SkyCity Adelaide Casino at Risk Over AML Shortcomings
- SkyCity executives were questioned by shareholders on AML practices
- The gambling group is the subject of two separate casino investigations in South Australia
- SkyCity preparing for potential regulatory penalties arising from the inquiries
SkyCity Entertainment Group is bracing for potential regulatory penalties arising from two separate investigations into its Adelaide casino. Senior executives informed shareholders of the status of both inquiries during the Group’s recent annual general meeting.
SkyCity Cooperating with Adelaide Investigation
In June 2021, Australia’s financial crimes watchdog AUSTRAC announced that it would launch an investigation into multiple casino operators in the country over possible breaches of anti-money laundering laws (AML). SkyCity was among those included in the probe, alongside embattled Australian casino giants Star Entertainment Group and Crown Resorts.
Less than a month later, South Australia’s Liquor and Gambling Regulator also announced an independent review of SkyCity’s suitability to hold a casino license in the state. The review, led by retired South Australian Supreme Court judge Brian Martin KC, was launched after a series of casino inquiries in other states found serious regulatory failings.
Glenn Davis, Chairman of SkyCity Adelaide, confirmed during the company’s annual general meeting that both investigations are ongoing and “huge amounts of information” have been provided in both cases. He also said they’re continuing to cooperate fully with the relevant agencies involved in the inquiries.
Davis told shareholders they don’t have a definitive answer as to the potential outcome of the investigations but they have carried out a review of the company’s practices and identified some areas for improvement, particularly in the AML aspect.
Regulatory Penalties Could be on the Way
Davis refused to delve into the details of the inquiries but warned that SkyCity faces “the risk of enforcement action and penalties” if investigators find serious breaches in its Adelaide operations.
He also clarified that regardless of the results of the investigations, SkyCity will not tolerate any criminal activity, including money laundering, in any of its Australian Casinos. In relation to this, SkyCity has enhanced its AML controls by adopting a wide range of recommendations from independent experts, Davis added.
Shareholders were also told that the company is maintaining a higher-than-normal liquidity headroom citing future uncertainty related to the impact of the pandemic as well as possible regulatory penalties arising from the AUSTRAC investigation into the company’s AML practices.
The money laundering issue was among the talking points at the annual general meeting, with one shareholder questioning why SkyCity seems to be “behind the eight ball” when it comes to AML. Group Chairman Julian Cook said it was quite disappointing to be in that situation but assured that the company’s leadership is doing everything it can to get SkyCity’s AML practices well ahead of any minimum standards.