Regulator calls Mirage case a wake-up call

Kevin Rademacher

Friday, May 23, 2003 | 11:48 a.m.

Nevada casinos have been quietly filing currency transaction reports since 1985.

It wasn't until a recent audit found that The Mirage resort failed to submit thousands of the reports and a former executive was arrested for the violation that the issue earned much attention, said Gregory Gale, chief of the Nevada Gaming Control Board's audit division.

He said years of filing the reports without incident could have caused lapses in policies and standards, and the recent violations could serve as a needed wake-up call. His comments came Thursday at a Las Vegas gathering for the Financial Executives Gaming Forum.

"Sometimes people get procedures in place and they become routine," Gale said. "This might become a situation where the process is allowed to operate without much supervision."

He said the incident at The Mirage, which led to the Wednesday arrest of Christopher Morishita, turned up thousands of currency transaction reports that had been completed but never mailed to the federal Financial Crimes Enforcement Network. It marks the first time anyone has been charged with such a crime.

"It was all being done (at The Mirage), except the very simple step of putting it in the envelope," Gale said.

Casinos are required to file the reports for any transaction exceeding $10,000 in an effort to prevent money laundering.

Gale told the executives gathered Thursday that the incident is unlikely to lead to new rules, but regulators outlined several suggestions to increase oversight.

The recommendations included mailing logs, having multiple employees verify the sealing of envelopes after a supervisor counts the enclosed forms, the use of a mailing service that allows delivery confirmation, and maintaining a file of copies of the forms, Gale said.

"I suggest you actually go see that the work is being done," Gale told the executives. "You should have standard practices in place. These are not things that we are looking at adopting, but these are recommended practices."