Casinos Debate Adherence and Customer Satisfaction during FinCEN Enforcement Campaign
American casinos are apprehensive about the possibility of being required to reveal the origins of their high rollers' gambling funds. The Financial Crimes Enforcement Network (FinCEN) within the Treasury Department is anticipated to announce that they will soon conform with Title 31 of the Bank Secrecy Act, aligning with banks and other businesses to combat money laundering.
These establishments worry that the changes will deal another blow to their revenue, as attendances are already sluggish with the declining performance of the Las Vegas Strip compared to the thriving earnings in Macau and other emerging Asian markets. Casinos heavily rely on "whales" for a portion of their income, particularly during a downturn when regular visitors stay home, and the secretive nature of this relationship could be severely disrupted if these regulations are strictly enforced.
Not Likely Secrets Will Remain
Despite their apprehensions, experts warn that it is not a matter of "if" but "when". Fred Curry, a partner in Deloitte Financial Advisory Services, advocates that casinos should be proactive in preparing for the FinCEN announcement and working on their anti-money laundering initiatives.
"Casinos should be getting ready now for the FinCEN announcement and improving their anti-money laundering programs," said Curry.
Other hints have been coming from FinCEN. Last year at the Global Gaming Expo in Las Vegas, the FinCEN Director, Jennifer Shasky Calvery, warned that "every financial institution, casinos included, should be concerned about its reputation. Integrity goes a long way."
Drug Trafficking Connection
The Las Vegas Sands Corp was recently compelled to settle with federal authorities for $47.4 million to evade prosecution related to one of its high rollers, Zhenli Ye Gon, a self-crowned Chinese-Mexican businessman who supposedly wagered $84 million at the Venetian. Ye Gon was arrested in 2007 and charged with international drug trafficking. LVS admitted to not thoroughly examining Ye Gon's sources of finance. Following the incident, the casino conglomerate has been singled out for its improved adherence to Title 31 and their renewed commitment to anti-money laundering.
However, it has been alleged that Caesars is also under investigation by FinCEN concerning money laundering, with Curry believing that other casinos may be similarly implicated.
Under Title 31, transactions which total more than $10,000 within a 24-hour period necessitate the completion of a Currency Transaction Report. This report must include personal information about the individual or individuals involved, regardless of whether it concerns payments into the casino, payouts, or money exchanged. Employees of a casino are barred from assisting customers in evading the Currency Transaction Report.
"This is a significant issue that could drastically alter the way casinos carry out business," remarked Geoff Freeman, President of the American Gaming Association, acknowledging that although casinos are "committed to a culture of compliance," they are simultaneously trapped in "deepening our partnership with FinCEN ... [and are] actively engaged with key federal agencies" to reach a consensus on this matter.
Nevertheless, Ken Adams, a gaming consultant from Reno, shares these concerns, asserting that each time the federal government shows interest in the casino industry, it tends to be detrimental to the casinos.
Read also:
- Leverkusen claims victory in the cup, securing a double triumph.
- Alonso achieves a double victory after consuming a German brew.
- Does the SVolt factory in Saarland face stability issues?
- Furor surrounding Sylt scandal footage