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FinCEN Reports Increase in Casino Filings

The Financial Crimes Enforcement Network (“FinCEN”), a division of the US Department of Treasury, has reported a significant increase in filings made by casino and card room operators between March 1, 2012, and December 31, 2014.

Total suspicious activity report (SAR) filings from casinos and card rooms increased from 2,119 in 2012 to 46,575 in 2014. For Michigan, total SAR filings increased from 71 in 2012 to 2,420 in 2014. The state was the sixth highest in casino-related SAR report filings, representing approximately 4.6% of the total national filings made by casino and card rooms over the nearly three year period.

FinCEN reported that the top three suspicious activity types across the industry that triggered filings were: 1) minimal gaming with large transactions (15,907, 13.7%), 2) altering transactions to avoid a reporting requirement (13,475, 11.6%), and 3) miscellaneous casino-related transactions (13,305, 11.5%).

The increased number of reports filed reflects the gambling industry’s continued focus on compliance with federal financial policy. In a statement delivered at the 2015 Bank Secrecy Act Conference in June, FinCEN Associate Director of Enforcement Stepahnie Brooker stated that “[l]ast year, FinCEN Director, Jennifer Shasky Calvery, addressed the conference to highlight the critical role that casinos and card clubs play in keeping our financial system safe from potential money laundering and terrorist finance. There is a high level of attendance at today’s conference, which tells me that the casino industry continues to show a strong interest in developing a deeper understanding about these issues.”

FinCEN has taken enforcement action against casinos over the past two years, including imposing remedial compliance framework and audits, as well as assessing civil monetary penalties for compliance program deficiencies and extensive reporting failures. Enforcement action has also been taken against an individual employee that assisted patrons in attempts to avoid reporting requirements.

 

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