A permanent fixture in San Bruno, Artichoke Joe’s Casino was recently dealt an $8 million civil money penalty by the federal Financial Crimes Enforcement Network (FinCEN) for allegedly violating various anti-money laundering laws since October 2009.
According to the news release, for the past eight years until this month, the FinCEN alleges that Artichoke Joe’s Casino, a family founded and family-owned business since 1916 and one of California’s largest card clubs, failed to implement and maintain internal controls sufficient to detect, deter and report suspicious transactions.
According to newspaper website SFGate, the allegations have been refuted by the operators of the 101-year-old casino and they are currently contemplating their next steps.
Jamal El-Hindi, Acting Director of FinCEN, commented in a statement released on Friday, saying that “For years, Artichoke Joe’s turned a blind eye to loan sharking, suspicious transfers of high-value gaming chips, and flagrant criminal activity that occurred in plain sight. FinCEN’s $8 million civil penalty results from the card club’s failure to establish adequate internal controls and its willful violations of the Bank Secrecy Act.” El-Hindi went on to say, “Casinos, card clubs and others in the gaming industry should consider their risk of exploitation by criminal elements, and understand that they will be held accountable if they disregard anti-money laundering and illicit finance laws. This significant action highlights the need for all entities, including those in the gaming industry, to build a robust culture of compliance into their policies and procedures to ensure they are not facilitating illicit activities.”
In March 2011, Federal and state law enforcement officials reportedly raided the cardroom and it was temporarily closed. As a result of the raid, two of the cardroom’s customers were convicted on loansharking charges. FinCEN claims that senior-level employees at Artichoke Joe’s Casino were aware that criminal activity was being conducted by loan sharks at the casino and using the venue’s gaming chips to facilitate illegal transactions, according to SFGate.
The bureau claims that the operators of Artichoke Joe’s Casino failed to file any Suspicious Activity Reports (SARs) on the alleged illegal activity, such as casino patrons being passed chips on the gaming floor by loan sharks within clear sight of employees of the cardroom.
According to the statement by FinCEN, the $8 million penalty “recognizes the duration and severity of AJC’s violations, the size and sophistication of the card club, AJC’s awareness of criminal activity on its premises, and its deficient culture of compliance,” as reported by SFGate.