Especially in reference to casinos?
Edit: since I’ve gotten some answers, I want to add: is it possible to use sports betting to launder as well?
In: Economics
The idea is that it becomes harder to prove if those funds were in your possession when you entered the casino or if you won them playing there.
If law enforcement wanted to get involved, they may have to ask the casino to provide information about players card activity or any other records they may have about what was wagered/won there. If a player claimed to won a large amount on slots but didn’t have any single win over $1200, that alone could be mildly suspect.
Casinos are a very cash heavy business, so it’s fairly easy to launder money through a casino you own. Have your associates take the illegally-earned money and go to the casino you own, then have them lose all the money gambling. On your own books, it looks like entirely legal income.
In the film Hell or High Water they portray this by bank robbers entering the casino with several grand in stolen cash, the casino turning a blind eye to it and converting it to chips, then they play a few hands and spend several hours at the casino and cash out with their “winnings”.
Someone puts money they acquired illegally in a slot machine. They play a couple spins and cash out their “legally” acquired winnings.
Unless the casino is keeping very careful records, the government will have trouble proving how much money you entered the casino with. So if you have $1,000 in illegal gains, you gamble, and you end up losing $200, it’s win-win, because the casino made 200 bucks, and now you have $800 that are clean in the eyes of the law.
Anti-laundering laws are one of the reasons why many modern casinos now require gamblers to convert their cash into electronic cards. All the money that comes into the casino is now on an electronic ledger, which they can very easily turn over to the police, and then the police can come through the data for the names they’re interested in. As a fun side benefit, the casinos have found that gamblers are also willing to spend more when their money is on a card, because they can’t literally see it going out of their hands.
Walk into a casino with 10k in dirty money. Go to a blackjack table and exchange it for casino chips. Gamble small amounts like a normal for like 10 min. Then “randomly” get a phone call where you need to leave right away for a “family emergency” take your chips to the casino window where they give you cash and a receipt. Done.
Assuming I own a casino and also own some other “businesses” like drug sales.
Drug money is hard to spend because it is hard to walk into a bank and deposit it without the banks asking “where did you get 10,000 in small bills?”
So the casino.
Several “Clean” drug employees carry several thousand dollars apiece into the casino, convert it to chips and lose it all at the craps table. Suddenly that “Dirty” money is now clean.
To note, you are not taking all of the money out of the drug business, only the profits. So if the drug business costs 90,000 a month to operate (purchase of material, paying people off, payroll, etc) and brings in 100,000 dollars – you only take 10,000 to the casino and lose it gambling. The rest of the money stays in the drug business to keep it running.
Any all cash or mostly cash business that works with the public can be used to launder money. A few common examples are strip clubs, junkyards, convenience stores, etc. You just enter purchases that didn’t happen in your books and that explains where all the cash came from.
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The amount of speculation and guessing here is crazy. Casinos follow the same cash handling policies as banks. The only way to get around money laundering would be to keep the transactions small and over a long period of time. You can’t claim large wins because casinos track that information and issue w-2’s for them, which get sent to the IRS as reported income. You also can’t cash out for very much without your info being recorded. Modern procedures specifically designed to combat laundering would make it very hard.
Source: I’ve been in casino operations for 20 years.
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