In our news blogs last week, we talked about SkyCity’s temporary shutdown of their Auckland branch, and now this week, we have an update on the situation.
The 5-day voluntary shutdown that SkyCity Entertainment Group of New Zealand had agreed to subject its Auckland casino to is set to rub its nose in the mud, with the company set to bleed to the tune of NZ$5 million (US$3 million).
The SkyCity casino in Auckland, New Zealand now has the dubious distinction of being the first land-based casino in New Zealand to have shut down voluntarily as a result of negotiations between the casino’s parent company and the Department of Internal Affairs (DIA).
Speaking about this, the Director of Gambling at the DIA, Vicki Scott, said, “The resolution agreement is an unprecedented result. This is the first voluntary closure of a casino and is the longest suspension of operations in a casino under the Gambling Act.”
The closure will come at a steep price, though. A report in the New Zealand Herald put the cost at a whopping NZ$1 million a day, or a total of NZ$5 million in all. The management may take solace from the fact that the price could have been bigger, namely, closure of 2 more of its casinos – in Hamilton and Queenstown – for 10 days at a much higher price of approximately NZ$8 million.
The 5-day closure that SkyCity Auckland is bracing itself for is the result of negotiations with the DIA to mitigate the fallout of an investigation into lapses on the part of the casino in implementing the Host Responsibility Program.
The closure is part of the settlement that the casino’s owners have arrived at with the DIA, after the latter filed for suspension of the casino on charges of lapses in implementing critical protocols to safeguard player interests based on a complaint by a player.
The DIA had filed the suspension application with the New Zealand Gambling Commission, and later withdrew it and filed another one asking for the closure with the precondition that the casino fulfilled all the stipulated recommendations.
The path to reconciliation opened up after SkyCity Entertainment Group Ltd. admitted to failures that resulted in breaches in the implementation of security protocols in some of its casinos. In a statement earlier, Callum Mallett, the COO of SkyCity New Zealand said that the lapses were critical and it was only fair that the company was being made to answer for them.
In his statement Mallett said that the casino placed a high premium on host responsibility normally, and that is what made the failure so big. Owning up to the failures he also apologised on behalf of the company’s board as well as management team.
The DIA initiated the investigation based on a complaint by one of the players at the casino about having gambled continuously for long time periods a staggering 23 times, between 2017 and 2021.
The reason for this was simple: one of the systems designed to ensure host responsibility had failed. As a result the casino hadn’t been able to identify the player as he played for those inordinately long hours. What made it worse was that the player identified 23 instances between 2017 and 2021 when he was able to gamble undisturbed for long periods of time.
The player’s complaint further mentioned that he had accumulated enormous gambling debt as a result of his gambling activity, something that could have been prevented had the tech deployed by SkyCity and the systems it had in place had functioned properly. He contended that the company had, therefore, directly contributed to his problems by violating the rules pertaining to responsible gambling.
Following the player’s statements, SkyCity Auckland launched an internal investigation to determine the cause of the issue. The casino’s findings pinned the blame for the oversight on a technological glitch. The issue has now been rectified and the casino has also issued an apology for the lapse.
Julian Cook, the chairman of SkyCity, added his own comments, stating that the entire SkyCity team is now committed to improving, “The SkyCity Board, executive and entire team are wholly committed to doing better, and building back trust.” He said the company was aware that the way ahead may be long; they had plans in place, and also the required people and investments, to set right this flaw.
When SkyCity Entertainment Group Ltd. announced last month that it had reached an agreement with the DIA to voluntarily close its Auckland casino for 5 days, there was no official date mentioned – it was stated that the closure would happen before the end of 2024.
That situation has been resolved now, with SkyCity finally announcing the dates of closure. In a statement yesterday, the company said it would be closing the casino down from Monday, September 9 to Friday, September 13.
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