Only days after federal authorities warned online gaming operators and banks about efforts by organized crime to launder money via online gaming, regulators in Ontario fined a Niagara Falls casino for violating financial regulations.
The Alcohol and Gaming Commission of Ontario (AGCO) announced that Fallsview Casino was fined $70,000 for “failing to meet requirements in place to minimize the risk of unlawful activity, including money laundering, at the gaming site.”
“The AGCO is committed to protecting the public interest and public safety and remains vigilant in its efforts to guard against potential money laundering at Ontario’s gaming sites,” AGCO CEO Dr. Karin Schnarr said. “Casino operators are important front-line partners in this effort and the AGCO holds all operators to rigorous standards when it comes to the prevention of unlawful activity.”
Details on the Case
The penalty stems from an incident in April in which a guest entered the Salon Privé, a private gambling area within the casino. The guest presented $80,000 in strapped $100 bills from a reusable grocery bag, the AGCO reports.
“Surveillance showed that once the money was counted and confirmed, the patron left the table with casino chips without playing at that time,” the AGCO noted. “Despite having previously identified the player as ‘high risk,’ the casino failed to notify the AGCO and on-site police of this transaction as required.”
The regulatory agency also notes the casino operator failed to take meaningful steps to determine the source of funds. Under anti-money laundering rules, casinos are responsible for determining the source of funds and flagging major transactions for regulators to investigate further.
Criminal organizations are known to use casinos to launder money. Large amounts of cash will be exchanged for casino chips and later exchanged again to make the cash look like it was won during gambling sessions.
Preventing potential criminal activities at Ontario’s gaming sites is a key priority for the AGCO. The Ontario Lottery and Gaming Corporation (OLG) owns several casinos throughout Ontario, which are managed by varying companies.
“Casino operators have an important role to play and must take steps to effectively identify and prevent criminal activity from occurring on their gaming sites,” the AGCO reported. “The AGCO, along with the Ontario Provincial Police bureau attached to it, continue to focus on the safety and security of gaming in Ontario and actively monitor all Ontario gaming sites for compliance with the standards.”
Registered gaming operators can appeal and that appears what Fallsview plans to do. The casino disagrees with the penalty and noted that “as a responsible gaming operator, Fallsview Casino Resort is dedicated to identifying and preventing unlawful activities.”
The company added that it has a culture and history of integrity and transparency, and a longstanding commitment to compliance in Ontario.
“We have reviewed the AGCO’s decision and respectfully disagree with it,” the casino noted in a statement. “Fallsview Casino Resort is a company devoted to compliance and good citizenship, we will be appealing the decision and look forward to presenting our case.”
The AGCO didn’t offer further details on the gambler who made off with $80,000 in casino chips and whether those had been cashed in at any point.
