Royal Commission call as Adelaide casino faces investigation

SkyCity Adelaide faces a second investigation into its casino business and its suitability to be licensed, amid warnings of “systemic problems” within the gambling sector and new calls for a Royal Commission.

Liquor and Gambling Commissioner Dini Soulio announced late Friday that retired South Australian Supreme Court judge Brian Martin QC would lead an “independent review” of SkyCity Adelaide’s casino operations.

Soulio said the new state-level investigation “will ensure that the way SkyCity operates demonstrates that the licensee is still eligible to hold the casino license in South Australia”.

He said Royal Commissions in Victoria and Western Australia at Crown Resorts, along with an investigation by the New South Wales gaming regulator into Star Entertainment, had identified “significant shortcomings” within the sector.

“Some of the issues addressed thus far extend beyond one organization and instead refer to broader systemic issues within the casino industry,” Soulio said in a statement.

The terms of reference for Martin’s examination include whether SkyCity Adelaide is an “Eligible Person to Hold the Casino License”, and if not, “what changes, if any, are required for the Licensee to become an Eligible Person to retain the Casino License”.

Similar terms of reference apply to whether SkyCity Entertainment Group, the New Zealand-based owner of Adelaide Casino, is an “eligible person to remain a close associate of the licensee”.

In a statement to the ASX on Friday, SkyCity Entertainment Group said it would cooperate with the investigation.

“SkyCity will fully cooperate with the assessment and any requests for information and documents,” the company said.

A written report of Martin’s findings and recommendations will be issued on 1 February next year.

It comes with the casino already subject to a separate investigation by the federal government’s financial crime watchdog for possible serious non-compliance with money laundering and terrorist financing laws.

That enforcement investigation, conducted by the Australian Transaction Reports and Analysis Center (AUSTRAC), was announced in June last year and has yet to be completed.

AUSTRAC said it could not comment on the ongoing investigation. The job description for Martin’s investigation allows him “not to investigate a particular case to the extent that he is satisfied that the matter has been sufficiently and appropriately handled by another investigation”.

The new state-level probe prompted SA-BEST MLC Connie Bonaros to renew calls for a Royal Commission at Adelaide Casino.

“The decision by the state gambling regulator to launch an independent inquiry into the activities of Adelaide Casino is deeply disturbing,” she said in a statement.

“While SA-BEST welcomes the independent investigation, we believe that nothing less than a Royal Commission is warranted.”

The Greens today joined Bonaros in calling for a Royal Commission.

“We think this should have the most extensive powers possible with utmost importance, and that means a Royal Commission,” said Greens MLC Tammy Franks.

“While I welcome Commissioner Soulio’s interest in this and action being taken, a Royal Commission is what is needed.”

The remaining House of Lords cross-bencher, One Nation MLC Sarah Game, said she supports “any necessary investigation into SkyCity Casino,” although her “priority for government spending is the current housing crisis and better care for our state’s most vulnerable children.” .

InDaily asked the cabinet of Consumer Affairs and Affairs Minister Andrea Michaels whether it supported a Royal Commission. In a response, a spokesperson said: “The minister supports the review announced on Friday.”

The opposition declined to comment on the matter, although it awaits the outcome of Martin’s investigation before forming a position.

AUSTRAC’s enforcement investigation into SkyCity Adelaide arose from concerns identified during a compliance assessment that began in September 2019.

The formal investigation is aimed at SkyCity Adelaide’s management of customers identified as high-risk and politically exposed persons between 1 July 2015 and 30 June 2016 and from 1 July 2018 to 30 June 2019.

SkyCity said at the time that the potential serious non-compliance included concerns related to ongoing customer due diligence and the adoption and maintenance of an Anti-Money Laundering and Terrorist Financing (AML/CTF) program.

“SkyCity has processes and practices in place to detect and prevent money laundering and is constantly reviewing them to ensure it meets all anti-money laundering requirements,” the company said in June 2021.

AUSTRAC studies generally take up to two years to complete, the agency says.

SkyCity Adelaide is the only Australian casino of the Sky City Entertainment Group. It also has operations in Auckland, Christchurch, Hamilton and Queenstown.

Adelaide Casino has 1080 slot machines, about eight percent of the state’s slots. SkyCity opened its $330 million Adelaide expansion in December 2021, featuring new gaming spaces, bars, restaurants and the luxury 120-room EoS hotel.

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