The director of the Financial Crimes Enforcement Network (FinCEN) Kenneth A. Blanco, has urged casinos to follow the agency’s guidelines in regards to suspicious convertible virtual currency (CVC) activity.
Blanco during his speech at the 12th Annual Las Vegas Anti-Money Laundering Conference on Aug. 13, Blanco addressed casinos’ compliance with the FinCEN’s guidance released in May. In their guidance, the FinCEN considered certain business models involving CVC financial institutions to help them comply with their existing obligations under the Bank Secrecy Act (BSA). The guidance, however, did not establish any new regulatory expectations or requirements.
Specifically Blancomentioned two areas where CVC intersects with casinos and card clubs, which are online CVC casinos as well as physical casinos and card clubs that accept CVC for gaming. Blanco noted that casinos dealing with cryptocurrencies should consider how they will conduct due diligence on CVC transactions and blockchain analytics and how they will incorporate CVC-related indicators into their SAR filings.
Blanco stressed that a gap in reporting by casinos remains an area of concern, explaining:
“I encourage casinos to closely review both documents on FinCEN’s website to see how we are addressing this industry and its interactions with others in the financial sector. Casinos should be filing SARs when they encounter suspicious CVC activity and any cyber events that affect, facilitate, or conduct transactions. We know that casinos are targets for cyber and cyber-enabled criminal activity such as ransomware attacks and business e-mail compromise schemes.”