Federal money-laundering rules to be imposed in Nevada

LAS VEGAS -- Nevada casinos will have to meet new federal cash reporting rules, after the U.S. Treasury Department rejected a bid by Nevada gambling regulators to allow the state to continue with its present reporting system.

The change, which goes into effect Tuesday, requires casinos with gross gambling revenues of $1 million or more to file "suspicious activity reports" with the Treasury's anti-money laundering arm, the Financial Crimes Enforcement Network.

Nevada Gaming Commission Chairman Peter Bernhard said state regulators had hoped the federal government would let the state continue with its own rules, which apply to casinos grossing $10 million or more per year.

"Nevada was not able to negotiate an exemption, as we have for other reports under the Bank Secrecy Act," Bernhard said Friday. "This will add to internal reporting requirements for a greater number of licensees."

Officials said the new regulation will require reports from about 140 more Nevada gambling businesses that gross between $1 million and $10 million a year.

Some small casinos, bars and even supermarkets with large slot machine clienteles will be affected, Bernhard said.

Nevada has been operating since 1985 under a federal exemption letting the state collect currency transaction reports and forward them to the Treasury Department.

The state remained exempt from the reporting rule after the federal government in September 2002 adopted stricter regulations to counteract the threat of terrorist activity. The reports, aimed at stopping money laundering, require casinos to report transactions of $10,000 or more. They also prohibit some transactions of $3,000 or more.

Nevada lawmakers argued state money laundering regulations were at least as strict as the federal government's, and Nevada casinos complained that it would be time-consuming and expensive to file the paperwork required for the federal reports.

State regulators also argued that the lower threshold was unnecessary because smaller locations posed little money-laundering risk.

"You're not going to find some terrorist changing money at a supermarket slot machine," Bernhard said.

Unlike the federal rule applying to non-Nevada casinos, Nevada also prohibits cash-for-cash, cash-for-check and cash-for wire transactions of $3,000 or more.

Gaming Control Board records show that Nevada casinos have been fined more than $3 million by the state since 1985 for such transactions, which remain legal under federal rules.

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On the Net: Nevada Gaming Control Board: http://gaming.state.nv.us/