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Royal Commission call as Adelaide casino faces inquiry

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SkyCity Adelaide is facing a second probe into its casino operations and whether it’s fit to hold a licence, amid warnings over “systemic issues” within the gambling sector and new calls for a Royal Commission.

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Liquor and Gambling Commissioner Dini Soulio announced late on 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 inquiry will “ensure that the way that SkyCity operates demonstrates that the licensee is still suitable to hold the casino licence in South Australia”.

He said Royal Commissions in Victoria and Western Australia into Crown Resorts along with a New South Wales gaming regulator probe into Star Entertainment had identified “significant failings” within the sector.

“A number of the matters raised to date extend beyond any one organisation and point instead to broader systemic issues within the casino industry,” Soulio said in statement.

The terms of reference for Martin’s inquiry include whether SkyCity Adelaide is a “suitable person to continue to hold the casino licence”, and if not, “what changes, if any, are required for the licensee to become a suitable person to hold the casino license”.

Similar terms of reference apply to whether SkyCity Entertainment Group, Adelaide Casino’s New Zealand-based owner, is a “suitable person to continue to be a close associate of the licensee”.

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

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

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

It comes with the casino already subject to a separate probe from the federal government’s financial crimes watchdog for potential serious non-compliance with anti-money laundering and counter-terrorism financing laws.

That enforcement investigation, undertaken by the Australian Transaction Reports and Analysis Centre (AUSTRAC), was announced in June last year and is yet to reach a conclusion.

AUSTRAC said it was unable to comment further on its ongoing investigation. The terms of reference for Martin’s inquiry allow him “not to investigate … a particular matter to the extent that he is satisfied that the matter has been, is being, or will be sufficiently and appropriately dealt with by another investigation”.

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

“The decision by the state’s gambling regulator to commission an independent investigation into the operations of Adelaide Casino is deeply troubling,” she said in a statement.

“While SA-BEST welcomes the independent inquiry, we believe nothing short of a Royal Commission is warranted.”

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

“We think that this needs to have the most broad-ranging powers possible with the greatest importance, and that means a Royal Commission,” Greens MLC Tammy Franks said.

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

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

InDaily asked the office of Consumer and Business Affairs Minister Andrea Michaels whether she supported a Royal Commision. In response, a spokesperson said: “The Minister supports the review announced on Friday.”

The Opposition declined to comment on the matter although it’s understood to be waiting on the outcome of Martin’s inquiry before forming a position.

AUSTRAC’s enforcement investigation of SkyCity Adelaide stemmed from concerns identified during the course of a compliance assessment which began in September 2019.

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

SkyCity at the time said the potential serious non-compliance included concerns relating to ongoing customer due diligence, and adopting and maintaining an Anti-Money Laundering and Counter-Terrorism Financing (AML/CTF) program.

“SkyCity has processes and practices in place in its business to detect and prevent money laundering and continually reviews these to ensure it meets all anti-money laundering requirements,” the company said in June 2021.

AUSTRAC investigations generally take up to two years for completion, the agency says.

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

Adelaide Casino holds 1080 gaming machines, around eight per cent of the state’s operating pokies. 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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