Hawaiian Gardens Casino levied $2.8m fine by FinCEN for AML lapses

 Marie Kelley

 

 July 18, 2016

 

The United States Financial Crimes Enforcement Network announced this past Friday that they were able to reach an agreement with the owners of the Hawaiian Gardens Casino, a card club of California, for violations the venue faced based on the Bank Secrecy Act. The casino will have to pay a $2.8m fine for being in violation of anti-money laundering regulations.

The Financial Crimes Enforcement Network reported that the casino was investigated by the Internal Revenue Service in regards to the Bank Secrecy Act back in 2011 and three years later, in 2014. The IRS were able to uncover several violations from 2011 that had still not been dealt with by 2014. An independent consultant from the Hawaiian Gardens Casino identified the same issues a year earlier, in 2013.

The violations against the Hawaiian Gardens are in relation to several issues with the Bank Secrecy Act. The venue did not have an effective anti-money laundering program in place that was implemented and maintained. The venue did not report large cash transactions and did not file activity reports that were found to be suspicious. Required records were not always kept in regards to game play.

Financial Crimes Enforcement Network collected the information of customers at the venue by using player club cards and have stated that 80% of the suspicious activity reports that were filed by the venue from early 2013 to late 2014 included at least one unknown subject. The Financial Crimes Enforcement Network stated that the investigation shows a lack of interest by the casino to use all the tools available to them which allowed transactions to be anonymous and ‘frustrated record keeping’.

During investigations, it was found that staff of the Hawaiian Gardens were involved in helping customers to create transactions that could be kept from the reporting thresholds set by the federal government. It was found that the venue continued to work with individuals who had been identified as suspicious, by the actual casino, even when the individuals would not show identification. According to CalvinAyre, one suspect was able to take part in gaming at the Hawaiian Gardens even after 15 suspicious activity reports were filed against the player.

Jamal El-Hindi is the Acting Director of the Financial Crimes Enforcement Network who commented on the matter, stating that the Hawaiian Gardens was lacking a culture of compliance and had allowed these violations to go on for years after ignoring the findings by the IRS as well as their own consultant.

On a side note, the Hawaiian Gardens is partnered with PokerStars, the online poker brand who is trying to be involved with online poker gaming within the state of California if regulations are put in place. PokerStars, owned by Amaya Gaming, partnered with the card room, along with other cards rooms and certain Indian tribes in the state to be ready for when online poker legislation passed.

However, legislation efforts have stalled and PokerStars is a hot point of contention as certain groups do not want to see the brand being able to operate once legislation is put in place. The violations of the card room may be a further deterrent for the online poker brand as they try to be included in the online poker operations in California.

Hawaiian Gardens opened a $90 million renovation and expansion earlier this year.

https://news.worldcasinodirectory.com/hawaiian-gardens-casino-levied-2-8m-fine-by-fincen-for-aml-lapses-31100

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MASHPEE WAMPANOAG

Judge narrows focus of suit brought by casino foes

Interior Department's land trust decision now key issue

By George Brennan

Posted Jun. 29, 2016 at 7:09 PM 

BOSTON — Arguments over dismissing parts of the federal lawsuit brought by East Taunton neighbors against the U.S. Department of the Interior are on hold and, instead, a federal judge will narrow his focus to one key issue that paved the way for a Mashpee Wampanoag casino.

On July 11, U.S. District Court Judge William G. Young will consider dueling summary judgment motions having to do with how the tribe’s land application was approved given a 2009 U.S. Supreme Court ruling, known as the Carcieri decision. In that ruling, the nation’s highest court called into question the Interior Department's ability to take land in trust for tribes recognized after 1934, the year of the Indian Reorganization Act.

The Mashpee tribe was federally recognized in 2007.

The court approved the stipulation before yesterday’s motion hearing in Boston, so the session was put on hold, said David Tennant, an attorney for the East Taunton plaintiffs.

“We’re dealing with the Carcieri issue as a standalone,” he said. “Everything else is in hibernation.”

Earlier this month, Young decided not to hear arguments for an injunction sought by the neighbors and instead said he would put the trial on the fast track. He had scheduled yesterday’s motion hearing and a July 11 trial. Instead that July 11 date will now be used for the cross motions for summary judgment.

Each side must file motions July 7 and will be able to make oral arguments July 11, Tennant said.

The suit alleges that the Interior Department circumvented Carcieri to approve the tribe’s land application by using a definition of “Indian” and “reservation” that doesn’t fit the Mashpee tribe.

“The Mashpees did not meet their burden to prove that they were tribally organized and exercised tribal jurisdiction over their lands and people in 1934, much less that they were recognized by the federal government for doing so and fell under federal jurisdiction in 1934,” the suit states.

Interior’s record of decision points to the tribe’s historic ties to both Mashpee and Taunton and finds that the tribe members meet the second definition of “Indian” — descendants of a recognized Indian tribe — and that the tribe’s “continued control and occupation” of Mashpee as of 1934 constitutes a reservation.

The Mashpee Wampanoag Tribe is not a party to the suit because it targets the Interior Department’s decision. Still, the tribe has a keen interest in the outcome.

In September, the Interior Department agreed to take land in trust in Taunton and Mashpee for the tribe’s initial reservation. The tribe has begun construction of First Light Resort & Casino in Taunton and has targeted next summer to open phase one of the Indian casino.

Plans for the casino, which will cost an estimated $600 million to build, include three hotels, a gaming room with 3,000 slot machines, 150 table games and 40 poker tables. The first phase is expected to feature a gambling floor with about 1,900 slot machines, 60 table games, and some restaurants.

http://www.capecodtimes.com/news/20160629/judge-narrows-focus-of-suit-brought-by-casino-foes

Genting Will Just Try to Sue Its Way to a Casino in Downtown Miami

THURSDAY, MAY 12, 2016

BY KYLE MUNZENRIEDER

Gentin's original plans for Resorts World Miami Courtesy of Genting

Three years ago, two short, 150-meter horse races began in Miami-Dade County and ended in Broward, so now Malaysian gambling conglomerate Genting should be allowed to operate a casino near downtown Miami. Or, at least, that's the oversimplified take on a lawsuit Genting has filed against Miami-Dade County and State Attorney Katherine Fernandez Rundle. 

Five years ago, Genting plopped down $236 million to buy theMiami Herald's former bayfront headquarters andunveiled ambitious plans to build a lavish megaresort and full-service casino on the primo property. This despite the fact that such casinos aren't allowed in Florida under the law. Genting took a bet that the state government would rush through some changes to the gambling laws to accommodate them, but, so far, they've come up losers. It shouldn't be a surprise. They weren't the first company with big dreams and an even bigger fortune to try to get gambling expanded in the state. 

Well, just weeks after rumors surfaced that Genting may try and sell its property and walk away from the project, the Malaysian conglomerate is back with a last-ditch lawsuit to allow them to operate a slot machine and card games at the Omni building. 

Under Florida law, operators of pari-mutuel gaming facilities (i.e. horse and dog racing tracks) are also allowed to run a limited number of card games and slot machines. Back in 2014, Genting reached an agreement with Gulfstream Park to transfer their quarter-horse permit. Gulfstream mainly runs thoroughbred races under a separate license anyway. 

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In fact, Gulfstream has only maintained a quarter-horse permit in hopes of one day operating a casino in Miami-Dade anyway. That was their plan long before Genting was in the picture, and the permit is technically currently owned by a separate nonprofit. 

Shortly after purchasing the Herald site, Genting also went on a shopping spree that included the nearby former Omni Mall building.

While occasional quarter-horse racing remained at Gulfstream, Genting wanted to operate the associated card room and slot machines out of the Omni. Though, a judge ruled that the Broward-based Gulfstream couldn't transfer their permit across county lines. 

Gulfstream Park is based in Broward County, but some of its land does stretch over into Miami-Dade.

And it turns out that whenever Gulfstream does run an occasional quarter-horse race in order to maintain the permit, they make sure that it starts on the small part of its land that is in Miami-Dade. 

According to the Herald, Genting and Gulfstream signed a nominal $1, one-year lease back in April and have now filed a preemptive lawsuit against the county and Rundle. 

Essentially, they're asking a judge to agree that the permit is valid in Miami-Dade and to bar any police or regulators from taking action against them from running a casino in the county. 

The Next Miami was the first to report the suit. 

genting—The Next MiamiDocs.com

Yes, it's a complicated legal maneuver, and ultimately it will be up to the courts to decide if there's any merit to the argument. 

It's not surprising that Genting operates with a gambler's mentality. They take a lot of big risks. A lot of them fail, but if they get lucky on one deal they can end up winning big time. 

http://www.miaminewtimes.com/news/genting-will-just-try-to-sue-its-way-to-a-casino-in-downtown-miami-8452530

The Real Deal Magazine Genting sues Miami-Dade over gambling rights for downtown Miami site The Real Deal Magazine Malaysian casino operator Genting Group has filed a lawsuit against Miami-Dade County and the county's state attorney to allow Genting to operate a ...

Opponents of Taunton casino cast doubt on groundbreaking plans

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Tribal Council Chairman Cedric Cromwell said that three firms – Dimeo Construction Company, The Penta Building Group, and Talako Construction – will begin pre-construction for Project First Light, with a possible groundbreaking date of April 5.“It could be a false bravado,” said Adam Bond, the Midd...

TAUNTON – Opponents of the Mashpee Wampanoag Tribe’s casino project in Taunton said that the financial backers of the gaming destination would proceed at their own risk if they go forward with a groundbreaking planned for early April.

After the Mashpee tribe announced its plans to break ground on a $500 million casino in Taunton, a lawyer for a group of citizens that filed a lawsuit to stop the project said on Tuesday that the construction project could be a waste of money.

“They do so at their own risk,” said Adam Bond, the Middleboro-based attorney who helped file the lawsuit challenging the U.S. Department of the Interior decision to grant land in trust for the tribe in Taunton. “It doesn't change the lawsuit that is pending.”

On Tuesday, Tribal Council Chairman Cedric Cromwell published a statement that three firms – Dimeo Construction Company, The Penta Building Group, and Talako Construction – will begin pre-construction for Project First Light, with a possible groundbreaking date of April 5. The Mashpee Wampanoag Tribe has long told the government and the public that it has the financial backing of the Malaysian multinational Genting Group.

Bond said that the tribe's announcement of an April groundbreaking could be an attempt to convince the Massachusetts Gaming Commission, which is deciding on whether to award a commercial license for a Brockton casino project, that the Taunton project will not be stalled or halted by the federal lawsuit.

“It could be a false bravado,” Bond said. “It could be real. I don't know. I'm not focused on their tactical discussions. ... The gamble is theirs, or their financiers’. It's at their own risk.”

Bond said the tribe is scheduled to respond in federal court to the Taunton group’s lawsuit in early April, just before the scheduled groundbreaking.

The state commission previously stated that it is considering the “tribal status” of the Mashpee Wampanoag Tribe, as it decides whether to award a license to Mass Gaming and Entertainment, the group behind the Brockton bid. That status is the crux of the lawsuit filed on behalf of the Taunton citizens group, pointing to the precedent set by the 2009 U.S. Supreme Court decision in Carcieri v. Salazar, which stated that the benefits of the Indian Reorganization Act of 1934 are limited to tribes that were "now under federal jurisdiction" at the time of the law's passage.

The Mashpee tribe was not federally recognized until 2007, but members claim they have been under federal jurisdiction for many generations. The Taunton citizens group points to historic government documents to deny that claim.

The effect of lawsuit is a crucial consideration for the gaming commission, which is concerned about the potential for market oversaturation, with two potential casinos located close to each other. The Massachusetts Gaming Commission recently said that it now plans to make a decision on the Brockton casino in late April.

Neil Bluhm, chairman of the Chicago-based Rush Street Gaming, the parent company of Mass Gaming and Entertainment, has repeatedly stated during public meetings with the gaming commission that the Mashpee tribe may say it’s going to start construction, but that when it comes down to it, he doubts the tribe’s financiers will invest seriously in the Taunton casino project with a serious lawsuit looming overhead. Bluhm recently helped fund the Taunton group’s lawsuit, and the tribe has repeatedly stated that Bluhm’s claims are dubious.

“We are not questioning Genting’s resources,” said Bluhm, during a November hearing for the proposed Brockton casino. “The question is, would a sound businessman want to risk that kind of money in light of the potential reversal of this case? You might say, initially I will, but once you get down to it, would you really do it? But one thing I think is absolutely clear, a lender is not going to take this kind of risk. This would require 100 percent equity or a guarantee. And this is a binary decision. If courts hold you can’t have a casino (in Taunton), there will be no casino. And all of that money is going to be lost. So, that’s a pretty hefty decision for anyone to make in light of the legal analysis.”

The Mashpee Wampanoag Tribe is scheduled to speak about the legal matter with the Massachusetts Gaming Commission on March 15 during a public meeting at 1 p.m.

Look below to view a copy of the lawsuit filed by the Taunton citizens group against the U.S. Department of the Interior, over its decision to grant land in trust for the Mashpee Wampanoag Tribe.

http://www.enterprisenews.com/article/20160308/NEWS/160306113

Sydney’s Star and Las Vegas casinos used to launder millions in criminal network police say

 Kim Morrison

 September 13, 2015

Australia, Casino News, Conspiracy, Fines, Lawsuits & Litigation, Latest Casino and Gambling News, Money Laundering, Nevada, World Casino News

Five men believed to be part of a criminal network involving international drug trafficking and money laundering were arrested in the U.S. and Australia this week following a four-year joint criminal investigation between New South Wales law enforcement and the FBI.

Police allege that Andrew McManus, at one time a leading concert promotor in Australia, known drug kingpin Craig Haeusler, and McManus’ London attorney Michael Croke, along with two other men, were part an illegal scheme that utilized Sydney’s The Star casino as well as Las Vegas casinos to launder millions of dollars generated from international cocaine smuggling.

The investigation was fueled by the May 2011 discovery of a suitcase containing approximately $702,000 in cash at a Sydney Hilton hotel room where former cage-fighter Sean Carolan was in possession of it. Police received an anonymous tip that a hotel guest in Carolan’s room was seen with a gun, but upon arrival only found Carolan and the black suitcase full of cash. Carolan told police that he was holding the money that belonged to his business partner in the company Advanced Peptide Solutions, Owen Hanson Jr, to prevent Hanson from losing more at the casino, directly conflicting with McManus’ claim to police in 2012 that the money was proceeds from Lenny Kravitz tour and not from crime. As obtained on the Sydney Morning Herald, in an April 2012 police interview McManus said, “I gave someone 700 large, and you’ve found someone with 700 large. It’s my 700 large, “and that, “It’s not the proceeds of crime, it’s the proceeds of Andrew McManus.” The Supreme Court ruled against Carolan and the “700 large” remains in the safekeeping of New South Wales officials.

Police allege that the cash found was proceeds from a cocaine deal. The funds were supposed to go to The Star casino where a professional gambler would launder it. According to police there is no indication that The Star casino had any knowledge of the gambler’s illegal activities.

Among the other arrests resulting from the criminal investigation, McManus was placed into custody by police at Melbourne Airport on Thursday and has been charged with making false statements, involvement in a criminal group, and preventing the course of justice, both charges related to the cash. He was released on bail that evening and is scheduled to appear in court on October 14 in Sydney.

http://news.worldcasinodirectory.com/sydneys-star-and-las-vegas-casinos-used-to-launder-millions-in-criminal-network-police-say-13489