Key Moments:
- Wynn Las Vegas agreed to a $130 million settlement with federal authorities over illegal cash transfers.
- Nevada regulators fined Wynn Las Vegas an additional $5.5 million for related compliance failures.
- Investigations revealed a sophisticated underground banking network supporting high-stakes Chinese gamblers in Las Vegas.
Federal Crackdown on Underground Casino Banking
Las Vegas casinos became the center of a large illicit financial operation. The scheme allowed high-end Chinese gamblers to bypass strict currency controls. According to CNN, underground bankers and criminal groups helped move millions of dollars in unreported funds. These transfers occurred across Las Vegas gaming floors. The operations relied on intermediaries who provided cash to guests. Investigators also alleged links to drug trafficking, human smuggling, and prostitution.
Lei Zhang, one of four Chinese nationals based in Las Vegas, was identified as a central figure in this system. The network exploited loopholes in financial reporting rules. It also bypassed both U.S. and foreign regulations, including the Bank Secrecy Act. Carissa Messick, special agent in charge of the IRS-CI unit in Las Vegas, commented, “Federal laws that regulate the reporting of financial transactions are in place to detect and stop illegal activities. Deliberately avoiding Bank Secrecy Act requirements is a form of money laundering.”
Wynn’s Record Settlement and Regulatory Response
After federal investigators determined Wynn Las Vegas had a role in facilitating illegal monetary movements, the casino agreed to a $130 million non-prosecution settlement. In addition, Nevada regulators imposed a $5.5 million penalty for issues linked to this activity.
Wynn Resorts assured CNN that it fully cooperated with authorities and terminated employees who were implicated. The statement from the company read, “immediately terminated the few employees involved because their actions violated the Company’s compliance program”. Wynn further stated, “Wynn is committed to upholding the highest standards of integrity, compliance, and regulatory responsibility. We accept responsibility for the historical deficiencies identified, have taken meaningful remediation, and are dedicated to ensuring that such failures do not reoccur.”
The settlements stemmed from cases involving Zhang and three associates, who supplied illicit cash to high-rolling customers aiming to bypass Chinese currency export restrictions. Chris Urben, a former DEA official, remarked about the confiscated money, “48 hours ago, that was the proceeds of fentanyl.”
| Company | Settlement Amount | Regulatory Fine |
|---|---|---|
| Wynn Las Vegas | $130,000,000 | $5,500,000 |
Underground Banking Methods Revealed
CNN detailed how illicit financiers collected and supplied cash to those looking to avoid the formal banking system, including clients with connections to Mexican cartels and prostitution rings. The money was typically delivered in private locations, such as hotel rooms or vehicles, and repayment was made through Chinese bank transfers or via WeChat. Gamblers then converted the cash into casino chips, providing a clean appearance for illicit funds.
This approach benefited all parties: casinos attracted high rollers, gamblers received spending money, criminal suppliers laundered their proceeds, and underground bankers earned commissions. Investigations into phone records showed extensive contact between key individuals and Wynn casino hosts, with agents citing “hundreds a week”.
Surveillance and Prosecution
The probe began when staff at another prominent Las Vegas casino reported suspicious activity involving frequent meetings between a man carrying a satchel and casino hosts. IRS agents identified Lei Zhang, Bing Han, Liang Zhou, and Fan Wang as orchestrators. In May 2019, an undercover operation led to the seizure of large sums of cash and the linking of associates to escort services. This eventually resulted in the arrest of all four key figures by that summer.
By the end of 2020, each defendant pleaded guilty to running an unlicensed money transmitting business. Prosecutor Mark Pletcher commented, “We are talking about a problem in the hundred-million dollar range” each year. Former detective Peter Fuller observed, “You just can’t go take cash from anybody, because what ends up happening is, you end up taking it from Pablo Escobar.”
A Pattern of Global Expansion
Underground banking through casinos has become a widespread phenomenon, with similar cases identified in Australia and Canada. Vanda Felbab-Brown of the Brookings Institution stated, “Over the past eight years or so, you have this big explosion of Chinese money laundering in the states, in Mexico, in Europe.”
Gaming compliance professionals have noted a shift in regulatory scrutiny, as authorities now extend investigatory pressure to casinos in light of the Wynn case. DEA official Brian Clark directly associated the money laundering practice to broader societal harm, explaining, “It’s all being fueled from this money laundering trade, and it results in the death of Americans.”
- Author
Daniel Williams
