Key Moments:
- Caesars Entertainment agreed to pay a $7.8 million fine and implement extensive AML compliance reforms
- Nevada regulators cited failures in Caesars’ ability to track source of funds and address suspicious activity swiftly
- An independent AML expert will assess Caesars’ progress and report to regulators in two years
Regulators Demand Stronger AML Compliance
Caesars Entertainment has come under significant regulatory pressure, especially since the Nevada Gaming Control Board (NGCB) found flaws in the company’s anti-money laundering (AML) procedures. According to the NGCB, Caesars’ program did not adequately determine the origins of funds from customers, and it also failed to respond promptly to reports of illegal activity. While the specific factors triggering the investigation were not detailed, the board expressed that the company’s current efforts fell short of expectations.
As part of a resulting agreement, Caesars is required to pay a $7.8 million settlement and institute broad compliance enhancements.
Mandated Overhaul and Ongoing Oversight
The terms of the settlement introduce an expanded set of responsibilities for Caesars. The company is now compelled to provide real-time risk management solutions, update its AML program, and directly deliver any modifications to the NGCB chair. Top compliance or legal officers must be available to meet with regulators as often as four times per year if requested.
Caesars is also obligated to improve its communication practices with financial institutions, and within 60 days, must deliver in-person AML training to independent agents, casino hosts, marketing teams, and all staff with credit authority exceeding $50,000. Additionally, the board of directors, as well as senior management and executives at all subsidiary casinos, are required to receive annual AML training.
Focus on Culture and Accountability
The regulatory authorities are seeking more than just updated policies – they expect genuine internal awareness among frontline employees. Caesars must increase internal communication around AML, especially targeting cage cashiers, table staff, and marketing personnel, promoting upfront reporting and minimizing reluctance to flag suspicious behavior.
The policy changes dictate that marketing staff can only join AML committee meetings upon the invitation of the chief legal officer. AML staffing levels must be maintained, and any vacancies need to be filled promptly. A third-party AML specialist will perform a comprehensive review in two years and will communicate findings directly to the regulators.
Track Record and Industry Implications
This penalty is not the first Caesars has faced for compliance failures. In 2015, FinCEN imposed an $8 million fine on Caesars Palace, with an additional $1.5 million levied by the NGCB, arising from oversight deficiencies in exclusive gaming salons used by VIPs. After Caesars merged with Eldorado Resorts in 2020, bringing in new management and altering its corporate structure, regulators recognized these changes as mitigating elements in this current case.
However, the NGCB underscored the ongoing need for accountability. Caesars accepted the settlement conditions without admitting or denying wrongdoing and committed to remitting the fine within two business days following regulatory approval.
Broader Context for Nevada’s Gambling Market
The developments highlight Nevada’s determination to safeguard the integrity and transparency of its gambling industry. Caesars is now required to demonstrate robust compliance systems to restore regulatory confidence. The latest incident raises broader questions for the industry about potential future regulatory actions if further lapses occur.
| Year | Fine Entity | Penalty Amount | Issue |
|---|---|---|---|
| 2015 | FinCEN | $8,000,000 | Gaps in private salon oversight |
| 2015 | NGCB | $1,500,000 | Gaps in private salon oversight |
| Current | NGCB | $7,800,000 | AML compliance failures |
- Author
Daniel Williams
