Big spenders could exit Vegas
The U.S. Treasury Department may soon require casinos to determine and report sources of high roller income, according to a report in the Las Vegas Review-Journal. The specter of government officials prying into these big spenders and their dealings went through the industry like “a magnitude 7.0 earthquake,” Review-Journal writer Howard Stutz wrote last week.
Title 31 of the Bank Secrecy Act is designed in part to thwart money laundering. At last year’s G2E Expo in Las Vegas, Jennifer Shasky Calvery, director of the Financial Crimes Enforcement Network, said casinos could be subject to the same requirements as banks and other businesses dealing with large sums of cash.
“Every financial institution, casinos included, should be concerned about its reputation,” she said. “Integrity goes a long way.”
The American Gaming Association has issued a statement saying it “is actively engaged with key federal agencies” in discussing the matter. Casino owners fear intense scrutiny could drive moneyed gamblers to more lenient markets, like Macau and Singapore.
“This is a serious issue that could radically alter the way that casinos do business,” AGA President Geoff Freeman said in the statement.
Nevada’s anti-money laundering law was eliminated in 2006. According to Stutz, “Regulators said the rule became obsolete because the federal government took over the tracking of large cash transactions.”
Fred Curry, of Deloitte Financial Advisory Services, says the crackdown is coming and the industry should prepare by choosing to police itself. “Casinos should be working now to get ready for the FinCEN announcement and improve their anti-money laundering programs.”
Recent probes illustrate the government’s zeal to weed out illegal transactions. Last August, the Las Vegas Sands Corp. paid a $47.4 million to settle a money-laundering investigation at the Venetian. In that case, a Chinese-Mexican businessman named Zhenli Ye Gon caught the feds’ eye when he wagered $84 million in a single year.
Last October, Caesars Entertainment Corp. acknowledged in a Securities and Exchange Commission filing that Caesars Palace was being investigated for possible money-laundering.
Reno-based gaming consultant Ken Adams wrote in the CDC Gaming Reports that the more attention from the federal government could “cost casinos a great deal.”
