Banks are largely ignoring requests made by casinos under a confidential data-sharing program designed to combat illicit finance, according to sources. In June, the U.S. Treasury Department reported that 98 casinos and card clubs had registered for the Patriot Act 314(b) program, which authorizes financial institutions to share confidential information on high-risk customers with designated officers at other institutions to bolster overall efforts to report suspicious activity and identify financial criminals. The program grants safe harbor from potential civil litigation to registered financial institutions that have adequate privacy and data security protections in place and choose to respond to requests...
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.
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.