Gambling News | 18 Jul 2024

SkyCity will close their casino in Auckland for five days later this year.

 The New Zealand city of Auckland is home to SkyCity Entertainment Group's land-based casino, which will be temporarily closed as part of a licence suspension deal with the country's secretary of internal affairs.
 Hello there!
 The deal calls for five days of closure at SkyCity Auckland this year.  The closing will resolve the case of the licence suspension, although when exactly this will take place is unclear.

 An ex-customer of SkyCity Auckland's lodged a complaint with the DIA in February 2022, which is relevant to the licence suspension application.  Between August 2017 and February 2021, the casino was in violation of responsible gaming regulations.

 After reviewing the matter, the secretary of internal affairs sought to provisionally revoke the casino licence of SCML, a SkyCity affiliate.  It mentioned concerns about the casino's ability to detect continuous play at the time.  In September 2023, the application for suspension was filed.

 The closure is anticipated to have a negative impact on the firm's underlying group EBITDA in FY2025 results, amounting to around NZ$5.0m (£2.3m.€2.8m/$3.0m) in total.

 Since this is the case, SkyCity has revised its FY2025 projection, saying that underlying group EBITDA will be between $245.0m and $265.0m.  This represents a decrease from the previous forecast range of NZ$250.0m to NZ$270.0m.

 The SkyCity settlement: what's in it?
 As part of the settlement, SkyCity and SCML admitted they were in violation of responsible gambling regulations and stated that the particular failure of continuous play was caused by a design flaw in their technological system, which has since been fixed.  

 SCML moreover acknowledged that it had not made sufficient use of its technological system in conjunction with human observation and intervention to detect continuous play.  It also formally apologised to the secretary of internal affairs for the incident.

 In its own statement regarding the matter, the DIA recognised the "swift" response and endeavours to enhance SkyCity's systems.

 The DIA expressed its admiration for SkyCity's efforts to enhance its performance in this area and its public pledge to keep doing better. 

 Improving risk management is a priority for SkyCity.  
 Julian Cook, chair of SkyCity, stated that the closure will end the situation and that the company has implemented new procedures to prevent similar problems in the future.

 We still have a long way to go before our risk mechanisms, particularly how we tackle financial crime and problem gambling, are up to snuff, he added.

 Focus, resources, and investment have all been areas where SkyCity has consistently failed to meet expectations.  We are dedicated to properly resolving this as it is incompatible with our regulatory responsibilities and our broader social license.

 In 2021, SkyCity began a transformation effort that would last for several years and improve the company's risk management practices.  Among these measures is the formation of a specialised risk and compliance committee and the appointment of additional directors with extensive expertise in this area.  A group chief risk officer has been appointed by SkyCity, and the company's internal auditing skills and external audit scrutiny have been enhanced.

 Furthermore, all of SkyCity's New Zealand casinos will be required to use card games.  This is scheduled to happen in the middle of 2025, and the casino in Adelaide, Australia will be opened by the end of the following year.

 Meanwhile, SkyCity named Jason Walbridge, a seasoned leader in the gambling industry, as its new chief executive officer (CEO) effective July 1.  Michael Ahearne has departed the organisation, and Walbridge is taking his place.

 "Our top priority is continuing to provide a safe and responsible environment for all of our employees and customers," stated SkyCity COO Callum Mallett.  "Our cooperative and constructive engagement with our regulators will continue."

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