San Bruno casino facing $8 million penalty over alleged money laundering on premises
The federal Financial Crimes Enforcement Network has hit Artichoke Joe’s Casino in San Bruno with an $8 million penalty for allegedly violating a number of anti-money-laundering laws over the past eight years.
From October 2009 until this month, FinCEN claims, the casino — one of the largest so-called card clubs in the state — failed to create adequate internal controls intended to detect, deter and report suspicious transactions.
The 101-year old casino’s operators have denied the allegations and say they’re currently their next steps.
In a statement released on Friday, FinCEN Acting Director Jamal El-Hindi said that “for years, Artichoke Joe’s turned a blind eye to loan sharking, suspicious transfers of high-value gaming chips and flagrant criminal activity that occurred in plain sight.”
“Casinos, card clubs and others in the gaming industry should consider their risk of exploitation by criminal elements, and understand that they will be held accountable if they disregard anti-money-laundering and illicit finance laws,” El-Hindi said.
The casino was raided by federal and state law enforcement officials and temporarily closed in March 2011. The raid led to the conviction of two of the casino’s customers on loan-sharking charges. According to FinCEN, senior-level employees at the casino knew that loan sharks were conducting criminal activity at the casino, using Artichoke Joe’s gaming chips to facilitate illegal transactions.
FinCEN claims the casino’s operators failed to file reports on the alleged illegal activity, like loan sharks passing chips to casino patrons on the gaming floor in clear sight of the casino’s employees.
Without the proper internal controls for rooting out and reporting suspicious financial activity, the casino was exposed to a heightened risk of money laundering and other criminal activity, FinCEN said.
The $8 million penalty “recognizes the duration and severity of AJC’s violations, the size and sophistication of the card club, AJC’s awareness of criminal activity on its premises, and its deficient culture of compliance,” FinCEN’s statement said.
In a statement sent by the casino’s publicist, Artichoke Joe’s president, Dennis Sammut said the casino “is fully committed to upholding all laws and complying with all regulations. A lot of effort has gone into and continues to go into compliance with the many laws and regulations applicable to cardrooms, and we will continue to dedicate all resources needed to achieve compliance with FinCEN and all other governing agencies.”