A statewide probe into the fitness of SkyCity Adelaide to hold an operating permit has been put on hold as the gambling operator faces legal action in Federal Court over an alleged serious and systemic lack of compliance with the anti-money laundering legislation of Australia.
For the last seven months, former SA Supreme Court Judge Brian Martin KC has been investigating whether the Adelaide casino of SkyCity Group is suitable to keep its South Australian casino licence and if not, what changes would be required for the company to make in order to make sure it is an entity fit to hold the permit.
As Casino Guardian previously revealed, the independent review into the casino was established by the state’s gambling regulatory body – the Liquor and Gambling Commissioner – on July 1st, 2022 after some other inquiries had unveiled major regulatory transgressions within the local casino industry. The probe was also given a start more than a year after the AUSTRAC (Australian Transaction Reports and Analysis Centre) started investigating the level of compliance that SkyCity Adelaide showed in terms of the country’s anti-money laundering laws.
The Royal Commissioner had to provide the Liquor and Gambling Commissioner Dini Soulio with a written report on his findings on February 1st, 2023 and, as confirmed by Mr Soulio, he had received some “preliminary materials” as a result of Mr Martin’s probe. However, the findings of Brian Martin KC’s review have been complicated after in December 2022 the AUSTRAC revealed that it would be suing SkyCity Adelaide in Federal Court over alleged lack of compliance with Australian anti-money laundering laws.
Liquor and Gambling Commissioner Puts the Inquiry into Casino’s Suitability to Keep Its Licence on Hold
The Liquor and Gambling Commissioner revealed that Brian Martin KC recommended to him that the question of whether SkyCity Adelaide is fit to hold a casino operating permit in South Australia could not be reliably determined until the legal proceedings filed by the AUSTRAC in the Federal Court were resolved.
The probe held by Mr Martin KC into the casino’s operations in Adelaide had been fully separate and independent from the proceedings that the financial intelligence agency of Australia filed against SkyCity in the Federal Court. Despite that, there are clearly some wrongdoings that overlap in both investigations and need to be taken into consideration. That is exactly why the Royal Commissioner has recommended that the question of SkyCity Adelaide’s suitability should not be resolved until the resolution of the ongoing AUSTRAC proceedings in the Federal Court.
Therefore, Mr Soulio decided to put the investigation on hold with regard to an overall determination of the gambling operator’s fitness to hold its Adelaide casino licence. He explained that he was still considering his options about potential regulatory action resulting from the investigation held by the Royal Commissioner. He revealed that he had written to SkyCity in regard to the allegations raised in the legal proceedings filed by the Australian Transaction Reports and Analysis Centre and some preliminary issues. He also explained that further information on the case would be made public as soon as possible.
The parent company of SkyCity Adelaide – the SkyCity Entertainment Group – shared that the casino is still having a constructive dialogue with the Royal Commissioner and plans to continue to cooperate with Consumer and Business Services. The company will also provide any information and documents that may be subject to further request. The operator explained that its Adelaide casino continues to implement its host responsibility and anti-money laundering programmes to meet the provisions of the law and good practices.
AUSTRAC Takes SkyCity Adelaide to Court over Multiple Alleged Violations of AML and CTF Laws
The 800-statement of the claim that the AUSTRAC filed in the Federal Court contains an extensive list of allegations that claim SkyCity Adelaide has violated the country’s Anti-Money Laundering and Counter-Terrorism Financing Act of 2006.
Allegedly, the casino’s operation breached Section 81 of the aforementioned piece of legislation, and more specifically, the requirement to have an anti-money laundering (AML) and counter-terrorism financing (CTF) programme. The legal action filed in the Federal Court also alleged 124 violations of Section 36 of the Act, which requires casino venues to hold ongoing customer due diligence associated with AML and CTF risks.
The country’s financial watchdog claims that the casino provided services to 59 customers for whom high money-laundering and terrorism financing risks had been indicated. The AUSTRAC alleges that these 59 casino patrons generated losses amounting to approximately AU$74 million at SkyCity Adelaide. The regulatory body also claims that one customer, known as “Customer 11”, was “an immediate family member” of an individual who held a prominent public position in a foreign government body.
According to court claims, a large number of customers were engaged in massive cash transactions that seemed particularly suspicious, including ones involving money being transferred in garbage bags, plastic bags, cash bundled together with rubber bands, cash that seemed to have been buried, etc.
As previously reported by Casino Guardian, Premier Peter Malinauskas shared that the state Government was ready to make all the necessary changes to SkyCity Adelaide upon the completion of the Royal Commissioner’s investigation and the outcome of his review. At the time, Mr Malinauskas explained that the local Government expected the casino venue to operate with integrity and in line with the law.
- Author
Olivia Cole
