A California casino faced a $500,000 fine amid ongoing enhanced scrutiny following its staff members’ failure to inform the competent authorities when a high-roller took bags with $100 million in cash to the venue to use on games of baccarat.
The high-roller customer, which was only described as a Chinese national, visited the Los Angeles County-based Bicycle Hotel & Casino approximately 100 times in a period of 8 months back in 2016. According to federal prosecutors, the gambler would go to the casino’s VIP room to play high-stake baccarat, spending massive sums of money that he brought in and out in duffle bags. Reportedly, the customer would have cash-in or cash-out transactions initiated on his behalf by his assistant, with the overall value of the transactions estimated at over $100 million.
The casino failed to notify the local officials about the suspicious activity of the high-roller gambler during the alleged incidents. Furthermore, the gambling venue’s staff improperly filed the reports about the aforementioned currency transactions in the name of the assistant rather than the actual customer.
The management of the casino was informed about the compliance failures by staff members in late July 2016. The then-received information pushed the casino to amend its reports of the currency transactions to include the name of the high-roller customer and regularly file reports questioning the player’s source of funds.
Non-Prosecution Agreement Reached between the Casino and the Authorities
Competent authorities raided the California casino in 2017 in order to investigate wrongdoings that could be violations of money laundering rules.
As revealed by the Department of Justice, the probe revealed that the casino and hotel venue failed to properly file reports in the period from January 7th, 2016 to July 27th, 2017 about the cash transactions initiated by the Chinese national. Reports say that in one instance, the high-roller customer made a withdrawal worth $2 million from his player account and had a gaming session that lasted for almost 12 hours.
The casino staff members failed to report his activity even though casinos are required by law to record and report the details of transactions worth more than $10,000 in cash by any of their patrons.
The attorney of the California casino explained that the gambling venue has acknowledged the mistake and has moved to make some amendments to its filings. He further noted that the Bicycle Hotel & Casino remains devoted to making sure that it complies with all reporting programs as required by gambling laws and regulations.
A few days ago, federal prosecutors reached a Non-Prosecution Agreement with the Bicycle Hotel & Casino. Under the deal, the casino is required to pay a monetary fine of $500,000 and also enhance its protocols regarding anti-money laundering.
The Non-Prosecution Agreement was reached in recognition of the casino’s efforts to enhance its program aimed at preventing money laundering and its pledge to cooperate with local authorities during the probe. As part of the deal, the Bicycle Hotel & Casino would also have to implement some additional requirements regarding review and reporting, including a third-party audit and regular reporting to the US Attorney’s Office. Under the provisions of the Non-Prosecution Agreement, the casino would be also expected to cooperate with any additional investigations and proceedings held by law enforcement officers.
For the time being, it remains unknown whether the Chinese high-roller customer is facing any criminal charges or is under investigation.