SkyCity settles AML case with New Zealand DIA

• Industry News
• 22. 05. 2024.
• Jelena Radisavljevic

SkyCity Entertainment Group has agreed with the New Zealand Department of Internal Affairs (DIA) after breaking the rules meant to prevent money laundering and the funding of terrorism.

In February, the New Zealand Department of Internal Affairs (DIA) announced it would sue SkyCity and its subsidiary for not following anti-money laundering and counter-terrorism financing laws.

The DIA listed five major compliance issues, seen as serious breaches. SkyCity said these issues were mostly historical, and some were self-reported. Since late 2021, SkyCity has been improving its systems, investing in staff and technology, and reviewing processes to address these shortcomings.

SkyCity to pay NZ$4.16 million

SkyCity has settled with the New Zealand Department of Internal Affairs (DIA) over anti-money laundering and counter-terrorism financing rules breaches. These breaches occurred between February 2018 and March 2023 and involved issues with risk assessment, compliance programs, account monitoring, customer checks, and terminating business relationships. The DIA noted no evidence of direct involvement in money laundering or terrorism financing.

As part of the settlement, both parties will recommend a penalty of NZ$4.16 million to the high court, although the court will determine the final amount.

“This agreement is an impactful outcome,” said AML/CFT group director at the DIA, Mike Stone. “We have achieved our desired result without the extended duration and cost of court proceedings.

“While we consider these regulatory breaches to be serious, we are pleased that SkyCity was able to admit to the breaches and acknowledged responsibility for what were significant failings.”

SkyCity’s upgrades and leadership change

SkyCity has improved its anti-money laundering measures, including hiring new directors, enhancing audit capabilities, and appointing a chief risk officer. They’ve also raised customer due diligence standards and expanded their compliance teams. Plans include mandatory carded play by mid-2025. The DIA recognizes and supports these efforts.

SkyCity settled with New Zealand authorities over anti-money laundering failures and agreed to pay AU$67 million to Australian regulators for similar issues. Problems included poor risk assessments, inadequate transaction monitoring, and insufficient checks on high-risk customers. Both settlements follow years of compliance concerns and regulatory investigations.

In April, Jason Walbridge, an experienced gambling executive, was announced as SkyCity’s new CEO, effective in July, replacing Michael Ahearne. Meanwhile, CFO Julie Amey is resigning but will stay on for six more months. Andrew McPherson has been appointed permanent chief information officer after serving in the role temporarily since November.