Consumer and Business Services Minister Andrea Michaels will next week introduce new laws to Parliament that would increase maximum fines faced by Adelaide’s casino operator from $100,000 to $75 million.

It would be the first time the legislation has been updated since it was introduced in 1997, with Michaels saying the huge increase to fines available to the SA Liquor and Gambling Commissioner was made to bring South Australia in line with penalties interstate.

Under the Casino Act, the Commissioner is responsible for granting and reviewing the state’s casino licence, can carry out investigations into the holder of the casino licence and undertake disciplinary action against SkyCity for breaches of the Act.

“This is off the back of what’s happened in the casino industry around the country where we’ve seen some substantial offences and penalties being imposed in other states,” Michaels said.

The minister said the proposed update to the Casino Act (1997) via the Casino (Penalties) Amendment Bill was retrospective and would apply if the Commissioner took disciplinary action against SkyCity.

Maximum penalties for criminal offences would also increase under the proposed bill, such as offences for failing to keep proper financial accounts, evading the payment of casino duty and failure to take action specified in a compliance notice issued by the  Commissioner.

It comes as SkyCity – the New Zealand-based operator of Adelaide’s casino – awaits the outcome of federal and state investigations.

AUSTRAC launched proceedings against SkyCity Adelaide in 2022, alleging “serious and systemic” non-compliance with anti-money laundering and counter-terrorism financing laws.

AUSTRAC’s 800-page statement of claim lodged in the Federal Court contains an extensive list of allegations against SkyCity Adelaide for non-compliance with the Anti-Money Laundering and Counter-Terrorism Financing Act 2006.

It included allegations that SkyCity Adelaide made $74 million from “high-risk” customers who had reported links to organised crime, while some gamblers at the casino used “cash that appeared to have been buried”.

In February, SkyCity said it had come to an agreement with AUSTRAC under which it would admit to contraventions alongside an amount for a civil penalty. A Federal Court hearing in relation to the penalty to be imposed has been set for June 7.

The casino also faces a state investigation into whether SkyCity Adelaide is fit to hold a casino license, with the inquiry put on hold while the AUSTRAC action in the Federal Court was ongoing.

The dual actions forced SkyCity to put $45 million aside in August last year to cover potential penalties from a federal inquiry into alleged breaches of money-laundering laws, acknowledging that each of the contraventions alleged by AUSTRAC attracts a maximum civil penalty of between $18 million and $22 million per contravention.

Michaels said this morning that being the state’s only casino licence holder was a “privilege”.

“The community has certain expectations about the behaviour of our casino licence holder,” she said.

“What we want to see is a greater level of accountability and we’ll see that through these increased fines.”

Acting Liquor and Gambling Commissioner Fraser Stroud said various factors would be considered under potential SkyCity Adelaide penalties.

“First and foremost it needs to be established: are we dealing with one potential breach of a code or breach of an act? Are there multiple breaches? What’s the seriousness of those matters?” he said.

“I’d anticipate off the back of that seriousness it’ll be determined as to what financial penalty will be deemed appropriate at that time.”

Opposition leader David Speirs said his party would “likely support the government” on the proposed changes.

“On the face of it, it’s certainly time to have an update or refresh of these laws, but I’ve not seen the laws and we’ll have to take those through the Parliamentary and party processes,” Speirs said.

“There’s been pretty concerning activity across the nation with regard to the appropriate nature and behaviour of casinos.

“It’s probably time that South Australia’s laws had an update. We’ll take a look at those and likely support the government in a general sense of this. We’ll have to see the details before making a decision.”

Impairments and the $45 million set aside to cover the potential federal fines slashed SkyCity’s full financial year profits to just $7.4 million. Were it not for the one-off costs, the group would have recorded a $127 million profit in FY23.

That trend continued into the latest financial year, and the group announced in February that underlying earnings for the first half were 10 per cent lower than the same period a year ago.

The company has also had a change in leadership recently, with a new CEO of the broader company appointed to replace Michael Ahearne. Locally, the top-ranking office holder in Australia – David Christian – announced his resignation in April. The former general manager of Mindil Beach Casino Resort in Darwin, Avril Baynes, has stepped in as interim COO.