In the fast-paced world of entertainment and hospitality, Resorts World Sentosa (RWS) has recently found itself in hot water. The Gambling Regulatory Authority (GRA) has slapped RWS with a staggering S$2.25 million fine for a serious lapse in conducting customer due diligence checks. Let’s delve into the details of this unprecedented penalty and the events leading up to it.
The Regulatory Requirements
Understanding Customer Due Diligence
The Casino Control Act and the Casino Control (Prevention of Money Laundering and Terrorism Financing) Regulations mandate that casino operators perform due diligence checks for cash deposits exceeding S$5,000. This crucial step ensures the transparency and legality of financial transactions within the casino industry.
The Oversight: RWS’s Failure
Failure to Establish Identity
In a press release dated December 8, the GRA revealed that RWS failed to conduct essential due diligence checks on third-party depositors. The casino giant neglected to record necessary identifying information and overlooked the verification process using reliable and independent sources, as explicitly required by regulations.
The Magnitude of the Fine
Reported by CNA, the S$2.25 million penalty levied on RWS marks a historic moment, being the largest fine ever imposed by the GRA on a casino operator. This raises questions about the gravity of RWS’s oversight and the potential consequences for such lapses in the highly regulated casino industry.
Uncovering Non-Compliance
Review of Patron Activities
In 2020, the GRA instructed RWS and Marina Bay Sands (MBS) to review certain patrons’ activities. This review brought to light several non-compliant transactions conducted by RWS, prompting further investigation by the regulatory authority.
Systemic Failures and Control Issues
The investigations revealed that RWS had a framework and controls in place to adhere to guidelines. However, systemic failures in specific controls led to the failure to detect non-compliances during transactions spanning from December 2016 to December 2019.
Remedial Actions and Consequences
Prompt Actions by RWS
Acknowledging the lapses, RWS took swift action to improve its processes. The casino engaged an independent party to review its standard operating procedures and, notably, undertook a comprehensive review of its corporate culture to strengthen internal controls and corporate governance.
Employee Licence Cancellation
In addition to the substantial fine, GRA took a severe stance by canceling the special employee licence of an individual involved in the breaches. GRA issues these licenses to individuals who play crucial roles in casino-related functions or decision-making regarding casino operations.
Ongoing Investigations and Regulatory Vigilance
Assessing Culpability
GRA is not stopping at the hefty penalty and licence cancellation. Further investigations are underway to assess the culpability of other special employees involved in the oversight. This move underscores GRA’s commitment to maintaining a tight grip on operators’ compliance with regulatory requirements.
GRA’s Warning and Assurance
In a stern statement, GRA emphasized its serious view of such lapses and assured that it would not hesitate to take disciplinary action against errant casino operators. The regulatory body pledged to continue its vigilant supervision to ensure strict compliance with regulatory standards.
Conclusion
Resorts World Sentosa’s record-breaking fine serves as a stark reminder of the casino industry’s need for stringent adherence to regulations. The GRA’s actions send a clear message that non-compliance will be met with severe consequences. RWS’s commitment to rectifying its shortcomings is evident, but only time will tell if these measures prove effective in rebuilding trust in this entertainment powerhouse.