Gambling compliance blitz catches out Sydney pubs

By ROBBIE MASON.

Liquor & Gaming NSW (L&GNSW) has issued a warning that NSW venues are failing to comply with gambling harm-minimisation rules after it busted a string of pubs and bars for gaming-related offences.

L&GNSW inspectors recently attended two venues – the Earlwood Hotel and Wentworth Hotel in Homebush – on four separate occasions. During every visit they were able to withdraw money from a credit account.

Under the Gaming Machines Act 2001, venues with gaming machines are not allowed to have ATMs with credit access in any part of the venue.

L&GNSW have ordered the Wentworth Hotel, the fourth most profitable pub in NSW for poker machine takings, to remove the credit card withdrawal function from the ATM in question following a complaint from a patron who withdrew $2000 on credit.

The government agency also issued a direction to the owners of the Earlwood Hotel last week, ordering the removal of credit card access from an ATM on the premises and the purging of in-house gambling advertising from the ATM screen.

L&GNSW also discovered that venues including the Gaslight Inn and The Colombian Hotel in Darlinghurst were effectively operating their gaming rooms together as one expanded gaming room, breaching rules.

Tim Costello, chief advocate for the Alliance for Gambling Reform, told City Hub that he is “shocked but not surprised” by the news. He condemned the “profits before people” approach of the two venues, which now face financial penalties, and the wider gambling industry.

“The industry’s business model is literally built on targeting people with gambling harm.”

MLC Cate Faehrmann, the Greens spokesperson for gambling, expressed dismay at the news, telling City Hub “this is just another example of how this industry cannot be trusted to self-regulate and will not act in the interest of their patrons unless they are forced to.”

“The Government needs to direct Liquor and Gaming to take a much harder line on venues basically operating like it’s the Wild West,” she continued. “The fines also need to be increased as many venues would just be factoring these fines into their profits.”

Professor Sally Gainsbury, director of Australia’s only university-based gambling treatment centre, the Gambling Treatment and Research Clinic, said that compliance failures in NSW pubs harms the most vulnerable problem gamblers the most.

“The easier it is to access funds within a gambling venue to prologue a gambling session, the more likely it is that someone who is vulnerable to overspending will spend excessively,” she said.

“Research shows that individuals who repeatedly obtain money to extend a gambling session are much more likely to have gambling problems.”

“The harder it is to obtain money, including a requirement for physical movement, the likelihood of having to have a conversation, potentially engage in a different activity, or just the passage of time, the more likely someone can make an informed choice as to whether they really want to continue to gamble or take a break.”

Costello from the Alliance for Gambling Reform believes that harmful gambling practices and sites are flourishing under weak regulation.

“We don’t really have a regulator”, he said, “the people in the industry move to being in regulation, if you look at the flow between those in the industry and those in regulation. This is a stitch up.”

L&GNSW also announced that it is kicking off the next phase of its targeted compliance program today.

The latest phase involved 875 inspections over seven months. This blitz resulted in 77 penalty notices for gaming-related breaches and the commencement of three prosecutions.

Professor Gainsbury expressed support for the confiscation of licences held by non-compliant venues.

“Gambling licensing conditions are clear. If venues do not obey these, they should have their license revoked. Having a license to provide gambling is also a social license to ensure that a venue is not creating harm within a community.”

Pauline Lockie, an independent Inner West Councillor who has long advocated for gambling reform and harm minimisation, condemned the news.

“These latest revelations show why it’s so important for the NSW Government to urgently introduce real and proven measures to minimise gambling harm in our pubs and clubs, including cashless gaming systems,” she said.

“Until such steps are taken, we are going to continue to see poker machines cause devastating harm in our communities.

In October 2022, the NSW Crime Commission published the finding of its Inquiry into Money Laundering via Electronic Gaming Machines (EGM) in Hotels and Clubs.

The scathing report recorded evidence of widespread money laundering via gambling services in NSW pubs and clubs, as well as the inefficiency of current detection systems.

Criminals are able to claim that their possession of large quantities of cash are winnings from poker machine play, making it difficult to refute criminal behaviour.

City Hub reached out to the office of the Minister for Gaming and Racing, David Harris, for comment but did not receive a reply in time.