#MoneyLaundering #Gambling #Casinos #SportsBetting
Have you ever wondered how gambling can be used to launder money? 💰 In this article, we will explore the ins and outs of money laundering through gambling, especially in reference to casinos. We’ll also touch on the possibility of using sports betting to launder money. So buckle up and let’s dive into the world of money laundering through gambling.
##Understanding Money Laundering
Before we delve into how gambling is used to launder money, let’s first understand what money laundering is. Money laundering is the illegal process of making large amounts of money generated by a criminal activity, such as drug trafficking or corruption, appear to have come from a legitimate source. It involves disguising the origins of illegally obtained money, typically by passing it through a complex sequence of banking transfers or commercial transactions.
###The Role of Gambling in Money Laundering
When it comes to money laundering, gambling can be an attractive option for criminals due to a few key reasons:
1. **Cash Intensive Nature**: Casinos and betting establishments deal predominantly in cash, making it easier for individuals to convert dirty money into clean chips or winnings.
2. **Complex Transactions**: The intricate nature of gambling transactions, coupled with the high volume of cash flow, can make it challenging for authorities to trace the origins of the money.
3. **Anonymous Nature**: Gambling facilities often require minimal personal information from patrons, allowing individuals to remain relatively anonymous while engaging in money laundering activities.
###Examples of Money Laundering in Casinos
Here are a few examples of how gambling, particularly in casinos, can be utilized for money laundering purposes:
– **Chip Walking**: Involves purchasing casino chips with illegal funds and cashing them out without engaging in actual gambling, effectively converting the dirty money into clean cash.
– **Bulk Chip Redemptions**: Criminals may orchestrate multiple smaller transactions to redeem chips for cash, flying under the radar of casino security and regulatory requirements.
– **High-Stakes Gambling**: Individuals may engage in high-stakes gambling with illegally obtained funds, then cash out and claim their winnings as legitimate income.
###Is Sports Betting a Viable Option for Money Laundering?
Now, let’s address the question of whether sports betting can be used for money laundering as well. The answer is yes, as sports betting shares some similarities with casino gambling that make it susceptible to money laundering tactics:
– **Cash Transactions**: Just like in casinos, sports betting often involves a significant amount of cash transactions, making it easier for criminals to blend their illegal funds with legitimate betting activities.
– **Complex Betting Patterns**: Criminals may place a series of strategically structured bets to disguise the origins of their illicit funds, effectively integrating their dirty money into the legitimate flow of sports betting.
– **Online Betting Platforms**: With the rise of online sports betting platforms, individuals can easily place bets from the comfort of their homes, adding an additional layer of anonymity to their money laundering activities.
In conclusion, gambling, including both casino gambling and sports betting, can indeed be utilized as a means to launder money. The cash-intensive, complex, and relatively anonymous nature of gambling activities make it an attractive option for individuals looking to disguise the origins of their illicit funds. However, it’s important for regulatory authorities and law enforcement agencies to remain vigilant and implement robust measures to detect and prevent money laundering activities within the gambling industry.
If you’re interested in learning more about the intricate world of money laundering and its ties to gambling, be sure to stay updated on our blog for future informative articles! 🎲📊💸
The idea is that it becomes harder to prove if those funds were in your possession when you entered the casino or if you won them playing there.
If law enforcement wanted to get involved, they may have to ask the casino to provide information about players card activity or any other records they may have about what was wagered/won there. If a player claimed to won a large amount on slots but didn’t have any single win over $1200, that alone could be mildly suspect.
Casinos are a very cash heavy business, so it’s fairly easy to launder money through a casino you own. Have your associates take the illegally-earned money and go to the casino you own, then have them lose all the money gambling. On your own books, it looks like entirely legal income.
Someone puts money they acquired illegally in a slot machine. They play a couple spins and cash out their “legally” acquired winnings.
In the film Hell or High Water they portray this by bank robbers entering the casino with several grand in stolen cash, the casino turning a blind eye to it and converting it to chips, then they play a few hands and spend several hours at the casino and cash out with their “winnings”.
Unless the casino is keeping very careful records, the government will have trouble proving how much money you entered the casino with. So if you have $1,000 in illegal gains, you gamble, and you end up losing $200, it’s win-win, because the casino made 200 bucks, and now you have $800 that are clean in the eyes of the law.
Anti-laundering laws are one of the reasons why many modern casinos now require gamblers to convert their cash into electronic cards. All the money that comes into the casino is now on an electronic ledger, which they can very easily turn over to the police, and then the police can come through the data for the names they’re interested in. As a fun side benefit, the casinos have found that gamblers are also willing to spend more when their money is on a card, because they can’t literally see it going out of their hands.
Walk into a casino with 10k in dirty money. Go to a blackjack table and exchange it for casino chips. Gamble small amounts like a normal for like 10 min. Then “randomly” get a phone call where you need to leave right away for a “family emergency” take your chips to the casino window where they give you cash and a receipt. Done.
Assuming I own a casino and also own some other “businesses” like drug sales.
Drug money is hard to spend because it is hard to walk into a bank and deposit it without the banks asking “where did you get 10,000 in small bills?”
So the casino.
Several “Clean” drug employees carry several thousand dollars apiece into the casino, convert it to chips and lose it all at the craps table. Suddenly that “Dirty” money is now clean.
To note, you are not taking all of the money out of the drug business, only the profits. So if the drug business costs 90,000 a month to operate (purchase of material, paying people off, payroll, etc) and brings in 100,000 dollars – you only take 10,000 to the casino and lose it gambling. The rest of the money stays in the drug business to keep it running.
Any all cash or mostly cash business that works with the public can be used to launder money. A few common examples are strip clubs, junkyards, convenience stores, etc. You just enter purchases that didn’t happen in your books and that explains where all the cash came from.
The amount of speculation and guessing here is crazy. Casinos follow the same cash handling policies as banks. The only way to get around money laundering would be to keep the transactions small and over a long period of time. You can’t claim large wins because casinos track that information and issue w-2’s for them, which get sent to the IRS as reported income. You also can’t cash out for very much without your info being recorded. Modern procedures specifically designed to combat laundering would make it very hard.
Source: I’ve been in casino operations for 20 years.
Regarding your question about sports betting, I know that where I live criminals buy and keep winning sports betting coupons, because when they are cashed you have a receipt that these money are legally obtained, so they only have to explain the amount betted. I don’t know who makes the bets or sells them. I don’t know if it’s a thing in the US, but it is in Denmark.
Guy i knew would ‘win’ 900k (not dollars) when he needed to wash a million. He had a deal with the casino so they took 10 percent, so 100k.
**”How is gambling used to launder money?”**
Its not, mostly
In theory, you walk in to a casino and buy $100,000 of chips with cash
You gamble a few hundred dollars and take $99k of chips to the cash desk and request a cheque for your “winnings”
The casino gives you a cheque AND informs law enforcement you are a criminal
Or
You walk in to a casino and buy 100k of chips, you gamble ALL of them and bank your winnings in a different cups, you are down 100k but up 80k, and get a tax bill on your “winnings”
Or you own the casino and have mules who gamble everything no matter what they win
​
I “did the maths” once and think I could clean 30% risk free, if you can find a drug dealer who wants me to turn £300k in to £100k send him over 🙂
Some criminals buy vouchers and cheques from Jack pot winners at premium
….I guess like a high speed loan.
There are other examples here
https://learn.baselgovernance.org/course/view.php?id=150
*edit. Seems like most people do not know the actual purpose of laundering money. **Laundering money, just to be clear, is to give it a paper trail where you can pay taxes on it and use it as you normally would without suspicion.** **You want the casino to generate tax forms. You want to pay taxes on the money.**
Say you are a computer programmer making $100,000 a year. If you had like $50,000 of questionable money that you wanted to introduce into your taxable income, then yeah you could use a casino to do that over the course of a couple of days. Each day, you buy in for a portion of that $50,000 (say $9k a day) and then play games for a bit. Then finally, when you have bought in for the total of $50,000, you play for a bit… and then you cash out. The casino will generate a report to the IRS of your winnings. **Once you pay taxes, you have now cleaned the money.** If the IRS asks where the money came from… you have a $100,000 a year job where you can say that you saved the money and went to Vegas to gamble away.
Same with sports betting.
The key thing about money laundering is you need another “clean,” legitimate income stream as co-mingling is how you get away with it.
For wealthy Chinese there is (was?) a market for people paying for all inclusive vacations at gambling destinations. This would include however much gambling money they wanted deposited at the casino.
They would go and do little to no gambling then cash out in a different currency (USD).
Not totally money laundering but kind of as it was a way to get your money out of China.
Lol. Gamblers don’t use casinos to launder money.
Casinos use gamblers to launder money.
The trick is to own a business that uses cash transactions (but without receipts) and provides a product or service that doesn’t require inventory (like a casino, video arcade, cheap movie theater, or massage parlor). That way, there is no way to track the actual business volume, making the accounting bookwork impossible to verify. This allows the owner to mix the revenue numbers from the illegal business into the “legal” one.
As long as they pay their taxes and don’t get greedy with inflating the legit business’s numbers to an unreasonable level, then they should be fine.
This is how they did it Vancouver. We even have a name for it: the Vancouver model
https://globalnews.ca/video/4150897/what-is-the-vancouver-model
In the 2010 case, Starlight high roller Yu Xiang Zhang walked into the casino and immediately converted $1.2 million worth of casino chips into cash, before asking the managers to provide him a letter saying the money was a legitimate payout.
[https://globalnews.ca/news/8277350/bc-casinos-money-laundering-cullen-commission-closing-arguments/](https://globalnews.ca/news/8277350/bc-casinos-money-laundering-cullen-commission-closing-arguments/)
During his testimony, Schneider described casinos as central to the Vancouver model of money laundering, outlining how, in many cases, illicit cash is turned into casino chips and then exchanged for a cheque.
https://www.cbc.ca/news/canada/british-columbia/cullen-commission-money-laundering-bc-tuesday-1.5585890
In Australia, poker machines (pokies) are used to launder money, it’s very much an open secret. You put your cash into the machine to gamble, pull the lever a few times so you have gambled, then withdraw your clean money out of the withdrawal machine as you leave.
Watch ozark season 3. Casino secretly finances a bunch of people to “gamble”/lose small amounts less than 10k each of undocumented (dirty) cash. When the money comes back through, it has a paper trail, and is officially on the books.
You just received 1 million in 20s, 50s, and 100s. Where can you go now?
You use that money to gamble.
Guy tries putting $500,000 into a penny slot just to play 1 spin and grab a “clean” casino voucher for $499,999.90 – ends up hitting a jackpot for 2 million – catalyst for the rest of story ensues
(not biblically accurate on money laundering but I worked with casino gaming commissions for 2 years and this was the “for dummies” version of how it’s possible + writing idea)
Sounds like a fun prompt you have though! Good luck 🙂
Just watch Ozark on Netflix, an awesome series that revolves around Mexican drug cartel laundering their drug money via casino they own in US. Ops shown pretty realistically and how federals try to catch them
Boy Boy did a video on how it can be done by anyone attending a casino in AUS, they took ~$50,000AUD in cash to a casino, deposited it all into one of the machines, then played a few games and left withdrawing all of their money out in “clean” (different) bills.
Funny side note: they did it wearing old timey prisoner outfits, shirts saying “I’m laundering money” and something about being an arms dealer while carrying briefcases of mannequin arms.
Basically what it would come out to is then making up a lot of people that came in and lost a couple hundred bucks. They say they paid in cash. It’s hard to prove those weren’t real people, especially when thousands of real people were making those same transactions
For a sports book yah it’s basically the same. They could just make fake accounts or add bets to real accounts. Would probably be easiest to just make fake accounts that just lose money. Honestly they could just make these fake accounts then have them throw on a bunch of random bets every week and eventually they would lose it and it would be damn near impossible to catch
Depends on your countries laws as to how easy it is, I can’t speak for other countries but in Australia it’s stupidly easy.
In Australia, being the top country for gambling in the world, casinos are only found in the major cities but in most towns you’ll find ‘pokies’ or slot machines in just about every pub/club like establishment and most of these businesses make 70% of their revenue from the commission off these machines.
The problem is, there’s no tax on winnings. It’s easy enough to walk into an establishment, feed the I’ll gotten gains into the machine, slap the button a few times while you sit back and enjoy a pint while you drop 3-5% loss and withdraw the new total and BAM non taxable legitimate funds that can be transferred straight into your account
Dude on YouTube literally walked into the local social club wearing “we’re laundering money” printed on their shirts with an ex member of the gambling industry (he blew the whistle and they passed all over him with backing from the government as he slowly dies from terminal cancer) and laundered money right there to show how easy it is and no one batted an eye
See video attached for the details
Are casino employees allowed to gamble at the casino that employs them? If they are, can they come in and anonymously bet their ill gotten money a little at a time every day, then have a no work no show job at the casino and still get a paycheck?
You can also launder money by losing dirty money to the casino and then winning clean money back. That will cost you about 51 cents for every 49 cents of clean money (blackjack). Depending on the game, craps and roulette can be closer to 50/50.