The New Zealand Department of Internal Affairs (DIA) has successfully recovered NZ$11.5 million (approximately US$6.6 million) as part of a comprehensive investigation into compliance issues within the pokies industry.
On Friday, the gambling regulator announced that the recovered funds would be allocated to community organizations, emphasizing the significance of adhering to the Gambling Act 2003. Under Section 106 of this legislation, entities holding a class 4 gambling license, referred to as "corporate societies," are required to use net proceeds exclusively for authorized purposes outlined in their licenses.
During its investigation, the DIA worked closely with class 4 gambling operators, commonly known as pokies trusts, uncovering widespread compliance issues. These included misappropriations where funds intended for community grants were redirected towards society expenses, like acquiring additional gaming machines.
Vicki Scott, the DIA’s director of gambling, remarked on the notable outcomes of the investigation, while reinforcing the necessity of ongoing efforts to enhance compliance and ensure that communities receive their rightful share of gambling revenue.
“Most operators have worked constructively with us to address historical issues and improve their practices,” Scott stated. She added, “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 financial recovery, the DIA imposed a six-day suspension on the operating license of One Foundation, a class 4 gambling society. This action was prompted by identified accounting deficiencies related to gambling proceeds and a failure to timely surrender a license for one of its pokies venues as mandated by law.
As part of its accountability measures, the DIA has introduced new financial guidance for class 4 operators, aiming to clarify their accounting obligations and enhance consistency across the sector to mitigate the recurrence of similar compliance issues in the future.
This investigation into land-based gambling practices coincides with the looming expansion of the online gaming market in New Zealand, set to launch in 2027. Previously, a separate operation known as 3;Operation Turbo3; resulted in charges against an Auckland man for operating two illicit poker venues in central Auckland.
The DIA’s enhanced oversight occurs in a context where international firms like Entain and Super Group are looking to secure three of the 15 available licenses in the forthcoming online gambling market.
