Financial institutions remain reluctant to share private data on clients and transactions with each other despite existing legal protections out of fear that they might nevertheless expose themselves to civil or criminal liability, according to sources.
A Northern Mariana Islands casino will forfeit approximately $3 million to the U.S. Justice Department under the terms of a deal reached Thursday that will spare the gambling operation criminal charges.
At least two large U.S. banks have started asking their casino clients more questions in the wake of disclosures that federal officials are investigating alleged violations of anti-money laundering laws.
Several of the largest casinos in Nevada are strengthening their Patriot Act controls in the wake of an investigation into Las Vegas Sands Corp. for insufficiently vetting risky clients.
Poor compliance efforts by gambling operations are translating into regulatory risks for the financial institutions that bank them, according to anti-money laundering consultants.
The expansion of the casino industry to new states throughout the U.S. increases the likelihood that gaming will grow as a vehicle for money laundering, particularly since the federal agency charged with its oversight is understaffed, according to law enforcement officials and former IRS auditors.
Banks need better legal safeguards when sharing customer information with other financial institutions in mortgage fraud investigations, say bank compliance professionals. At least one bank industry group wants to get Congress to consider such safeguards.