Feds probing breaches in filing laws?

May 6, 2003 7:08 AM

Lawyers for the Financial Crimes Enforcement Network have refused to say whether the U.S. agency is investigating three Nevada casino companies that together have failed to report thousands of cash transactions as required by federal law.

"We cannot confirm or deny the existence of any nonpublic investigation," reported a source in chief counsel’s office of the federal agency, part of the U.S. Department of the Treasury, in Vienna, Va.

The network, known as FinCEN, investigates potential money laundering cases ”” involving casinos, banks, real estate and other businesses ”” for the Treasury Department and can recommend fines of $25,000 for each violation. The Nevada Gaming Control Board can also fine violators in like amounts under state Regulation 6A.

The gaming board has completed its own look into why the Mirage hotel, owned by MGM Mirage, failed to file a mass of 15,000 cash transaction reports that had piled up for more than year.

The board also investigated two instances of paper lapses involving the Las Vegas Hilton, run by Park Place Entertainment, which has agreed to pay a fine of $75,000.

And the board is still probing Station Casinos after the casino firm recently acknowledged that employees of the Santa Fe Station did not send in hundreds of the reports to the feds.

Gaming Board member Scott Scherer said that he hadn’t heard whether FinCEN was investigating the recent rash of filing failures in Las Vegas. In the case of the Mirage, however, it appears as though the paperwork was simply set aside and not sent.

"There is nothing to indicate any criminal activity or intent" by the Mirage, Scherer said. "There was no customer trying to launder money, or any attempt to evade the (filing) requirement."

FinCEN on March 25 began requiring Nevada casinos to file suspicious activity reports, or SARs, which detail possible cases of money laundering, directly to the agency’s computing office in Detroit, and no longer to the gaming board, which now monitors the reports only through federal databases.

Casinos in Nevada that gross more than $10 million a year also send FinCEN copies of cash transactions reports — IRS form 8852 -- on people who exchange more than $10,000 within a 24-hour period.