The New Zealand Department of Internal Affairs (DIA) has successfully recovered NZ$11.5 million (US$6.6 million) as part of an investigation focusing on compliance within the pokies sector. Announced on Friday, the regulator indicated that these funds will be allocated to community organizations.
According to Section 106 of the Gambling Act 2003, holders of class 4 licenses, often referred to as “corporate societies,” are required to use their net proceeds from class 4 gambling for authorized purposes outlined in their licenses.
The DIA's collaboration with class 4 gambling operators, known as pokies trusts, uncovered significant compliance issues. Many operators misused funds that were intended for community grants, diverting them instead to cover operational expenses, including the purchase of additional gaming machines.
Vicki Scott, the DIA’s director of gambling, expressed satisfaction with the results of the investigation but emphasized the need for ongoing efforts to boost compliance and ensure communities benefit from gambling revenues. “Most operators have worked constructively with us to address historical issues and improve their practices,” said Scott. “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 the recovery, the DIA took enforcement action against One Foundation, a class 4 gambling society. This organization faced a six-day suspension of its operating license due to accounting failures regarding gambling proceeds and its failure to surrender a license for one of its pokies venues as legally required.
To enhance transparency and compliance, the DIA also released new financial guidance for class 4 operators, aimed at clarifying accounting requirements and obligations to prevent future issues. The guidance intends to foster consistency across the sector.
Meanwhile, this intensified scrutiny on land-based gambling coincides with the upcoming liberalization of the online gambling market, set to launch in 2027. In an earlier investigation dubbed “Operation Turbo,” an Auckland man faced eight charges under the Gambling Act related to two illegal poker venues in central Auckland. As the online sector evolves, international companies like Entain and Super Group have both expressed interest in acquiring three online gambling licenses under the 15-cap limit set for the market.
