Subj : SkyCity to settle money-laundering, terrorism-financing law case
To   : All
From : News
Date : Tue May 21 2024 12:25 pm

SkyCity will pay $4.16 million after reaching an agreement with the
Department of Internal Affairs (DIA) to resolve civil penalty proceedings
over alleged non-compliance with anti-money laundering and
terrorism-financing laws.

The proceedings, filed in February, were for alleged non-compliance with the
Anti-Money Laundering and Countering Financing of Terrorism Act 2009 by
SkyCity Casino Management Limited (SCML).

SCML is a subsidiary of SkyCity and holds its casino operator's licence for
operations in Auckland, Hamilton and Queenstown.

In a statement this morning, the DIA said the settlement - agreed by both
parties - saw SkyCity admit to all five causes of action in the claim. The
Casino also agreed to pay a penalty of $4.16 million for its breaches,
although the court still needs to make a final determination.

"The parties will now recommend to the High Court that the proceedings can
move to a penalty hearing, where a penalty amount will be determined," the
statement read.

"The parties have agreed to jointly submit to the Court that a penalty of
$4.16m is appropriate in this case, though the final determination is for the
Court."

The agreement comes after a review by the DIA, which took place between
September 2022 and December 2023, investigating SkyCity's anti-money
laundering and countering financing terrorism compliance.

The review found the casino had breached its obligations.

The breached obligations related to its AML/CFT risk assessment,
establishing, implementing, and maintaining an AML/CFT compliance programme,
the monitoring of accounts and transactions, conducting compliant enhanced
customer due diligence, and terminating existing business relationships when
required.

"These failures spanned between February 2018 and March 2023," DIA said.

However, there was no evidence to suggest the casino was directly involved in
money laundering or the financing of terrorism.

"This agreement is an impactful outcome," Mike Stone, director AML/CFT group
DIA, said.

"We have achieved our desired result without the extended duration and cost
of court proceedings.

"While we consider these regulatory breaches to be serious, we are pleased
that SkyCity was able to admit to the breaches and acknowledged
responsibility for what were significant failings.

"It is encouraging to see the work SkyCity has already done to lift its
performance in this area and its public commitment to continue to improve. We
will be working closely with SkyCity in the future in relation to its ongoing
compliance obligations.

"We are proud that our work has contributed to the integrity of New Zealand's
financial system and can encourage public confidence in our regulations aimed
at deterring money laundering and terrorism financing.

SkyCity apologises
SkyCity executive chair Julian Cook accepted the DIA's findings and
apologised.

"SkyCity has been subject to regulatory enforcement action in both Australia
and New Zealand, and those regulators are rightly holding SkyCity
accountable," he said.

"Over the past few years, considerable progress has been made towards
upgrading our anti-money laundering and countering terrorism financing
(AML/CFT) systems.

"This does not lessen the seriousness with which we take these breaches, and
we are disappointed that SkyCity is in this position. As a casino operator,
we play a key role in combatting money laundering and terrorism financing and
we take that responsibility seriously.

"On behalf of the SkyCity Board and management team, I accept and apologise
for these long-standing failings," he said.

He said SkyCity had "fallen short of the standards we should hold ourselves
to, alongside failing to meet the expectations of our regulators, customers,
shareholders and the communities we are part of".

"We are committed to, and have begun, delivering the level of change that is
required to meet these expectations."

Cook said that since late 2021, SkyCity had introduced a "significant"
Anti-Money Laundering and Countering Financing of Terrorism enhancement
programme "to address compliance systems and correct historical shortcomings".

"Our enhancement activities remain ongoing, and we have further important
work to do in New Zealand and Australia which will take time to complete. We
have commenced a comprehensive multi-year transformation programme to
strengthen how we manage risk across the SkyCity Group.

"We are determined to continually lift our AML/CFT practices, comply with our
obligations and uphold our customer, community, and regulatory expectations.

"We remain committed to ensuring that we provide safe and responsible
experiences and environments for our people and customers and will continue
to engage cooperatively and constructively with our regulators."

--- Mystic BBS v1.12 A44 2020/02/04 (Windows/64)
 * Origin: S.W.A.T.S BBS Telnet swatsbbs.ddns.net:2323 (63:10/102)

.