SkyCity Agree To Pay A$67 Million To Settle AML Case

The Australian Transaction Reports and Analysis Centre (AUSTRAC), the country’s financial intelligence agency, has accused SkyCity’s Adelaide casino of failing to comply with anti-money laundering (AML) and counter-terrorism financing (CTF) regulations between 2016 and 2022.

In a move to settle these allegations, SkyCity has agreed to pay AUD$67 million (NZD$73.6 million) penalty, subject to approval by the Australian Federal Court. This penalty, which exceeds most analysts’ forecasts, underscores the gravity of the company’s AML/CTF breaches and the regulatory scrutiny it now faces.

The SkyCity Adelaide casino has been embroiled in a complex web of allegations and investigations related to its AML/CTF practices. AUSTRAC, the Australian financial watchdog, has claimed that the casino failed to conduct the necessary due diligence on high-risk gamblers, potentially allowing as much as AUD$4 billion to be laundered through the facility since 2016.

According to AUSTRAC’s findings, the casino frequently accepted large sums of cash, sometimes in dirty or damaged condition, often stored in envelopes or plastic bags. These practices, which are typical indicators of money laundering, were allegedly overlooked by SkyCity’s management and compliance teams.

In response to the allegations, SkyCity has acknowledged its shortcomings and expressed a commitment to improving its AML/CTF practices. Julian Cook, the company’s chairperson, has issued a public apology, stating that the casino “failed to live up to the standard required” and that it needs “to do better to meet the expectations of [its] regulators, customers and shareholders.”

To address these issues, SkyCity has already taken steps to enhance its training, monitoring, and compliance systems. The company has pledged to continue “lifting [its] AML/CTF practices” and ensuring that it provides “safe and responsible experiences and environments” for its customers and employees.

The SkyCity Adelaide casino’s AML/CTF breaches have not only resulted in a substantial financial penalty but have also subjected the facility to further regulatory scrutiny. The South Australian government has launched its own investigation into the casino’s operations, adding to the mounting pressure on the company.

In New Zealand, where SkyCity also operates casinos, the company faces allegations of additional money laundering rule violations. These allegations could potentially lead to a temporary suspension of the company’s casino license in the country, further compounding its legal and reputational challenges.