Gardens Casino at Risk of Losing Gaming License

Gardens Casino, California

Gardens Casino, CaliforniaAfter spending $90 million on renovations, the Gardens Casino may lose their right to operate.

Often times, casinos in the United States face legal troubles due to a number of factors. Casinos have to pay fines due to violating regulations in their given state. Other times, casinos may face lawsuits from other venues or tribal operated facilities. There are a number of reasons why a casino can face legal issues. In California, the Gardens Casino now faces a problem of losing their operating license, which could not come at a worse time than when the venue spent $90 million on renovations.

What’s Going On?

On October 17th, the California Bureau of Gambling Control accused the casino and certain officials of the venue of failing to report to officials of the state that operators did not comply with federal anti-money laundering law. The officials of the state Bureau of Gambling Control feel that this justifies revoking the gaming licenses that allow the casino as well as trustees to be in operation.

Those included in the accusation are Chief Executive David Moskowitz. The Gardens Casino has admitted that they failed to obey the law when it comes to the issue. The accusation reads:

CBGC Accusation

A hearing will be scheduled in the future to determine what will happen with the casino. However, they do have the option to stay open as of right now with a provisional license. This option is available until the 30th of November 2018. The casino has yet to comment on this announcement.

Fines over the summer

Back in the summer months, the Financial Crimes Enforcement Network, which is part of the Treasury Department, announced a fine of $2.8 million against the casino. The fine was presented after the IRS examined the company and found the admission of failures by the management of the venue resulted in the casino being susceptible to money laundering as well as terrorist financing activity.

The casino was found to have not abided by the Bank Secrecy Act which was created in 1970. The act requires that records are kept by businesses so that law enforcement officials can track illegal transactions when investigating cases of money laundering. A business must report a single cash transaction or related transaction when $10,000 or more is involved.

The Gardens Casino was found to be in violation of this law during a period that took place from September of 2009 until July of 2016. The managers of the casino did not implement controls that should have been put in place to follow the law even after an examination by the IRS was conducted in 2011 and a consultant review was completed in 2013.

Personnel of the venue failed at keeping track of who was involved in the cash transactions of the venue, as found by reports. One case involved a woman who had been involved with 15 reports of suspicious activity as well as five currency transaction reports. She was known as ‘Michelle’ but personnel did not have actual personal information on this person to determine her identity.

This was also not the only case of someone doing business with the venue without quality records being kept. From January of 2013 until September 2014, 80% of reports filed involving suspicious activity from the casino referred to at least one unknown individual being involved in the transaction. From October 2013 until December of that same year, 347 such transactions took place.

Back in November, the Gardens Casino submitted a request for license renewal with the California Gambling Control Commission. This is when the provisional license was approved. The casino must now await a hearing to see what will happen in this case.