Billions & billions every month draw AML scrutiny


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Tiny Saipan casino catering to Chinese high-rollers draws AML Compliance scrutiny

Hong Kong-based casino operator Imperial Pacific International Holdings is finding itself in the investigatory crosshairs of the FBI. For its operations on the island of Saipan. If that doesn’t compute yet, it’s worth remembering that Saipan is the largest of the Northern Mariana Islands, a U.S. Commonwealth in the South Pacific.

According to a recent Bloomberg report on April 9, Imperial Pacific has loaded its board and various advisory positions with top former FBI and CIA personnel as well as other politically-connected Americans. That has not shielded the firm from scrutiny in Saipan where the company holds the exclusive right to operate casinos.

What recently made the news as an investigation into Chinese sub-contractors for “systematic human smuggling” of Chinese construction workers for a major expansion of a high-revenue casino operation appears to include the potential of a larger investigation into compliance with U.S. AML regulations.

In an in-depth report in November of 2016, Bloomberg described in detail the stunning casino revenues from Best Sunshine Live, a tiny storefront gambling operation tucked in a duty-free mall in Saipan. But it’s a haven for high-rollers—particularly ultra-wealthy Chinese gamblers—who have made it the highest revenue-per-table casino in the world.

For example, in September of 2016 “Imperial Pacific reported a record $3.9 billion in bets at its casino—meaning the 100 or so high-rollers who it says come through its doors monthly each wagered an average of $39 million,” according to the Bloomberg report in November 2016.

And Bloomberg reported in its April 9 story that in March of 2017, “Best Sunshine Live’s VIP tables handled just under $3 billion in bets in March.” According to figures from Imperial Pacific, this was up from $1.67 billion a month earlier.

These staggering figures for a tiny and bland store-front casino on a relatively remote island have drawn the attention of the U.S. Treasury and its FinCEN division. Bloomberg in its November 2016 report summed up that interest in the context of the larger scene: “The story of how Saipan’s casino came to enjoy such puzzling success is a tale of money and political intrigue that stretches across the Pacific, connecting it to top power-brokers in Washington and New York, 14 time zones away. But above all, it links the island with the burgeoning ranks of China’s super-rich and the fathomless wealth, obtained legitimately or otherwise, that they’re seeking to move around the world.”

Executives at Imperial Pacific and its casino properties assert that recent FBI scrutiny applies only to construction sub-contractors and their hiring processes. Executives assert further that the company’s casino operations are entirely transparent and compliant regarding U.S. AML laws and regulations.

Questions and intrigue, however, are inescapable here. Not only because of the stunning sums of money passing through Saipan’s Best Sunshine Live and the attendant interest from the U.S. Treasury Department but also because of the U.S. political heavy hitters that populate the board of Imperial Pacific.

Bloomberg in its most recent report on April 9, 2017, noted the following: “Its chairman is Mark Brown, a former executive with Donald Trump’s Atlantic City casinos. Former CIA director James Woolsey and Eugene Sullivan, formerly a senior military judge, sit on its board. Former Louisiana Governor Haley Barbour, former FBI director Louis Freeh and former Pennsylvania Governor Ed Rendell serve as advisers, the company said in a March 28 presentation.”

Whether the burgeoning questions about casino operations on Saipan continue to gain traction will be an AML Compliance story to follow in the coming months. What is already clear is that there are a lot of questions, a lot of heavy hitters from Washington DC and a lot of mind-bogglingly wealthy Chinese gamblers involved in the same scene—a small and non-descript gambling scene through which billions of dollars flow every month.

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