Casinos are widely favoured by drug interests as potential laundries

Any decision to introduce casino gambling in Guyana requires at a minimum a complete and thorough examination of its moral, economic and social implications. The leaders of the various religious communities in Guyana including Pandit Reepu Daman Persaud of the Guyana Hindu Dharmic Sabha, the Central Islamic Organisation of Guyana and Bishop Alleyne of the Catholic Church have unanimously expressed their opposition to casino gambling.

The concerns of these gentlemen cannot be dismissed as the encroachment of religion into matters political. The views expressed reflect the values and opinions of large segments of the population with whom the religious leaders interact as often as weekly and certainly more regularly than politicians. They have as much of a stake and interest in the type of society we shape and bequeath as any politician. The views therefore ought to be seriously considered in any national debate.

Even those who advocate gambling acknowledge its great social cost. Indeed in many countries there are facilities to address the question of gambling addiction and only recently the US found it necessary to ban internet gambling partly as a result of an expose on the effect on students as well as legal implications. So often careers have been destroyed, families broken and valuable economic potential wasted because so many seek the elusive dream of a fortune. One only has to look at the number of actual winners to those engaged in gambling to understand how loaded the dice is against the bettor.

It is true that many countries including some of the most pious theocracies have a double standard when it comes to gambling and some even have state gambling on the pretext that these are more fairly run! These seldom change the ratio of winners to losers and even when gambling is run by the state it amounts to no more than a form of taxation, since it goes into the coffers of the state. Readers are of course familiar with the Lotto and how those proceeds are divvied up.

But the operation of casinos takes gambling to a different level and it is not surprising that even in the gambling capitals of the world, it is one of if not the most regulated activity. Indeed in some places they are deemed financial institutions for reporting purposes under money laundering laws and law enforcement officers and other regulators are present in casinos to manage crime and to ensure that no illegality is perpetrated.

That Guyana is proposing entry into this minefield raises questions well beyond the moral and religious and speaks to the type of society we wish to create. Few doubt that significant sectors and activities are already criminalized and as we scan the landscape on which casinos are being proposed, this is what we see:

1. Significant segments of our economy are dominated by unethical business practices, financed by unexplained funds and thrive on tax evasion.

2. There is great fear of even mentioning the names of certain individuals and businesses which extends beyond the fear of libel to fear of being harmed by agents of those who consider themselves as beyond question.

3. We have had recent experiences of officially sanctioned phantoms who according to a prominent citizen are now spawning baby phantoms.

4. The level and quality of regulatory enforcement in banking, the non-bank cambios, insurance and corporate and securities are at best merely superficial and ineffective.

5. Our police force is struggling to shed an image of incompetence and corruption, of questionable leadership and has been the subject of much study and recommendations but no action.

6. Public sector wages including those of the police are so low that bribery and corruption are an accepted fact.

7. A highly deficient court system that is seen by many as compromised, inept and unable to deliver justice. Not a single successful prosecution has been brought against any major personality before the courts.

8. A political culture characterized by poor governance, little accountability and increasingly seen as compromised by shady interests.

In the context of this environment, I draw attention to some of the dangers of casino gambling from actual examples in states/countries where casinos operate.

1. The Maryland Attorney General Curran’s Executive Summary On Casino Gambling is quoted as saying: “Known mob figures frequent casinos to gamble and launder money, and organized crime families attempt continually to infiltrate ancillary industries and to capitalize on an increased market for drugs, illegal gambling, and other ills.”

2. Dexter Temple, a confessed former drug dealer told the Des Moines Register that “Iowa drug dealers have pinpointed casinos as ideal places to quietly launder the large bills they earn selling methamphetamine, cocaine or other illegal drugs.” He noted that “When you think about it, you’ve got some money in your pocket or you’re making money off drugs, it’d be a good place to go and hit a jackpot and have some ‘legitimate’ money.”

3. The New York/New Jersey High Intensity Drug Trafficking Area (HIDTA) estimates that drug traffickers launder between $4 billion and $8 billion annually in the New York/Northern New Jersey metropolitan area. A report out of that state body notes that the gaming industry in the United States remains vulnerable to drug money laundering and identifies as one of the techniques used to launder drug proceeds through casinos, the structuring of cash purchases of casino chips or tokens to avoid reporting requirements and subsequently redeeming the chips for cheques drawn on, or wire transfers from, casino bank accounts.

4. Corruption can also involve casino employees and operators and one former Bally’s (a top Las Vegas Casino) casino host was convicted after pleading guilty to charges of money laundering and helping to wash drug-trafficking proceeds. One such case surfaced from a sting operation in which the operator allowed a ‘customer’ to use fake identifications to launder more than $400,000 of drug money. In fact one host in that case admitted that his job as a host was to help high-rollers who wanted to gamble.

5. Nevada, which can claim to be the gambling capital of the world, has one of the largest FBI offices in the USA because of crime linked to gambling.

6. Following a cocaine and marijuana bust some years ago, Peter Djinis, associate director of the Treasury Department’s Financial Crimes Enforcement Network in the US, known as FinCEN, reported that casinos are easy targets for criminals seeking ways to disguise origins of money.

7. U.S. Representative Frank Wolf (R) of Virginia lamented in a letter to President Bush that ‘Casino gambling … is now coming to cities and even small towns across America and bringing with it all its social ills, like higher crime and suicide rates, increased personal bankruptcies, and the breakup of families.’

8. The US DEA reports that Canadian drug traffickers are laundering illicit cash and clandestinely shipping shady money to the Caribbean and South America, again using casinos to launder their proceeds by the standard technique of purchasing and surrendering chips or opening an account at the gambling establishment.

9. In 2004, the Canadian Broadcasting Corporation reported law enforcement officials as saying that loan sharking, money laundering and other criminal activities have become a reality inside Ontario’s legalized casinos.

10. In 2005, the Conservative Party Leader in the UK Michael Howard stepped up his attack on the Government over money laundering concessions for casino operators.

11. The (Scottish) Sunday Herald quotes Jeffrey Robinson, the UK Gaming Regulator Chief and a leading authority on money laundering as warning that Britain must take action to prevent suffering the same fate as the US, where, he says, casinos are still viewed by organised crime groups as “giant Laundromats”.

12. In the Caribbean Aruba has been named in “The Drug Trade in the Caribbean: A Threat Assessment” as playing a significant role as an offshore centre for drug-related money laundering while Trinidad and Tobago, not an important regional or offshore financial centre, has been used by drug traffickers to launder money using overvalued purchase prices, real estate, casinos, stockbrokers, insurance companies, and other non-financial establishments.

13. The argument that casino gambling will promote tourism and economic development is best answered by Attorneys Guy Martin, Don Baur and Jena MacLean, Perkins Coie, LLP of the USA who told a gathering of the International Municipal Lawyers’ Association in 2003 that ‘for every dollar a community collects from gambling taxes, it must spend three dollars to cover new expenses, including police, infrastructure repairs, social welfare and counseling services.’

I am not at all convinced of the reasons for rushing into law casino gambling, or why President Jagdeo believes that genuine tourists as opposed to those merely looking for a laundry service would prefer Guyana to other established gambling locations, or why he would wish to alienate large segments of the Guyana population to favour casinos which benefit only a few. The fact that this was not part of the manifesto that the PPP/C offered the populace in a covenant for their votes makes the case for an informed debate inescapable. It is not something that should be taken by Guyanese as a done deal.

Given the potential for casino gambling of a further criminalised economy shunned by serious investors, this is a defining issue which imposes on all Guyanese a historic duty to contribute to the debate. As Abraham Lincoln said ‘To sin by silence when they should protest makes cowards of men’ (and women).

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