Normandie Casino Owners Ordered to Pay $2.4 Million for Violating Bank Secrecy Act

Posted on: September 5, 2016, 02:00h. 

Last updated on: October 12, 2016, 08:37h.

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Expertise: Commercial Gaming.
Normandie Casino $2.4 million fine Bank Secrecy Act
Though she’s now a real estate agent in California’s Orange County, former Normandie Casino President Michelle Miller Wahler’s family partnership is on the hook for $2.4 million for failing to adhere to the Bank Secrecy Act. (Image: PRWeb/Normandie Casino)

The Normandie Casino in Gardena, California is no more, but its former owners are still on the hook for a $2.4 million penalty.

In January, the owners of California’s oldest card club pled guilty to violating the Bank Secrecy Act and admitted to hiring independent gaming promoters to attract high-rollers. The casino also confessed to deliberately failing to file the proper transaction reports.

Owned by the Miller family since 1947, the Normandie casino owners found out their sentencing fate last week.

United States District Judge James Otero ordered the Millers to pay $500,000 for each of the two counts of failing to report large cash transactions and maintain an effective anti-money laundering program. Otero also ordered the Normandie casino to forfeit $1,383,530, which represents numerous unreported transactions in 2013.

The Bank Secrecy Act requires casinos to report details of individual transactions over $10,000.

“Our money laundering laws were enacted to prevent criminals from concealing the source of large sums of cash generated by illegal activity,” United States Attorney Eileen Decker said in a statement.

“Casinos and cardrooms such as Normandie are cash-intensive businesses that are particularly attractive for use by criminals seeking to launder their ill-gotten gains, so they must be vigilant in meeting their obligations under those laws,” Decker explained.

New Owner, New Problems

Larry Flynt bought the shuttered Normandie Casino in July. The acquisition gave the magazine publisher a monopoly on Gardena gambling, as his Hustler Casino is now the only other card club in town.

Flynt renamed the venue the Lucky Lady Casino.

But the former publisher of illicit magazines is in a turf war with local officials over taxes and signage. Gardena initially extended tax breaks to Flynt to entice him to buy the Normandie, but at the last-minute, the city council added a provision that demanded the property pay $800,000 a month to Gardena before any tax breaks would initiate.

The council also vetoed the proposed signage of the Lucky Lady. The logo featured a woman in a low-cut swimsuit with her legs draped across the “Y” in the word “Lucky.”

The 73-year-old Flynt said recently that he’s being treated like a second-class citizen. Of the monthly $800,000 payment, he said, “I’ve never, ever heard of a deal like that. Only a fool could sign, and I’m no fool.”

Regardless, the Lucky Lady is open for business on Rosecrans Avenue.

Invasion of Normandie

One year shy of its 70th birthday, the Normandie Casino enjoyed a storied run for decades. Its conclusion, however, is doused in controversy.

Gaming pioneer Russ Miller made a fortune off of being the first in the game in California’s legalized gambling market. Taxes from the casino have largely financed Gardena’s government over the years, and the two had a harmonious relationship.

But the IRS and the California Department of Justice’s Bureau of Gambling Control crackdown on money laundering essentially closed down the Normandie. The Millers had their gaming permits revoked and were forced to sell the family business.

IRS investigative agent Anthony Orlando has no remorse.

“This sentence demonstrates the government’s ability to enforce the anti-money laundering laws used to ensure that certain high-rollers do not remain below the radar,” Orlando stated.