FinCEN’s action is concurrent with actions from the US Attorneys’ offices in the District of Nevada and the Eastern District of NY. Cantor Gaming is an affiliate of Cantor Fitzgerald, the financial firm.
The news release provides some flavor as to the AML violations:
Cantor Gaming facilitated high risk and high dollar wagering on sporting events representing over 30% of all sports wagers in Nevada. At the same time, it failed to have an appropriate AML program in place. Cantor Gaming failed to have sufficient internal controls and mandatory independent audits; it failed to have sufficient AML training for its officers and employees; and it failed to use all available information to detect and report suspicious transactions. In addition to these extensive, years-long program violations, Cantor Gaming failed to properly and timely report currency transactions. Cantor Gaming also failed to file required suspicious activity reports (SARs) on several transactions, including transactions by customers who were involved in blatantly suspicious activity, those who were involved in criminal activity, and those who had no legitimate source of funds. And finally, Cantor Gaming committed thousands of recordkeeping violations, including by failing to keep required records on its highest-volume patron who placed more than $300 million in wagers between 2010 and 2013.
Part of FinCEN’s action also stemmed from a criminal investigation relating to Cantor Gaming’s involvement with the “Jersey Boys,” an illegal gambling operation that employed “runners,” or individuals who opened wagering accounts and placed bets with Cantor Gaming’s sports books. These runners were paid for illegally placing bets on behalf of others, including out-of-state bettors. Cantor Gaming’s Vice President, Michael Colbert, facilitated this illegal activity, and was indicted for his involvement with the Jersey Boys operation. Colbert was aware of the arrangement with the Jersey Boys runners, and facilitated its operation. Colbert was charged in the Eastern District of New York with a felony count of participating in an illegal gambling conspiracy and pled guilty on August 21, 2013.
FinCEN News Release
Statement of Facts