New Zealand launches major gambling grant fraud prosecution

The Department of Internal Affairs has filed more than 500 charges against 23 individuals.

New Zealand.- The Department of Internal Affairs (DIA) has initiated what it describes as the largest gambling grant fraud prosecution in New Zealand’s history. It’s charged 23 individuals in connection with the alleged misuse of community funding generated by Class 4 gaming machines, commonly known as pokie machines.

The defendants appeared before the Auckland District Court and face more than 500 charges under the Crimes Act 1961, including money laundering, receiving stolen property and the use of forged documents. All have been granted interim name suppression ahead of their next court appearance scheduled for 9 April 2026.

At the centre of the case is the alleged misappropriation of NZ$3.2 m (US$2m) in grants distributed through New Zealand’s Class 4 gambling system, which mandates that gaming machine operators return at least 40 per cent of profits to community organisations and charities under the Gambling Act 2003.

According to DIA Gambling Director Vicki Scott, investigators uncovered a network of six charities and incorporated societies allegedly used to obtain grant funding for personal gain following a “mammoth and complex” probe named Operation Indago. Authorities claim that a significant portion of the funds was redirected under the guise of staff costs, including payments to “bogus employees.”

It’s alleged that several of the entities involved were not legitimate community bodies but were instead established primarily to access gambling-derived funding streams.

The investigation extends beyond grant applications, with authorities alleging that some defendants were involved in operating a pokie venue. Investigators claim that grant funds were moved through venue bank accounts and, in some instances, used to repay gaming machine profits to Class 4 operators, potentially distorting the intended community return model.

Scott said the alleged conduct was a “cynical abuse of the gambling system” that undermined regulatory safeguards designed to ensure gambling proceeds are reinvested into local communities rather than diverted for private benefit.

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See also: New South Wales gaming venue licensee fined over ATM with credit access

The Department of Internal Affairs has filed more than 500 charges against 23 individuals. New Zealand.- The Department of Internal Affairs (DIA) has initiated what it describes as the largest gambling grant fraud prosecution in New Zealand’s history. It’s charged 23 individuals in connection with the alleged misuse of community funding generated by Class 4…