FinCEN’s findings revealed that these lapses persisted for more than four years, beginning in September 2014 and extending into early 2019
The Financial Crimes Enforcement Network (FinCEN) just slapped a $900,000 fine on the Lake Elsinore Hotel and Casino in California. This marks FinCEN’s first move against a casino in six years.
Alleged BSA Violations Lead to Penalty for Lake Elsinore Casino
The penalty is part of a deal to settle alleged violations of the Bank Secrecy Act (BSA). FinCEN claims the casino ignored key anti-money-laundering (AML) measures for a long time. This neglect put both its customers and the wider US financial system in danger.
The Lake Elsinore casino situated between Los Angeles and San Diego failed to set up and keep proper compliance measures under the BSA. FinCEN’s probe revealed that the casino did not submit the required Currency Transaction Reports (CTRs) and Suspicious Activity Reports (SARs), which are key filings meant to spot and report transactions that might point to unlawful financial activity. FinCEN’s discoveries showed that these oversights lasted for over four years starting from September 2014 and continuing into early 2019.
The choices made by Lake Elsinore’s management caused these compliance problems. The casino put its general manager and chief operations officer on the compliance committee. Neither had experience with BSA rules, which FinCEN said played a big part in their weak AML program. This oversight meant many potential shady deals were not reported. As a result, police missed out on key info about money laundering and other money crimes.
Director Andrea Gacki Emphasizes the Importance of BSA Compliance for All Financial Institutions
The enforcement action reminds all financial institutions that they must follow federal AML laws. This warning comes from FinCEN and applies across the board.
FinCEN’s Director, Andrea Gacki, stressed how crucial it is to comply with these rules. She cautioned that not meeting BSA requirements puts financial transparency at risk and threatens national security.
Gacki further commented: “Lake Elsinore operated for years without the most basic AML controls, putting its customers and the US financial system at risk and denying law enforcement information on suspicious activity. This action should serve as a reminder that all financial institutions—regardless of their type or size—must comply with their obligations under the BSA and FinCEN’s regulations.”
Besides the money penalty, the deal requires Lake Elsinore to make big changes to its AML program. This includes getting a FinCEN-approved independent AML expert to watch over the casino’s compliance with standards.
This check aims to bring the casino’s AML practices up to federal standards. If the casino updates its program, FinCEN has agreed to cut the fine by $50,000 lowering the penalty to $850,000.This enforcement action is also the first time FinCEN and the California Department of Justice’s Bureau of Gambling Control have worked together. By teaming up on the case, both agencies want to show how crucial it is for California’s gaming establishments to follow regulations especially as the industry keeps expanding.
