The Treasury Department’s Financial Crimes Enforcement Network has issued guidance to confirm that, under the Bank Secrecy Act, a casino that has filed a Suspicious Activity Report may share it, or any information that would reveal the existence of the SAR, with each office located within the United States of either the casino itself or a parent or affiliate.
“Sharing SARs under these circumstances will assist casinos in discharging their responsibilities with respect to enterprise-wide risk management and compliance with applicable laws and regulations,” the advisory says. “Sharing SARs with domestic parents and affiliates will facilitate a casino’s ability to identify suspicious transactions. In addition, a parent or affiliate’s respective anti-money laundering efforts may be enhanced by reviewing the casino’s SARs and obtaining a clearer and more comprehensive understanding of the activities the casino has identified as suspicious.”
While BSA regulations generally prohibit SAR disclosures, they authorize SAR disclosures to specific enumerated parties. Specifically, provided no person involved in the transaction is notified that the transaction has been reported, casinos are expressly permitted to disclose SARs to: FinCEN; any federal, state, or local law enforcement agency; any Federal regulatory agency that examines the casino for compliance with the BSA; any state regulatory authority that examines the casino for compliance with state laws requiring compliance with the BSA; or any tribal regulatory authority that examines the casino for compliance with tribal laws requiring compliance with the BSA.
The regulations also provide that casinos may: disclose the underlying facts, transactions, and documents upon which a SAR is based, including, but not limited to, disclosures to another financial institution, or any director, officer, employee or agent of a financial institution, for the preparation of a joint SAR; and share a SAR, or any information that would reveal the existence of a SAR, within a casino’s corporate organizational structure for purposes consistent with Title II of the BSA.
The approval to share SARs, or information that would reveal the existence of a SAR, with domestic parents and affiliates is subject to certain limitations. Specifically, casinos may not share SARs or revealing information with:
Parents, affiliates, offices, or other places of business located outside the U.S., including non-U.S. offices of domestic parents or affiliates;
Individuals or entities within a parent or casino’s organizational structure who perform functions unrelated to gaming;7
A financial institution without an independent SAR-filing obligation, such as a check casher or a money services business that may be co-located with a casino but is not an affiliate of the casino.
In addition to the above limitations, a casino’s domestic affiliate receiving a SAR from the casino may not further share that SAR with an affiliate of its own, even if that affiliate is subject to a SAR rule. In other words, an affiliate that obtains a SAR (or information that reveals the existence of a SAR) cannot forward that SAR (or information) to another affiliate. There also may be circumstances under which a casino, its parent or affiliate, or both would be liable for direct or indirect disclosure of a SAR, or any information that would reveal the existence of one, to any person who is the subject of the report. In this regard, casinos should have policies, procedures, and internal controls in place to ensure that the confidentiality of SARs is protected.
Consistent with the BSA and the implementing regulations issued by FinCEN, the guidance does not, authorize the disclosure of a SAR, or any information that would reveal the existence of a SAR, where a casino has reason to believe this information may be disclosed to any person involved in the suspicious activity that is the subject of the SAR.