowed customers to spend “dirty money” that appeared to have been wet and previously buried, according to documents lodged in the Federal Court of Australia this week.
Customers posing a high money laundering or terrorism financing risk engaged in big-time cash transactions, allegedly using cash in plastic bags, garbage bags, and cash bundled with rubber bands or irregular straps.
Austrac is suing the casino operator for “serious noncompliance” with anti-money laundering laws and failing to monitor telltale signs of money laundering.
This is Austrac’s third live civil court case against a casino group this year, after cases against Australia’s Crown Resorts and Star Entertainment.
Court documents claimed a SkyCity Adelaide cashier struggled to count notes which appeared wet or dirty and a customer “engaged in large and unusual transactions and patterns of transactions which had no apparent economic or visible lawful purpose”.
Austrac alleged some transactions involved large amounts of cash and cash that appeared wet and dirty, and the casino exchanged those dirty notes for cash chips.
The regulator accused the Adelaide casino of making little effort to know its customers who were pumping millions of dollars through its systems.
Austrac alleged SkyCity Adelaide allowed in gamblers whose jobs didn’t match the amount they spent.
“Customer 32″ listed his occupation as a truck driver yet he gambled more than A$44 million at SkyCity Adelaide.
He went there for years between December 2016 and last August, according to charges laid this week in the Australian Federal Court, and the mismatch between his occupation and his gaming turnover should have raised red flags, it’s alleged.
