NZ High Court agrees with Christchurch Casino’s AML penalty

Summary

The New Zealand High Court has upheld the settlement reached between Christchurch Casino and the Department of Internal Affairs (DIA) over breaches of anti-money laundering and counter‑terrorism financing laws. The parties agreed a penalty of NZ$5.06m (around €2.52m), which Justice Rachel Dunningham described as “significant” and reflective of serious shortcomings in the casino’s compliance and oversight.

The DIA’s investigation covered the period May 2023 to September 2024 and found failures across the casino’s AML/CFT programme. Sample customer transactions totalling roughly NZ$56m from 24 customers should have led to enhanced customer due diligence and termination of business relationships; instead only 11 customers were banned, relationships were not terminated, and enhanced checks were not carried out. Five of the sampled customers were connected to suspicious activity reports. Christchurch Casino admitted the breaches as part of the settlement.

Justice Dunningham initially assessed a NZ$6.03m penalty but reduced it by 20% to reflect the casino’s admission of liability and cooperation. The judgement criticised the casino’s slow response to flagged deficiencies, a casual approach to statutory obligations, significant limitations in account monitoring, and a lack of internal AML audits (no audits after September 2020 and no programme review between June 2021 and September 2024). The casino was not accused of directly laundering money or financing terrorism and has committed to completing internal audits and updating its AML programme where required.

Key Points

The High Court endorsed a NZ$5.06m settlement between Christchurch Casino and the DIA for AML/CFT breaches.
DIA’s probe (May 2023–Sep 2024) found monitoring failures: ~NZ$56m in sample transactions should have triggered enhanced due diligence.
Only 11 of 24 risky customers were banned; relationships were not terminated and enhanced due diligence was not completed.
Five customers in the sample were linked to one or more suspicious activity reports (SARs).
Justice Dunningham set a NZ$6.03m starting penalty, reduced 20% for admission and cooperation to reach NZ$5.06m.
The court criticised the casino’s slow reaction to warnings, gaps in account‑monitoring systems and a lapse in internal AML audits since September 2020.
The casino admitted the breaches and has committed to internal audits and updates to its AML programme; it was not accused of direct involvement in laundering or terrorism financing.

Context and relevance

This ruling is a clear signal that regulators and courts will penalise inadequate AML/CFT controls even where there is no finding of direct criminal involvement. For operators in New Zealand and internationally, the decision underlines that compliance programmes must be actively maintained, audited and improved. The case reinforces a global enforcement trend: regulators expect concrete monitoring, timely escalation and proper record-keeping — and they will apply substantial financial penalties when systems fall short.

Why should I read this?

If you work in compliance, operations or run a casino/licensed venue, read this — it’s a reminder that ticking boxes isn’t enough. The court hit the operator hard because monitoring stalled, audits stopped and flagged risks weren’t handled properly. Short version: keep your AML programme live, and don’t let warnings gather dust.