A gaming lawyer and former UNLV professor said pressure on executives to produce revenue has prompted casinos all over the world to turn a blind eye to criminal activity.
Resorts World Las Vegas is one. Its fine of $10.5 million over its failure to comply with federal anti-money-laundering laws is the second highest in Nevada history. It was levied by state regulators over the casino allowing illegal bookmakers to gamble millions of dollars.
Anthony Cabot said he’s not surprised by the amount of the fine as a part of a stipulated settlement that will be reviewed Thursday by the Nevada Gaming Commission. It’s second only to a $20 million fine levied against Wynn Resorts in 2019 for failure to investigate sexual-misconduct allegations against former Wynn CEO and Chairman Steve Wynn.
“For the last several years, the Gaming Control Board has been assessing substantial fines against many of the larger casino companies,” said Cabot, who recently spoke on casino ethics at the World Game Protection Conference in Las Vegas. “That signals the industry that self-regulation needs to be a priority. Otherwise, casinos risk suffering significant monetary fines.”
In September, Wynn Resorts agreed to pay $130 million to the federal government to settle criminal allegations that it conspired with unlicensed money-transmitting businesses worldwide to transfer funds to benefit itself. The Gaming Control Board has yet to take action against Wynn in light of the federal fine being levied.
In December, Scott Sibella, former president and COO of Resorts World Las Vegas and former executive at the MGM Grand, had his gaming license stripped after pleading guilty to federal charges for failing to report illegal gamblers playing at MGM Grand in 2018.
“The industry needs to rethink a lot of its regulatory strategies. Far too much pressure is put on casino executives to raise revenue from the casino and those pressures sometimes take precedence over compliance and ethics,” Cabot said.
Australia has been besieged by money-laundering cases over the last 18 months involving criminal gangs from mainland China gambling with Star Entertainment and Crown Resorts. Crown was fined $300 million in July 2023 by the Federal Court of Australia. In 2022, Star Entertainment was fined $62 million for its anti-money laundering protocols. Last October, it was fined another $10 million and had its license suspension extended until 2025; its Sydney casino is now operated by a court-appointed manager.
What has happened in Australia, as well as Vancouver, British Columbia, are some of the worst regulatory violations in decades, according to Cabot, the author of forthcoming book by Huntington Press titled Casino Redux: Unveiling the Global Network of Chinese Organized Crime. It delves into the tales of legendary Triad leaders, charting their rise to power and their strategic maneuvers to gain a foothold in the lucrative global casino industry in Asia, Australia, and North America.
“On an international basis, casino ethics are horrendous,” Cabot said. “I wrote the book because I was astonished at the lack of ethics. In Australia, it wasn’t an employee crossing the line; it was institutional. It doesn’t shock me what happens in Macau, Laos, Cambodia, and even the Philippines. But this same model imported into Australia on a massive scale was shocking to me.”
While the U.S. has had lapses, those cases were isolated, uncovered, and nowhere near the same scale of what was happening abroad, according to Cabot. He said the facts behind the Wynn case aren’t known at this time, but would come out in any Gaming Control Board discipline.
“Some of these worldwide cases are backed by the Triads and others aren’t,” Cabot said. “Someone in China accumulates a lot of money either legally or illegally and wants to transfer a big portion of it into some Western country banking system. Casinos are a good way to do that, because casinos are cooperative.”
Cabot is disappointed by Australian regulators not stripping gaming licenses over “some of the most egregious regulatory violations I’ve ever experienced” (with billions of dollars going through casinos). “The offending companies are found unsuitable to hold a license, but they’ve never actually been revoked. I think that casino companies can be too big to fail is a bad message. Despite high fines, it takes one of the major deterrents to regulatory compliance off the table.”
As for Nevada, Cabot said, “Things are generally better than before the AML laws.” Nevada does a better job of keeping operators in line than other jurisdictions, although he would like to see some changes.
“A significant problem is that Nevada has to revisit the statutory and regulatory authority to make sure that they have the ability to fine the people who actually commit the violations, as opposed to whoever is left standing after they leave the company. Effectively, in a lot of the cases, the offenders will leave the company and the company will still get a large fine, but the people paying the fine had nothing to do with the violation. It effectively harms the shareholders instead of actually going after the offenders.”
The complaint against Resorts World filed in August was originally a 31-page document that has since been amended to 27 pages and reduced from 12 counts against the operator to 10. The Nevada Independent cited Gaming Control Board Chair Kirk Hendrick as saying that after further discovery, Resorts World “had conducted sufficient enhanced due diligence and other compliance reviews” regarding two of the individuals, Edwin Ting and Chad Iwamoto, who were named in the original document. “As a result, the counts regarding those patrons were removed,” Hendrick said.
Resorts World released a statement on the settlement hearing on Friday.
“Resorts World Las Vegas has reached a pending settlement with the Nevada Gaming Control Board (NGCB). We look forward to the Nevada Gaming Commission considering the settlement and ultimately resolving this matter.”
The Resorts World case involving illegal bookmakers has nothing to do with what’s been happening with Chinese money laundering at casinos worldwide, but operators thinking it’s what everybody else is doing in the industry is a problem, Cabot said.
“That’s been going on for a long time, but if you’re doing proper due diligence on your customer, at some point you recognize the money is coming from illicit sources and you have to cut off the customer.”
The biggest problems in Las Vegas, meanwhile, have long been curtailed. When Cabot arrived in Las Vegas in the late 1970s, foreign millionaires brought bags of cash to the casino cages on the Las Vegas Strip, but that went away with federal AML regulations.
“It was perfectly acceptable to take bags of cash, but that has disappeared from the landscape (in the U.S.). That’s why it’s so shocking to see in those other jurisdictions.”
