KIWI CASINO TOLD TO LEAVE THE INTERNET

06 August 2007

Christchurch Casino has been forced to exit the Internet Gambling business, Internal Affairs has forced Christchurch Casino to exit, but they also let the company continue its two online casinos and bingo and poker sites for seven months after deciding they had breached the Gambling Act.

The company will have amp time to sell the business as a going concern to overseas owners. Kiwi Casino.com was launched by Christchurch in 2000 as it first online casino. Which later expanded its Net gaming activities to include portfolio sister websites offering online bingo and poker.

In August, 2006, the department told Christchurch Casino that its involvement in Internet Gambling breached the Gambling Act,that was passed in 2003. Clearing it after an earlier investigation which carried out under previous legislation, that also prevented organizations other than the TAB from accepting bets from Kiwi’s over the Net.

Trevor Henry, spokesman, said “Internal Affairs never sent a letter asking Christchurch Casino to “cease and desist.” Instead, Christchurch Casino told Internal Affairs in October of 2006, that it intended to sell the business, which is confirmed it had done in a letter to the department in March of 2007. Mr. Henry defended the delay. He said “the way these things work, there are always exchanges and arguments and so forth. We reached the decision and we will be sending a letter, also in the meantime we got advice to say we are selling.”

Rich Barker, Internal Affairs Minister said “He is satisfied with the process the department followed. “ “Prior to taking prosecution action, the department sought Crown Law to confirm its view. It received this on February, 23 2007.” “Had Christchurch Casino chosen to keep the website and defend the issue through the courts, the process would have taken longer.”
Mr. Henry also says “the investigation will be closed once Internal Affairs has confirmed that no New Zealand entity now has an ownership interest in Kiwi Casino.”

Kiwi Casino made the sale public after a repart came from Mr. Barker by the department last month. The report addressed allegations of loan sharking and other impropriety at the casino that had led to calls for public enquiry.
Internal Affairs said “the allegations had been used to suggest that the casino was not properly managed and that the department was “not an effective casino reulator”.

The investigation began in November of 2000, when Internal Affairs began its first investigation into the legality of Kiwi Casino. Christchurch ran the company through an overseas subsidiary, “Christchurch Casino E-Gaming Investments”, using a license issued by the Government of Antiqua and Barbuda.

In 2002, papers were released to NZ InfoTech, under the Official Information Act that showed Internal Affairs let its investigation lapse after accepting assurances from Christchurch Casino that procedures were in place that made it difficult for New Zealanders to register to use its websites.

Gregory Crott, Internal Affairs’ national manager of gaming compliance at the time, finally closed the departments investigation in 2002 after NZ InfoTech requested an update on its status. He cited “the length of time taken on the investigation” as one reason for the decision. Mr. Henry says “Internal Affairs kicked off a fresh investigation in August 2005 on the initiative of its Christchurch inspectorate, a year after the Gambling Act came into force.

NZ InfoTech reported in 2002, the department gave Christchurch Casino the benefit of doubt. That was under the legislation current at that time. But that the situation changed under the Gambling Act, which also included a specific provision covering remote interactive gambling.

Internal Affairs did confirm they received free meals from Christchurch Casinos canteen for 10 years through October 2004, after it was reported by The Press, and still continued means but with a price of $2 per meal. Inspectors have now been told not to eat at the canteen until after a further review.