A Jindabyne hotel was closed by police on Saturday after failing to comply with coronavirus restrictions despite three warnings.
The NSW government has labelled scenes of large gatherings at venues across Sydney "disturbing" and investigations continue into the conduct of Casula's Crossroads Hotel, which is linked to 13 cases.
Monaro Police District officers issued three formal warnings to the Jindabyne premises since May 5 over intoxication levels and public health issues.
Police closed the venue on Saturday night after further breaches.
The pub will be closed for 72 hours and police say further action is likely.
NSW Police Minister David Elliott was "flabbergasted" to by those breaking the rules.
"The recent images we have seen of mass gatherings and social distancing rules being blatantly ignored are disturbing," he said.
"The message remains clear, businesses and individuals will be fined and held to account for irresponsible and illegal behaviour that puts the whole community at risk."
Police are investigating the actions of the Crossroads Hotel, which is linked to a COVID-19 outbreak, to determine if it acted within COVID-19 legislation.
Several other Sydney venues are also under investigation for not following coronavirus rules.
The maximum penalty for contravening a Public Health Order in NSW is a fine of up to $11,000 and/or six months imprisonment.
NSW Police can also issue an on the spot fine of $1000 for individuals and $5000 for businesses.