1506-0051-Casinos AML Program Supporting Statement 10_28_2024 FINAL

Supporting Statement

OMB Control Number 1506-0051

Anti-Money Laundering Program Requirements for Casinos.

1. Circumstances necessitating collection of information.

The legislative framework generally referred to as the Bank Secrecy Act (BSA) consists of the Currency and Foreign Transactions Reporting Act of 1970, as amended by the Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism Act of 2001 (USA PATRIOT Act)¹ and other legislation, including the Anti-Money Laundering Act of 2020 (AML Act).² The BSA is codified at 12 U.S.C. 1829b, 1951–1960 and 31 U.S.C. 5311–5314, 5316–5336, including notes thereto, with implementing regulations at 31 CFR chapter X.

The BSA authorizes the Secretary of the Treasury (Secretary) to, inter alia, require financial institutions to keep records and file reports that are determined to have a high degree of usefulness in criminal, tax, or regulatory matters, risk assessments or proceedings, or in the conduct of intelligence or counter-intelligence activities to protect against terrorism, and to implement anti-money laundering/countering the financing of terrorism (AML/CFT) programs and compliance procedures.³ The authority of the Secretary to administer the BSA has been delegated to the Director of FinCEN.⁴

Pursuant to 31 U.S.C. 5318(h)(1), financial institutions must establish AML/CFT programs to guard against money laundering and the financing of terrorism.⁵ Such programs must include, at a minimum: (a) the development of internal policies, procedures, and controls; (b) the designation of a compliance officer; (c) an ongoing employee training program; and (d) an independent audit function to test programs.⁶ On March 12, 1993, FinCEN issued regulations, under separate statutory authority codified at 31 U.S.C. 5318(a)(2), requiring casinos to develop and implement written BSA compliance programs.⁷ FinCEN subsequently amended those regulations after passage of the USA PATRIOT Act to state that a casino would be “deemed to satisfy the requirements of 31 U.S.C. 5318(h)(1) if it implements and maintains” an AML program, as described in” 31 CFR 1021.210(b).⁸

2. Method of collection and use of data.

AML programs help to ensure that casinos comply with the BSA, including requirements related to retention and maintenance of reports and records, and ensure that such institutions are not used to facilitate money laundering or terrorist financing. These requirements will assist law enforcement in financial investigations, protect against terrorism and strengthen national security, improve financial institutions’ ability to assess and mitigate risk, help prevent evasion of financial sanctions, facilitate tax compliance, enhance financial transparency of legal entities, and advance U.S. compliance with international standards and commitments. Compliance with these requirements will be reviewed by Federal agencies during BSA examinations.

3. Use of improved information technology to reduce burden.

Casinos are not required to automate their systems to meet AML requirements, but 31 CFR 1021.210(b)(2)(vi) provides that, if the casino has automated data processing systems, it must use automated programs to aid in ensuring compliance.

4. Efforts to identify duplication.

There is no similar information available; thus there is no duplication.

5. Methods to minimize burden on small businesses or other small entities.

Casinos are required to document their AML programs and are permitted to use the method most suitable to their requirements.

6. Consequences to the Federal government of not collecting the information.

A copy of the AML program must be made available for inspection by the Department of the Treasury or an appropriate regulatory agency only upon request. 

7. Special circumstances requiring data collection inconsistent with guidelines.

Under 31 CFR 1010.430(d), all records that are required to be retained by 31 CFR Chapter X, including a written copy of the AML program, must be retained for a period of five years. Records may be used in connection with civil penalty actions that are subject to statutes of limitation longer than three years, to verify compliance with, among other BSA requirements, the requirement to maintain an AML program.

8. Consultation with individuals outside of the agency on availability of data, frequency of collection, clarity of instructions and forms, and data elements.

On August 13, 2024, FinCEN published in the Federal Register a notice and request for comments of its intention to renew, without change, information collection requirements for AML programs for casinos.⁹ The comment period closed on October 15, 2024. FinCEN received two comments in response to the notice. However, neither of the comments addressed the casino AML program requirements or burden estimates.

FinCEN appreciates feedback provided by commenters and will take recommendations into consideration as part of the future rulemaking. In addition, as noted in the 60-day notice to renew this information collection, in connection with a variety of initiatives FinCEN is undertaking to implement the AML Act, FinCEN intends to conduct, in the future, additional assessments of the PRA burden associated with BSA requirements. This supporting statement does not address requirements that may be imposed under section 6101(b) of the AML Act. Paperwork and respondent burden for those requirements will be addressed in a separate final rule.

9. Explanation of decision to provide any payment or gift to respondents.

No payments or gifts were made to respondents.

10. Assurance of confidentiality of responses.

Information collected under an AML program established pursuant to 31 U.S.C. 5318(h) may be made available to appropriate law enforcement agencies and supervisory agencies.

11. Justification of sensitive questions.

There are no questions of a sensitive nature in the collection of information. Any personally identifiable information collected under the BSA is strictly controlled as outlined in FinCEN’s Systems of Records Notice.¹⁰

12. Estimated burden of information collection.

Frequency: As required.

Estimated Number of Respondents: 1,277 casinos.

Table 1. Distribution of casinos covered by this notice, by type of casino

Type of casino	Number of casinos
Casino	486
Tribal casino	525
Card club	266
Total number of casinos	1,277a
a Estimate based on the American Gaming Association (AGA) “State of Play,” reporting 486 commercial casinos and 525 Tribal casinos as of December 31, 2023 (available at https://www.americangaming.org/state-of-play/, accessed February 28, 2024). As of December 31, 2022, there were also 266 card rooms as published in the AGA’s “State of the States” annual report, p. 16 (available at https://www.americangaming.org/wpcontent/uploads/2023/05/AGA-State-of-the-States-2023.pdf, accessed February 28, 2024).

Estimated Total Recordkeeping Burden Hours: 127,912.

FinCEN’s estimate of the annual PRA burden is 127,912 hours, as detailed in table 2 below.

Table 2. Distribution of the estimated total annual burden hours per requirement

Required activities	Instances per year	Time per instance	Number of casinos	Total hourly burden
Maintaining and updating the written AML program	1 per casino	1 hour	1,277	1,277
Storing the written AML program	1 per casino	5 minutes	1,277	106*
Producing the AML program upon request	1 per casino	5 minutes	1,277	106*
Ongoing compliance with the requirements in 31 CFR 1021.210(b)(2)(v) and (vi)	1 per casino	99 hours	1,277	126,423
Total hourly burden				127,912

*106.41 rounded to 106

13. Estimated total annual cost burden of the information collection.

FinCEN is utilizing the same fully-loaded composite hourly wage rate of $106.30 utilized in the 2024 NPRMs entitled Customer Identification Programs for Registered Investment Advisers and Exempt Reporting Companies and Anti-Money Laundering and Countering the Financing of Terrorism Programs, as well as in recent 60-Day Notices to renew OMB control numbers corresponding to specific BSA regulations.¹¹

The total estimated cost of the annual PRA burden is $13,597,045.60, as reflected in table 3 below:

Table 3. Estimated total cost of annual PRA burden

Required activities	Burden hours	Wage rate	Total cost
Maintaining and updating the written AML program	1,277	$106.30	$135,745.10
Storing the written AML program	106	$106.30	$11,267.80
Producing the AML program upon request	106	$106.30	$11,267.80
Ongoing compliance with the requirements in 31 CFR 1021.210(b)(2)(v) and (vi)	126,423	$106.30	$13,438,764.90
Total cost			$13,597,045.60

Estimated Total Annual Recordkeeping Cost: $13,597,045.60.

There are no estimates of non-labor costs associated with this collection of information.

14. Estimated annual cost to the Federal government.

A copy of the AML program must be made available to the Department of the Treasury or an appropriate regulatory agency only upon request; therefore, the estimated annual cost to the Federal government is $0.

15. Reason for change in burden.

The estimated total annual burden hours increased from 99,466 hours in 2020 to 127,912 hours in 2024. The estimated burden for casinos to implement and maintain an AML compliance program remained at approximately 100 hours per casino, with 5 minutes to store the written AML program and 5 minutes to produce the written program upon request. The increase in burden is due to an increase in the number of casinos from 993 in 2020 to 1,277 in 2024.

16. Plans for tabulation, statistical analysis, and publication.

This collection of information will not be tabulated or compiled for publication.

17. Request not to display the expiration date of the OMB control number.

FinCEN requests that it not be required to display the expiration date so that the regulations will not have to be amended for the new expiration date every three years. This request will not affect the normal three-year PRA renewal process.

18. Exceptions to the certification statement.

There are no exceptions to the certification statement.

1 USA PATRIOT Act, Pub. L. 107-56, 115 Stat. 272 (2001).

2 The AML Act was enacted as Division F, sections 6001-6511 of the William M. (Mac) Thornberry National Defense Authorization Act for Fiscal Year 2021, Pub. L. 116-283, 134 Stat. 3388.

3 See 31 U.S.C. 5311.

4 Treasury Order 180–01 (Jan. 14, 2020); see also 31 U.S.C. 310(b)(2)(I) (providing that the FinCEN Director shall “[a]dminister the requirements of subchapter II of chapter 53 of this title, chapter 2 of title I of Public Law 91–508, and section 21 of the Federal Deposit Insurance Act, to the extent delegated such authority by the Secretary.”).

5 The provision was added to the BSA through Section 352 of the USA PATRIOT Act and authorizes FinCEN to prescribe minimum standards for AML programs and to exempt certain financial institutions from application of those standards. Section 6101(b) of the AML Act amended the provision to include explicit references to terrorism finance and to specify the factors that FinCEN must consider in prescribing minimum standards.

6 See 31 U.S.C. 5318(h)(1)(A)-(D).

7 See FinCEN, Regulations Regarding Reporting and Recordkeeping Requirements by Casinos, 58 FR 13538 (Mar. 12, 1993). The regulations were codified at 31 CFR 1021.210. Card clubs are included in the casino AML program regulations, and any reference to casinos used in BSA regulations includes card clubs, unless specifically noted. See 31 CFR 1010.100(t)(5)(iii).

8 See FinCEN, Anti-Money Laundering Programs for Financial Institutions, 67 FR 21110 (Apr. 29, 2002). The amended regulations are codified at 31 CFR 1021.210(a).

9 See FinCEN, Agency Information Collection Activities; Proposed Renewal; Comment Request; Renewal Without Change of Anti-Money Laundering Program Requirements for Casinos, 89 FR 65977 (Aug. 14, 2024).

10 See FinCEN, Privacy Act of 1974, Systems of Records Notice, 79 FR 20969 (Apr. 14, 2014).

11 See, e.g., FinCEN and SEC, NPRM Customer Identification Programs for Registered Investment Advisers and Exempt Reporting Advisers, 89 FR 44571 (May 21, 2024); FinCEN, NPRM Anti-Money Laundering and Countering the Financing of Terrorism Programs NPRM, 89 FR 55428 (July 3, 2024); FinCEN, Agency Information Collection Activities; Proposed Renewal; Comment Request; Renewal Without Change of the Customer Identification Program Regulatory Requirements for Certain Financial Institutions, 89 FR 51940 (June 20, 2024); FinCEN, Agency Information Collection Activities; Proposed Renewal; Comment Request; Renewal Without Change of Due Diligence Programs for Correspondent Accounts for Foreign Financial Institutions and for Private Banking Accounts, 89 FR 49273, (June 11, 2024).

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