The operator of the Adelaide Casino could soon face heftier penalties of up to $75 million if it is found to engage in misconduct, under a proposed overhaul of South Australia’s gambling laws.

The SA government will introduce legislation to parliament next week, proposing to increase the maximum penalty faced by the state’s sole casino licence-holder — SkyCity — from $100,000 to $75 million.

Penalties for criminal offences such as failing to keep proper financial accounts, evading the payment of casino duty and failure to act on compliance notices would also increase if the government’s legislation passed.

“This is really balancing the community’s expectations with what we expect to see of our single casino holder,” SA’s Consumer and Business Affairs Minister, Andrea Michaels, said.

“We want to make sure fines aren’t just seen as a cost of doing business.”

The SA government reviewed its gambling operations penalties following a decision by the Australian Transaction Reports and Analysis Centre (AUSTRAC) in December to launch civil proceedings against SkyCity in the Federal Court.

AUSTRAC alleges SkyCity engaged in systemic non-compliance with anti-money laundering and counter terrorism financing laws, and “failed to carry out due diligence on 124 customers” — a breach that could result in fines of more than $2 billion.

In February, SkyCity increased the amount it had set aside to cover a potential civil penalty from $45 million to $73 million.

In a statement to the Australian Stock Exchange, it said it had “come to an agreement” with AUSTRAC and would “admit in the proceedings and the amount of a civil penalty they will jointly propose as appropriate in the circumstances”.

The matter is set to return to court in June.

Proposed laws to cover past misconduct

Ms Michaels said the proposed new state laws would cover past and future conduct, meaning the state government could impose retrospective fines of up to $75 million on SkyCity on top of any court-imposed penalty.

She said the proposed legislation had measures in place to ensure the state’s liquor and gambling commissioner considered penalties already imposed by a court when determining any additional fines.

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

A SkyCity spokesperson said the company understood the SA government’s position to review and update maximum penalties.

It said it “appreciates that it is a privilege to hold South Australia’s only casino licence and we continue to fully co-operate with all of our regulators”.

Acting SA Liquor and Gambling Commissioner, Fraser Stroud, said there had been an “immense amount of work” conducted interstate into casino operations, with penalties issued in excess of $100 million.

He said the current $100,000 penalty in South Australia was unacceptable and the state’s legislation had not been substantially updated since 1997.

Mr Stroud added that an investigation into the suitability of SkyCity continuing to hold SA’s sole casino licence, launched in 2022 and conducted by former Supreme Court judge Brian Martin, had been put on hold.

He said the outcome of the Federal Court case would determine how the review would proceed.

‘SkyCity lost that privilege’

SA independent upper house MP, Frank Pangallo, who has long-called for a royal commission to be established into SkyCity Adelaide, said the proposed penalty changes were “better late than never”.