One of California’s oldest card clubs, Artichoke Joe’s, has been fined $8 million by the Treasury Department’s Financial Crimes Enforcement Network (FinCEN). According to FinCEN, Artichoke Joe’s “willfully violated” anti-money laundering (AML) laws from 2009 to 2017 by failing to “implement and maintain an effective AML program” and to “detect, deter, and timely report many suspicious transactions.” FinCEN further stated that 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.”
Card clubs are similar to casinos except that games are only played with cards, and customers gamble against each other rather than against the “house.” Because card clubs and casinos are classified as financial institutions (FI’s), both are expected to follow FinCEN’s AML regulations. According to FinCEN, a past raid of Artichoke Joe’s in March of 2011 resulted in two customers being indicted and convicted of loan sharking and other illicit activities conducted at the club. FinCEN also reported that high-level employees at Artichoke Joe’s were aware of the illicit activities taking place, but did not report any Suspicious Activity Reports (SARS).
Despite FinCEN’s statements, Artichoke Joe’s is disputing the claims, and is preparing to take the “next steps” as reported by Sam Rubenfeld, from the Wall Street Journal (WSJ). Dennis Sammut, President of Artichoke Joe’s, Dennis Sammut told WSJ, “A lot of effort has gone into and continues to go into compliance with the many laws and regulations applicable to card rooms, and we will continue to dedicate all resources needed to achieve compliance with FinCEN and all other governing agencies.”
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