The U.S. Department of the Treasury’s Financial Crimes Enforcement Network recently imposed a $900,000 fine against Sahara Dunes Casino, LP, doing business as Lake Elsinore Hotel and Casino (“Lake Elsinore”), for willful violations of the Bank Secrecy Act (“BSA”) and its implementing regulations between September 2014 to February 2019. FinCEN reported that this is first resolution reached in coordination with the California Department of Justice – Bureau of Gambling Control (‘CA-BGC”).
According to FinCEN, Lake Elsinore is a licensed “card club” located in California and a “financial institution” within the meaning of the BSA and its implementing regulations, which makes the casino subject to the Anti-Money Laundering (“AML”) program requirements in the BSA. As part of a settlement reached with FinCEN, Lake Elsinore admitted to willful violations of the BSA, including a failure to implement and maintain an effective AML program for more than four years. In the Consent Order, Lake Elsinore also admitted that it failed to file currency transaction reports (“CTRs”) and suspicious activity reports (“SARs”) as the BSA required and violated the BSA’s recordkeeping requirements.
While FinCEN imposed a civil money penalty of $900,000, it agreed to suspend $50,000 of the penalty pending Lake Elsinore’s compliance with obligations in the Consent Order, including the hiring of an independent consultant, subject to FinCEN’s approval, who will review the effectiveness of Lake Elsinore’s AML program and provide a report to FinCEN on the proposed scope and methodology of that program. Lake Elsinore also agreed, as part of its settlement, to fully cooperate with any FinCEN investigation related to or stemming from the current matter.