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US – AGA releases Anti-Money Laundering Best Practices

By - 5 December 2014

The American Gaming Association (AGA) has released a comprehensive set of Anti-Money Laundering (AML) Best Practices to guide the efforts of casinos to protect the US financial system and national security from money laundering and other forms of illicit finance.

TheAGA’s Best Practices for Anti-Money Laundering Compliance are the result of more than a year of work to identify and enhance industry guidelines, which were developed in coordination with the Financial Crimes Enforcement Network (FinCEN).

“Today marks a milestone for the gaming industry, which has come together to develop the first-of-its-kind, forward-looking set of Best Practices that reflect our industry’s commitment to a strong culture of compliance,” said Geoff Freeman, president and chief executive officer of the AGA. “We look forward to further bolstering our partnership with FinCEN to prevent money laundering and protect the integrity of the U.S. financial system.”

Casino companies have developed risk-based programs that promote compliance with the legal requirements of the federal Bank Secrecy Act (BSA) and associated AML regulations to discourage illicit behavior and safeguard the integrity of the casino industry. Risk-based compliance efforts are essential to the casino industry’s effective implementation of AML controls.

The Best Practices illustrate the industry’s commitment to a strong culture of compliance. They distill the procedures that a wide range of casinos have adopted across critical issues including customer due diligence, transaction monitoring and employee training. Notably, the document also sets forth a series of “red flags” that are specifically tailored to the gaming sector. Individual casinos have implemented a range of measures and guidelines that aim to prevent, detect and report efforts to present illicit funds at casinos.

The AGA added: “While the vast majority of patrons visit casinos for entertainment, those engaged in illegal activity may attempt to use the casino’s financial services to conceal or transfer illicit wealth. The release of the Best Practices is an important step toward achieving the goals the industry shares with regulators and law enforcement: protecting the integrity of gaming and keeping illicit funds out of our nation’s casinos.”

The basic framework of a BSA/AML compliance program involves the appointment of a compliance officer for the casino, the assignment of substantial employee time to compliance measures, and oversight of the compliance effort by a compliance committee, which includes representatives of the property’s operations and financial staff. In order to promote a culture of compliance, casinos also may want to consider periodic updates regarding their AML programs to the Board of Directors. This line of communication could include regulatory developments, changes to the program, resources, and audit findings, among other issues.

The AGA added: “These steps reflect the continuing efforts of the AGA members’ commercial casino operators to mitigate the risks of money laundering and illegal activity connected with their businesses. The guidelines in this document must be adapted to match the specific circumstances of individual casinos and companies. When dealing with businesses as complex as modern casinos, and with judgements as subjective as those required by the BSA, no compliance effort can be perfect or immune from retrospective re-evaluation. Casinos should reconsider their AML/BSA compliance efforts on a regular basis to ensure they account for new risks and emerging patterns of illegal activity. Though perfection cannot be expected of a process that involves so many variables and periodic shifts in financial practices and regulations, effective AML/BSA compliance programs should ensure that the gaming industry continues not to attract significant illegal money laundering activity.”

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