There are several key methods that criminals deploy when money laundering. Many groups rely on breaking up the deposits into small tranches to avoid flagging in a practice known as structuring. Others simply buy chips with cash, spend some time on the casino floor and attempt to cash them out as winnings. There are many methods that involve the use of shell companies to conceal transactions, bank accounts and individuals involved. It is an incredibly complex area of finance and one that the authorities are fighting tirelessly to stamp out in all forms.

What Makes Casinos the Perfect Target?

A Q&A on money laundering for casinos and online regulated poker websites. Executive Summary. Money laundering is a process in which so-called ‘dirty money’ from the proceeds of crime is transformed into ‘clean money’ or legitimate money or other assets, such as cars, art, homes or investments. Vegas casino’s attempt to collect a debt exposes world of Chinese high-rollers. In the post 9/11 era, with cash transactions under tighter control, Las Vegas casinos keep the money flowing in.

Casino gambling is a brilliant way to make money disappear, and reappear in separate bank accounts. Obviously, the casino industry takes measures to make this difficult which we will explain in more detail down the page. The casino does not necessarily need to be complicit in the money laundering activities for criminals to be successful, but many have known to be in the past. With so many underground markets operating throughout Asia, Europe and America – criminals have plenty of casinos and sports betting operators they can exploit to launder their dirty cash.

Without the compliance of the regulated casino industry, this is an uphill battle that the authorities cannot fight alone. There are many motivated, and well-funded criminal gangs that are persistent in their efforts to use casinos to launder money. Within the casinos, themselves exist many vulnerabilities that can be easily exploited. The staff in casinos represent one of the biggest risk factors for money laundering, as they are often low-paid administrative staff that can be easily bribed or threatened to assist the criminals laundering their money.

But what makes the casino money laundering so appealing rather than off-shore shell companies or other such methods.

The three biggest reasons for money laundering at casinos are:

Casinos and sports betting operators have enormous cash flows that make it easy to bets intended for money laundering within the sea of transactions flowing in and out.
It doesn’t matter who you are, whether you’ve been convicted of financial crimes or where your money comes from. The majority of casinos around the world are happy to accept wagers from anyone with hard cash to gamble.
High-rollers are a major source of profit for many casinos – in order to maintain a strong a favorable relationship with the client, staff may ignore or turn a blind eye to any suspicious transaction.

As you can imagine from the above statements, revenue and profit are huge motivating factors for the casinos. It is difficult to deny that casinos are powerless to stop this activity, and certainly more needs to be done from industry regulators to enforce systematic checks on customers that set-off red flags with suspicious depositing activity.

Industry regulators certainly have a part to play, by scrutinizing large casino companies around the world they regularly audit and analyze financial statements looking for irregularities. The biggest operators make enough money from legal transactions, and it tends to be smaller casinos in less stringent jurisdictions that are complicit with money launderers. In Asia, there has been a long-term problem with this illegal activity – and a thriving underground gambling industry.

Things are a little different online, especially if you are gambling in the UK or another strictly regulated market. If you are worried about what might be going on at your favorite casino site, have a look at our guide to casino safety to see what reputable sites are doing to keep everything above board.

Fighting Against Money Laundering with Regulation

Within tightly regulated industries such as Europe and North America casino money laundering is a very low threat to operations. The regulators in these territories are very diligent, using a mixture of law enforcement integrations, technology, and correct procedures to mitigate the problems. Communities in Europe and North America are more resistant to the risks associated with exposing themselves to organized crime and are more active in their resistance to money launderers.

However, the Asian gambling industry is worth over $180bn annually. Before the market became such an enormous part of the local economy, a strong and thriving underground gambling scene was firmly established. Even now that big corporate casino interests have a firm hold on the market, the dark underbelly still remains.

Certain casinos within Asia are notorious for being connected to the criminal underworld – on a much larger scale than any European equivalent. It has been proven in the past that the Yakuza has a strong grip over many gambling operators in Japan, and in South-East Asia there have been several high-profile match-fixing and money laundering busts in the past decade.

The tide is turning though. Many of these casinos have begun enforcing identity checks on their new customers. More importantly, the range of payment options that was previously available has been refined to a select few, in this scenario payments are much more easily traced. The ability to use different accounts for deposits and withdrawals has enabled casino money laundering in the past, ending this practice will do a great deal for squashing the remnants of money laundering in this industry.

Is the Game Up for Money Launderers?

Obstructing the use of casinos as a vehicle for money laundering is a constant battle between law enforcement, criminals and casino operators. In the UK, customer check procedures are continuously improving, and in its current state, the system is highly impenetrable. The same rings true for much of Europe and North America. However, the lackluster approach to financial scrutiny in certain jurisdictions continues to allow the practice of money laundering to sneak under the radar. The amount of money involved is truly staggering, with that comes powerful and illicitly motivated groups who are determined for their business to go uninterrupted. The battle rages on between criminals and the authorities who are often left chasing shadows.

You can find out more info about how casinos stay safe from crime and how internet gambling is regulated in this section of our guide to real money casino gambling.

Money Laundering is the process of “cleaning” the proceeds of criminal activity, such as drug trafficking or human smuggling appear to have come from legitimate sources. When left unchecked, “money laundering has potentially devastating economic, security, and social consequences. It provides the fuel for drug dealers, terrorists, illegal arms dealers, corrupt public officials, and others to operate and expand their criminal enterprises.”

Common stages in laundering

Money laundering schemes vary in their complexity and methods, but there are three common phases for successful laundering: Placement, Layering and Integration. Let us look at the individual stages.

1. Placement

The initial stage of money laundering – Placement – occurs when the launderer introduces their illegal profits into the financial system. This might be done by taking a large amounts of money and dividing it into less obvious sums.

This can allow criminals to deposit the money directly into bank accounts or purchase other legal financial instruments such as money orders and cheques – which are then moved elsewhere to be deposited at another location – moving the money away from the dirty source and closer to clean or legitimate accounts. It can also mean putting money in a number of places at the same time in an attempt to obfuscate investigators searching for laundering.

Placement is the term given to the process of moving dirty cash into the legitimate economy and further away from its illegal source

By placing the money in accounts or other financial instruments, the criminals hope the course of their criminal activity will be hidden from view by disguising it and distancing it from the crime.

Another popular way

Does Money Laundering Happen Often In Casinos