The Department of Internal Affairs is taking action against three gaming machine societies and seven pokie bars and has banned the funding of four harness racing clubs.
The department is not satisfied that gaming machine grants involving the organisations were transparent or free from conflicts of interest.
It has banned the Lion Foundation, Perry Foundation and Infinity Foundation from granting pokie funds to four northern clubs; the Thames Harness Racing Club and the Manukau, Kumeu and Franklin Trotting Clubs.
The department says grants to the clubs increased significantly after 2005, reaching more than $5.4 million within two years.
It also plans to impose a 21-day suspension on the licences of seven pokie venues run by Northern Hospitality Management, in which the clubs had invested.