Skycity Casino AML / KYC Policy

This document sets out the Anti-Money Laundering (AML) and Know Your Customer (KYC) policy applied by SkyCity Casino Management Limited (SCML) at casino venues in Auckland, Hamilton, and Queenstown, New Zealand. As a licensed casino operator and a reporting entity under the Anti-Money Laundering and Countering Financing of Terrorism Act 2009 (AML/CFT Act), SCML maintains AML/CFT compliance programs designed to prevent money laundering and terrorism financing.

1. Regulatory Framework

SCML operates under a casino operator’s licence issued in New Zealand and is subject to oversight by the Department of Internal Affairs (DIA). AML/CFT obligations have been in effect since the commencement of the AML/CFT Act in 2013.

Under the AML/CFT Act, SCML is required to:

• Conduct risk assessments of money laundering and terrorism financing risks
• Establish, implement, and maintain an AML/CFT program that complies with legislative requirements
• Monitor customer accounts and activities on an ongoing basis
• Apply enhanced due diligence where required
• Terminate business relationships that present unacceptable money laundering or terrorism financing risks or where compliance with legal obligations is not possible

2. Customer Identification and Verification

All customers engaging in prescribed transactions or establishing ongoing relationships with SCML venues must provide satisfactory identification. Customer identification and verification requirements apply, including but not limited to:

• Opening or maintaining player accounts
• Conducting transactions at or above statutory or risk-based thresholds
• Situations where SCML considers that the level of risk warrants additional checks

Identity is verified using reliable, independent documentation and information, which may include:

• Passports
• Driver licences
• Other government-issued identification documents

Verification must be completed before relevant transactions are processed or accounts are opened, unless the AML/CFT Act permits limited exceptions. Records of identification documents and verification procedures are retained in accordance with statutory requirements.

3. Risk Assessment and Customer Due Diligence

SCML conducts risk assessments to identify and evaluate money laundering and terrorism financing risks associated with:

• Customers and customer types
• Products and services
• Delivery channels
• Geographic factors and other relevant risk indicators

Customer due diligence (CDD) is applied:

• At account opening
• Before conducting certain transactions
• When there is a material change in the nature or purpose of the business relationship
• When there is a suspicion of money laundering or terrorism financing
• When SCML doubts the adequacy or veracity of previously obtained customer information

Enhanced due diligence (EDD) is applied to customers assessed as higher risk, including:

• International business customers
• Politically exposed persons (PEPs) and their close associates or family members
• Customers involved in high-value, complex, or unusual transactions
• Customers using high-risk products, services, or delivery channels

EDD measures may include:

• Additional identity verification steps
• Inquiries into the source of funds and source of wealth
• More frequent and detailed monitoring of account activity and transactions
• Obtaining senior management approval to establish or continue the business relationship

4. Account Monitoring and Transaction Reporting

Customer accounts and transactions are monitored on an ongoing basis to detect unusual or suspicious activity. Monitoring activities may include:

• Reviewing transaction patterns, frequency, and amounts
• Comparing activity against the expected behaviour based on customer profiles and risk assessments
• Identifying transactions that are inconsistent with known sources of funds or stated business purposes

Where activity is identified as suspicious, Suspicious Transaction Reports (STRs) are filed with the New Zealand Police Financial Intelligence Unit as required by law.

SCML also files Prescribed Transaction Reports (PTRs) in respect of cash transactions and other prescribed activities that meet or exceed statutory thresholds set out in the AML/CFT Act and associated regulations.

5. Enhanced Measures and Mandatory Carded Play

Since 2021, SCML has implemented enhanced AML/CFT measures across its New Zealand properties. These measures include:

• Lowered cash thresholds for triggering enhanced due diligence
• Cessation of business relationships with junket operators
• Strengthened host responsibility and monitoring teams

By mid-2025, mandatory carded play is scheduled to be operational across all SCML venues in New Zealand. Under mandatory carded play:

• Customers will be required to use registered cards for gaming activity
• Gaming activity will be more closely linked to customer identity
• Transaction tracking, identity verification, and compliance monitoring will be facilitated and improved in line with AML/CFT requirements

6. Termination of Business Relationships

The company reserves the right to terminate or refuse to establish a business relationship where:

• A customer fails or refuses to provide satisfactory identification or verification documents
• A customer does not cooperate with CDD or EDD measures
• The money laundering or terrorism financing risk associated with the customer is assessed as unacceptable
• Compliance with legal or regulatory obligations is not possible

Termination decisions are taken in accordance with the risk assessment framework and the AML/CFT Act. Where a relationship is terminated for AML/CFT reasons, relevant records are maintained and, where required, reports may be filed with the appropriate authorities.

7. Record Keeping

Records are maintained to demonstrate compliance with AML/CFT obligations. This includes records of:

• Customer identification and verification information
• Risk assessments and risk profiling
• Customer due diligence and enhanced due diligence measures
• Transactions, including prescribed transactions
• Suspicious activity detection and internal escalations
• Training and AML/CFT program documentation

Records are retained for at least the minimum period prescribed by the AML/CFT Act and applicable regulations. All records are stored securely and are accessible for audit, inspection, and regulatory review by the DIA or other authorised agencies.

8. Staff Training and Compliance Program

The AML/CFT compliance program includes regular staff training covering:

• Customer identification and verification procedures
• Recognition of indicators of suspicious or unusual activity
• Internal and external reporting obligations
• Legal and regulatory requirements under the AML/CFT Act
• Operational procedures related to risk assessment, CDD, and EDD

A designated AML/CFT compliance officer is responsible for:

• Overseeing the implementation and maintenance of the AML/CFT program
• Updating policies and procedures to reflect legal and regulatory changes
• Coordinating staff training on AML/CFT matters
• Acting as the primary contact with regulatory authorities and supervisory agencies

9. Historical Compliance Matters

Between February 2018 and March 2023, deficiencies were identified in the AML/CFT program operated by SCML. These deficiencies included:

• Inadequate money laundering and terrorism financing risk assessments
• Failures to maintain an AML/CFT program that fully complied with the AML/CFT Act
• Insufficient ongoing monitoring of certain customer accounts
• Incomplete or delayed enhanced due diligence for a number of international customers
• Delays in terminating certain business relationships that should have been exited sooner

These deficiencies were remediated by July 2021. In September 2024, the High Court of Auckland approved a civil penalty of NZD 4.16 million in settlement of proceedings brought by the DIA in relation to historic non-compliance. Following these matters, SCML has implemented comprehensive enhancements to AML/CFT systems and controls to reduce the risk of recurrence.

10. Policy Updates

This AML/KYC policy is reviewed periodically to reflect:

• Amendments to the AML/CFT Act and related regulations
• Updates to regulatory guidance issued by the DIA or other relevant authorities
• Changes in the risk environment, including new or emerging money laundering or terrorism financing risks
• Operational and system changes that affect AML/CFT controls

Updates may be communicated to customers and staff through appropriate channels. Customers are required to comply with identification and verification requests, to provide accurate and up-to-date information, and to cooperate with AML/CFT procedures at all times.

11. Contact and Queries

Queries regarding this AML/KYC policy, AML/CFT obligations, or related procedures may be directed to the AML/CFT compliance function at SkyCity Casino Management Limited venues or through the official contact channels published on the Skycity Casino website.