The U.S. Treasury Department may soon require the casino industry to “snitch” on some of their best customers by reporting the source of their gambling funds.
The Treasury Department’s Financial Crimes Enforcement Network (FinCEN) has made the decision based on people who are using the casino to launder money. FinCEN Director Jennifer Shasky Calvery stated that casinos may be subjected to the same regulations as financial institutions and other businesses.
“Every financial institution, casinos included, should be concerned about its reputation,” Calvery claimed at the Sands Expo and Convention Center. “Integrity goes a long way.”
One doesn’t usually associate casinos with integrity. That’s part of their appeal.
The “concern” over money laundering is likely a smoke screen for just another case of the government looking to collect money wherever they can. Title 31 of the Treasury Department’s Bank Secrecy Act would require casinos to investigate where big spending high rollers’ are getting their money, and last month, FinCEN announced it had plans to enact it.
This decision could have damaging repercussions for the gaming industry. Owners of casinos have long claimed that their patrons don’t want their privacy invaded, and will stay away from casinos if Title 31 is applied. During the recession, high-end customers playing Baccarat kept The Strip from going under. Gaming executives fear those customers will leave due to government interference.
Las Vegas faces some intense competition globally. They fear they will lose business to places like the wildly successful Macau resort in China. In the slowest economic growth in 24 years, China’s only legal gambling hall is one of the few booming industries, seeing a 13% increase in revenue from last year.
The American Gaming Association isn’t willing to surrender, and issued a statement saying it “is actively engaged with key federal agencies.” “This is a serious issue that could radically alter the way that casinos do business,” AGA President Geoff Freeman said.
Regulation 6A was an anti-money laundering law that Nevada had on the books till 2006, but it was deemed unnecessary by regulators because the federal government was overseeing large cash transactions by then. Las Vegas Sands Corp. was the recent subject of a money-laundering investigation at The Venetian. One of their clients was linked to international drug trafficking, and the company admitted it hadn’t properly investigated his transactions. They settled with federal prosecutors for $47.4 million to avoid criminal charges.
Federal prosecutors stated Las Vegas Sand Corp. complied with their orders, and commended their efforts to stop money laundering. While some in the gaming industry say it’s time for casinos to stop trying to dodge the bullet and comply with Title 31, others are looking at the government’s past involvement. Each time it’s wound up costing casinos, and it’s likely the American Gaming Association won’t give up its efforts to stop the government’s ever encroaching authority.
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