MGM Grand and The Cosmopolitan settle for $7.45m in AML probe

January 26, 2024
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The former president of MGM Grand Casino, Scott Sibella, has pleaded guilty to a federal charge related to the Bank Secrecy Act, admitting failure to report suspicious transactions. 

The Justice Department revealed that Sibella allowed a casino patron, Wayne Nix, who operated an illegal bookmaking business, to gamble with illicit proceeds without notifying the casino's compliance department. 

Sibella, during his tenure from August 2017 to February 2019, also authorized Nix to receive complimentary benefits, including meals, rooms, board and golf trips, to encourage patronage.

MGM Grand and The Cosmopolitan of Las Vegas – both of whom were implicated in the money laundering and BSA violations probe – have agreed to settlements amounting to a combined $7.45m. 

The casinos will also undergo external reviews and enhance their anti-money laundering compliance programs. Furthermore, the settlements will involve a commitment to spending at least $750,000 over two years on an external compliance reviewer.

The BSA mandates that casinos file reports on suspicious activities, ensuring the prevention of money laundering. In this instance, Sibella, despite being trained and aware of his duties, failed to report Nix's illegal sports bookmaking activities which ultimately led to MGM Grand's failure to file necessary suspicious activity reports.

Sibella faces a maximum penalty of five years in prison and a $250,000 fine, with his sentencing scheduled for 8 May. Nix, who pleaded guilty in April 2022 to operating an illegal gambling business and subscribing to a false tax return, is set to be sentenced on 6 March.

Both MGM Grand and The Cosmopolitan – under Non-Prosecution Agreements – acknowledged laundering Nix's illicit funds and failing to file proper suspicious activity reports. MGM Grand further admitted deficiencies in its AML compliance program, leading to a failure to prevent Nix's money laundering.

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