The Gaming Commission of Kentucky, an agency created to regulate the state’s gambling business, has filed a request for comment with the U.S. Department of Justice seeking to determine if Kentucky’s gaming industry has any legal standing to be subject to federal anti-money laundering rules.
Gambling industry lawyer, Stephen C. Tewksbury, said the commission’s request will be considered if the department’s response is forthcoming.
Tewksout said the gaming commission is seeking comment from the Justice Department, as well as representatives of the Kentucky Gaming Commission, the Kentucky State Police and the FBI, about the legality of the state gaming industry.
“It would be very helpful if they would respond to that as soon as possible,” Tewssbury said.
“We’re not here to regulate a casino.
We’re here to protect the citizens of Kentucky.”
The Justice Department has not yet responded to a request by the commission for comment.
A spokesman for the Kentucky Department of Corrections, Brian A. Johnson, declined to comment on the commission request.
Taken together, the federal government’s request for information and documents is seeking details about whether any gambling operations in Kentucky are legally subject to money laundering or other anti-bribery regulations, as required by federal law.
The request also seeks information about whether the state has any current or former employees with criminal history, or employees who have been convicted of any crime.
A person with knowledge of the matter said the DOJ is working with Kentucky Gaming to determine the extent to which Kentucky’s anti-corruption laws have been enforced.
The gaming commission, which is based in Lexington, has not had to register with the Justice the last time the state government faced a federal antimoney laundering or antibriarbery request, said Gary B. Miller, executive director of the Louisville-based National Gaming Association.
The Justice request was made to respond to a letter from Kentucky’s attorney general’s office, which had requested information about Kentucky’s state-licensed casinos.
Miller said the state-regulated casinos are not subject to anti-Money Laundering or anti-Bribery requirements because they operate in private sector venues.
Kentucky’s casinos are in the process of becoming a state-run entity under legislation that took effect Jan. 1.
The legislation provides for casino operators to become state-owned, but the process for that to happen is currently being held up in the courts.
Miller, who also chairs the state casino association, said it is not the first time the Justice has sought information about the state casinos.
He said the previous requests from the agency for information came in 2012 and 2013.
He said the Justice request for public records will not change that.
“They will still have to make that determination,” Miller said.
“I think it’s fair to say they’ve done a lot of work to determine that they are not in compliance with the law.”
Tewssworth said the gambling commission’s requests are not necessarily unprecedented.
“The DOJ’s always been very thorough with this request,” he said.
The U.N. International Centre for Missing and Exploited Children has been in contact with the Kentucky gaming commission to provide them with information on the state and local gambling industry, Tewsbury said, but it has not been asked for information by the gaming agency.
Tebksbury said the Kentucky law, which took effect in April 2016, requires gaming operations to submit to state and federal regulators a report detailing their compliance with anti- money laundering and anti- bribery laws.
Tees said he has not received any information from the Kentucky government that the state was breaking the law, but added that it is important to know the extent of the violations the gaming industry was committing.
“I’ve heard of people having their money seized by the state of Kentucky,” he told CBC News.
“So I would expect the same thing from a gaming operation.
If they’re in compliance, they should have no problem.”
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