Gambling authority moves ahead of stalled review to appoint independent monitor to SkyCity Adelaide

The South Australian gaming authority has moved ahead of the findings of a review of SkyCity Entertainment Group’s (ASX: SKC) casino licence by ordering the New Zealand-based company to appoint an independent monitor to oversee anti-crime and corruption programs at its Adelaide casino.

The move comes amid an extended delay of South Australian gaming regulator Consumer and Business Services’ investigation into SkyCity, which was announced following the fallout from multiple inquiries by interstate authorities into the operations of Crown Resorts and The Star Entertainment Group (ASX: SGR) over the past two years.

Liquor and Gambling Commissioner Dini Soulio has directed SkyCity Adelaide to appoint a ‘suitably qualified independent expert as the independent monitor’ to review the casino’s anti-money laundering and counter-terrorism financing (AML/CTF) programs. The independent expert will also monitor SkyCity Adelaide’s implementation of these programs.

The Consumer and Business Services review of SkyCity’s Adelaide casino licence was put on hold in December last year, just six months into proceedings, after Australia’s financial crime watchdog AUSTRAC launched civil penalty proceedings in the Federal Court against the casino operator.

At the time, AUSTRAC deputy CEO Peter Soros said the investigations into SkyCity had uncovered ‘systemic failures’ by the casino in its approach to AML/CTF obligations.

Soulio says he has now called for the independent monitor to be appointed to SkyCity following ‘careful consideration of issues’ uncovered by AUSTRAC’s against SkyCity Adelaide by AUSTRAC in the Federal Court’ as well as preliminary materials from the Brian Martin KC’s review of licence suitability ordered by Consumer and Business Services.

“After evaluating all the material and considering SkyCity Adelaide’s responses to my concerns, I feel it is appropriate for SkyCity Adelaide to demonstrate it is meeting these important regulatory obligations,” Soulio says.

The independent monitor will have authority to call for amendments to SkyCity’s enhancement programs if dissatisfied with them, before they are considered and approved by the Liquor and Gambling Commissioner.

“This is not a matter that I have taken lightly,” Soulio says.

“I believe it’s important that the people of South Australia can have confidence that SkyCity Adelaide, as the licensee of the Adelaide Casino, is operating effectively to minimise gambling harm and ensure compliance with all anti-money laundering and counter-terrorism financing regulatory obligations.”

SkyCity says it has been advised that the mandatory appointment will provide an ‘independent perspective of SkyCity Adelaide’s AML/CTF and host responsibility enhancement programs and an additional layer of insurance’.

“SkyCity and SkyCity Adelaide will continue to co-operate with Consumer and Business Services and any further requests for information and documents,” the company says in a statement to the ASX.

Soulio notes that the independent monitor ‘will not displace the role of the SkyCity Adelaide board’ but will monitor SkyCity's program implementation and operations to ensure compliance objectives are met.

The Liquor and Gambling Commissioner has yet to select a candidate to become the independent monitor but says he will work with SkyCity Adelaide in relation to the selection and appointment process.

Meanwhile, the independent investigation into the suitability of SkyCity Adelaide to hold a casino licence in South Australia will stay on hold pending the outcome of AUSTRAC’s Federal Court action.

“As the AUSTRAC proceedings are ongoing and are currently before the court, it would be inappropriate to comment further at this point,” Soulio says.

The move by the Liquor and Gambling Commissioner mirrors those of the NSW and Queensland gaming authorities which each appointed an independent manager to oversee the implementation of AML/CTF programs at The Star’s casinos in Sydney, Brisbane and Gold Coast respectively.

A special manager was also appointed at Crown Melbourne early last year following the findings of the Victorian Royal Commission into casino operator Crown Resort’s operations.