Host responsibility issues

SkyCity Entertainment Group is reeling after New Zealand’s Department of Internal Affairs (DIA) pushed to suspend the license that allows the company to operate three casinos.

DIA wants the temporary suspension to last about ten days

The company released a statement on Monday morning about the matter, describing the request sent to the New Zealand Gambling Commission (NZGC). The DIA wants the temporary suspension to last about ten days following an allegation relating to host responsibility.

A previous customer made a complaint to the DIA last year. The person gambled between August 2017 and February 2021 at the operator’s casino in Auckland. They allege that the casino failed to comply with the requirements in its host responsibility program “relating to the detection of incidences of continuous play by the customer” and did not help the person after identifying them as a problem gambler.

A decision could take months

The NZGC will consider the suspension request and determine the length of such action if any is necessary. It could take a number of months for the NZGC to come to a decision, according to SkyCity’s statement. The company plans to fully cooperate with the investigation and will make its own submission regarding the matter.

The DIA takes the matter of gambling harm minimization extremely seriously and is committed to carrying out firm action on any licensees failing to live up to requirements. All casinos in the country undergo regular audits and monitoring to ensure that they meet their relevant responsibilities and obligations.

The identification of problem gamblers is something that all forms of licensed gambling operators have to take seriously. SkyCity has facial recognition technology in place at its Auckland facility to monitor people entering the property. An incoming update will allow it to analyze the behavior of patrons when they are on the casino floor.

The fallout

SkyCity’s share price fell by 13% by the end of trading on Monday. Investment firm Forsyth Barr’s Head of Research Andy Bowley estimates that a ten-day license suspension could lead to a revenue drop of about NZ$13m (US$7.7m).

This is not the only recent instance of SkyCity falling into hot water. It allocated NZ$49m (US$29m) last month to cover a possible civil penalty regarding alleged anti-money laundering failings at its casino in Adelaide, Australia. It faces accusations by the Australian Transaction Reports and Analysis Center (AUSTRAC) of systemic and serious non-compliance. This could have knock-on consequences for its license in South Australia.