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Hawaiian Gardens Casino Part of Money Laundering Probe: Could Lose License

Written by:
Guest
Published on:
Jan/04/2017

A Los Angeles area casino, the Hawaiian Gardens Casino, may lose its gambling license following accusations made by the California Bureau of Gambling Control that executives of the property failed to comply with federal anti-money laundering laws.

The Gardens Casino has already admitted to deficiencies in its ability to obey the federal law, according to state and federal officials.

“In view of that nondisclosure and admitted violations of federal and state laws, respondents continued licensure undermines the public trust that licensed gambling does not endanger the public health, safety and welfare,” the accusation reads.

A hearing on this matter is yet to be scheduled and, as such, the casino will be allowed to remain open.

From the Press-Telegram:

The Financial Crimes Enforcement Network, or FinCEN, is part of the Treasury Department and announced its issuance of a $2.8 million fine against Gardens Casino this past July. That fine followed Internal Revenue Service examinations and casino management’s admission of failures to abide by the Bank Secrecy Act that resulted, in the government’s words, in making the casino “susceptible to money laundering and terrorist financing activity.”

FinCEN reported that Gardens Casino was in violation of this law over a period extending from September 2009 through July of last year. Gardens Casino’s managers did not implement controls needed to follow federal law despite a 2011 IRS examination and a 2013 consultant’s review that brought problems to light.

Those problems included casino personnel’s failures to keep track of exactly who was involved in cash transactions there, according to FinCEN. In one case, a woman known only as “Michelle” was referred to in 15 suspicious activity reports and five currency transaction reports, but casino personnel had no records of her actual identity.

The same “Michelle” and others believed to be her agents were able to continue activities at Gardens Casino even though she did not identify herself to casino employees on at least three separate occasions. According to FinCEN, casino managers told the IRS they did not think they had to prevent Michelle or others who refuse to provide identification from transacting business there and that doing so may result in customers switching to other Southern California casinos.

It was also noted that 347 cash transactions involving unknown parties between

Oct. 1, 2013 and Dec. 31, 2013 were for amounts between $9,000 and $10,000, which FinCEN observed are just short of the level that triggers mandatory reporting.

The casino has just completed a $90 million renovation. 

- Aaron Goldstein, Gambling911.com

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