'Casinos are engines of crime'

Methamphetamine crystals (P) and precursor drug ContacNT or pseudoephedrine (pink) nabbed after New Zealand's biggest drug bust. Photo / Richard Robinson
Methamphetamine crystals (P) and precursor drug ContacNT or pseudoephedrine (pink) nabbed after New Zealand's biggest drug bust. Photo / Richard Robinson
Revelations that SkyCity casino is caught up in an alleged international crime syndicate is unsurprising considering the Government's inaction over money laundering in casinos, the Green Party says.

"Casinos are an engine of crime, so it's not surprising that another [alleged] money laundering ring has been exposed at SkyCity Casino," gambling spokeswoman Denise Roche said.

More than 330kg of the class-B drug pseudoephedrine was seized in Operation Ghost, which police say is enough to produce $100 million worth of methamphetamine.

Homes, luxury cars and cash worth up to $20 million were also seized in the record-breaking haul.

Inquiries by the Weekend Herald can reveal that the 18-month investigation started in the VIP lounge of the casino and police are focusing their attention on the millions of dollars gambled there by several individuals.

Ms Roche said included in the list of gambling concessions gifted to SkyCity Casino in their agreement with the Government to build a convention centre is an increase in 'ticket-in, ticket-out technology' and machines that can accept denominations of $20 and higher.

Both of these concessions were linked to increased problem gambling and money laundering, she said.

"Ticket-in, ticket-out technology is one of the best ways to increase money laundering. It enables anonymous gambling, which makes problem gambling easier and is directly linked to money laundering overseas," she said.

"The Department of Internal Affairs advised that there were serious questions about how easy this technology would make it for money launderers to use the casino to 'clean' the proceeds of crime, yet the Government still allowed for this to happen."

Internal Affairs Minister Chris Tremain was not immediately available for comment.

Assistant Commissioner Malcolm Burgess yesterday confirmed SkyCity gambling records for "three or four" targets would form part of an ongoing investigation to seize their assets.

"Substantial sums of money" were involved but Mr Burgess would not comment on specific amounts.

"If someone has spent a large sum of money at the casino and they haven't got a legitimate reason for having it, given the activity they've been allegedly engaged in, it's a reasonable assumption to think the money is connected to drugs," said Mr Burgess, the head of the Organised and Financial Crime Agency of New Zealand.

"I'm aware of three or four [accused] with a history at the casino. That gives us some insight into their assets. We'll use that as part of our investigation into the asset seizure and restraint process."

A spokesman for SkyCity said the casino had co-operated fully with the police and the Department of Internal Affairs and "fully discharged" its legal responsibilities, which he could not elaborate on because of legal restrictions.

More than five million people visit SkyCity each year, of which a small number try to engage in criminal activity, the spokesman said.

"We take our responsibilities in this area very seriously. We place a very strong emphasis on surveillance and security, spending millions of dollars on this each year. We work very closely with the police and other enforcement agencies.

"We have zero tolerance for alleged criminal behaviour, that's why any customers caught up in this investigation have either already been banned from our premises or will be as soon as possible as more information becomes available."

This is not the first time SkyCity has been embroiled in a major drugs operation.

Two ringleaders, Tac Kin Voong and Ri Tong Zhou, spent nearly $20 million at the casino in 12 months while using the VIP lounges as an office to conduct their criminal affairs.

In sentencing Zhou to 15 years in prison, Justice Rhys Harrison noted that anti-gambling lobbyists had warned that the casino could become a "scene for large-scale criminal activity or a meeting place for people who commit serious crimes".

A 2007 report by the Department of Internal Affairs revealed "a significant amount of evidence" that predominantly Asian groups "were frequenting New Zealand casinos for the purposes of criminal networking, money laundering and social gambling using illegitimate funds".

Operation Ghost has not uncovered any evidence of drug deals taking place inside SkyCity - unlike Zhou and Voong - but senior members of the alleged criminal syndicate arrested this week were socialising in the exclusive VIP lounge.

Their combined gambling turnover, the total of money spent and winnings, is believed to be in the tens of millions of dollars each year.

Assets will be restrained under the Criminal Proceeds (Recovery) Act.

The law essentially forces someone to prove how an asset was paid for - even if they were acquitted on criminal charges.

 

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