The New Zealand Department of Internal Affairs (DIA) has announced the recovery of NZ$11.5 million (approximately US$6.6 million) following an investigation into compliance measures within the pokies sector. Operators found to be in violation will see the recovered funds returned to community organizations.
According to Section 106 of the Gambling Act 2003, holders of class 4 licenses, referred to as "corporate societies," are mandated to allocate or distribute the net proceeds from class 4 gambling exclusively to authorized purposes outlined in their licenses.
The DIA's investigation revealed widespread issues among class 4 gambling operators, commonly called pokies trusts. The regulator uncovered instances where funds intended for community grants were misappropriated for operational costs, like purchasing additional gaming machines.
Vicki Scott, the DIA’s director of gambling, remarked on the investigation’s significant outcomes. She stressed that the effort to enhance compliance and ensure that communities benefit from gambling proceeds will persist. "Most operators have worked constructively with us to address historical issues and improve their practices," Scott stated. "While we’ve made substantial progress, our work is not finished. We’ll continue working with operators to recover funding for communities, improve compliance, and maintain public confidence in the integrity of class 4 gambling."
In addition to recovering the NZ$11.5 million, the DIA took regulatory action against One Foundation, another class 4 gambling society. The DIA suspended One Foundation’s operating license for six days due to identified accounting failures concerning gambling proceeds and a failure to surrender a license for one of its pokies venues as legally required.
To aid compliance, the DIA has also issued new financial guidance for class 4 operators, aiming for better clarity regarding their accounting responsibilities and obligations. The department reports that this guidance intends to enhance consistency across the sector and help prevent similar issues from recurring.
The crackdown on land-based gambling in New Zealand is occurring at a time when the online market is preparing for launch in 2027. Earlier this year, a separate investigation named “Operation Turbo” resulted in an Auckland man being charged with eight counts under the Gambling Act for allegedly operating two illegal poker venues in the city. As the online sector evolves, international firms like Entain and Super Group have expressed their intent to secure three online gambling licenses each, within a total cap of 15 licenses for the market.
