Casino Money Laundering – Interesting Facts And Well-Known Practices

August 27, 2019 Ken Johnson

Have you ever wandered what money laundering is, how it works and why it often takes place in gambling venues? Then this article is right up your alley. We are going to take a detailed look into casino money laundering and what makes is such a formidable tool in the criminals’ arsenal. Thus, after reading this short piece you will have a much better understanding of the topic.

Money Laundering At Casinos

How Does Money Laundering Work?

Now, before we jump into the question of how money laundering works, its not a bad idea to take a look at what it actually is. Basically, any money that has been obtained through illegal activities and is not taxed is a massive red flag to any legit banking institution. Thus, people who have acquired large sums of cash and don’t fancy a trip to prison, would do everything in their power in order to make the money look like it came from lawful businesses. It is widely believed that the term originates in the times of the great depression, when Al Capone used to hide his riches in the laundromats that he owned. Nowadays, money laundering refers to any action that aims to disguise illegal profits as a legitimate income.

Having cleared that out, it is now time to take a closer look into the paths that criminals take when trying to launder their funds. We would be mad if we were to try and explain every known approach ever used. What we are going to do instead is examine the three main steps that have remained the same, despite the ever-increasing complexity of money laundering.

The Placement The first step of the process is also the most critical. It revolves around moving large sums of money from their source into the bank accounts of one or more businesses. Because such transactions would often get the attention of the banking institutions, this is where most perpetrators get caught. In order to get around this issue, criminals tend to use multiple tricks such as asset purchase, currency exchange, securities brokers, funds merging, bank complicity or currency smuggling.
Layering The second step is the most straightforward one. The goal here is to make the funds as hard to trace as possible, thus making it impossible for law enforcement agencies to do their jobs. Once again there are a couple of tricks that criminals seem to favour. The first and easily the easier to execute is the process of buying expensive material assets, which can later be sold. These may be supercars, yachts, luxury apartments, mansions, private planes, the list goes on and on. The second method is based on the idea that once the money is dispersed into a large number of bank accounts and converted into monetary instruments, it becomes impossible to track.
Integration Once the money is laundered it needs to be entered back into circulation, so that it can be used again. As you can imagine, the funds, earned from selling the material assets that were acquired during the stage of Layering, will simply appear in the system as lawful and legit earnings. By this stage of the laundering process, if properly executed, it is almost impossible for the authorities to catch the perpetrators without the use of informants with an inside knowledge of the organisations.

By now you should be beginning to understand why casinos are such a good target for money launderers. The incredibly large amount of money that goes through the registers on a daily basis together with the fact that most of it is in cash, make money laundering through casinos both quick and easy.

Money Laundering In Online Casinos

The topic of money laundering in conventional brick-and-mortar casinos has been discussed countless amounts of time and has been featured in numerous movies and TV shows. Moreover, we are living in the 21st century and online casinos are the new thing, so we thought that it would be a great idea to answer the questions of how criminals could use online casino money laundering. As you know, the online gaming industry’s most notorious characteristic are the huge sums of money that are constantly changing hands. This means that there is huge potential for it being used as a platform for transforming illegal profits into untraceable earnings.

Money Laundering Takes Place At Online Casinos

The most widely spread methods is also the easiest and quickest to execute. All that the perps do is to place a large deposit into an online casino and place enough bets that their account has the minimum required activity, so it doesn’t raise any red flags. Moreover, they can evade detection by separating the funds into multiple accounts and transactions. Statistics show that by using this technique, experienced money launderers can clean hundreds of thousands of pounds in less than a single week.

The Battle Against Money Laundering

Despite the fact that law enforcement agencies around the world are working around the clock in the fight against money laundering, it is still one of the largest issues in the sphere. According to the International Monetary Fund, more than $1.5 trillion is being laundered every single year, which amounts to as much as 5% of the World’s gross domestic product. Nevertheless, thanks to multiple legislations and security measures that have been implemented in recent years, the number of successful money laundering operations is constantly decreasing. Moreover, the risk that they create for the average players at online casinos has been completely extinguished.