Former MGM Grand President Scott Sibella has pleaded guilty to a federal criminal charge related to an illegal sports betting bookmaking business.
The Justice Department announced Thursday that Sibella failed to file reports of suspicious transactions required by the Bank Secrecy Act. It comes as part of an investigation into alleged money laundering violations involving MGM casino patron Wayne Nix, a former bookie.
Feds: Sibella wine and dined bookie
Sibella, who served as the president of MGM Grand through February 2019, knowingly allowed Nix to gamble at the casino with illicit proceeds, according to his plea agreement.
He authorized complimentary benefits for Nix, including meals, room, board, and golf trips with senior executives and high net-worth customers. Sibella failed to report Nix’s status as an illegal sports bookmaker, leading to MGM Grand’s failure to file necessary suspicious activity reports.
‘I didn’t want to know’
Sibella told law enforcement in 2022 that he believed Nix was involved in illegal bookmaking, according to newly unsealed court documents:
“[I] didn’t want to know because of my position,… If we know, we can’t allow them to gamble…. I didn’t ask, I didn’t want to know I guess because he wasn’t doing anything to cheat the casino.”
MGM casinos took $5 million of Nix money
The MGM Grand admitted that Nix would use the golf trips to groom new customers into his illegal bookmaking business. The Cosmopolitan, also operated by MGM Resorts International, admitted that Nix used illicit proceeds at the casino and received complimentary benefits aimed at encouraging him to do so.
By 2020, both casinos had accepted a combined $5 million in cash that was illicit proceeds from Nix’s illegal bookmaking business.
“Financial institutions have a duty under the law to report criminal or suspicious activity occurring at the institution though SARs,” said First Assistant United States Attorney Joseph McNally said in a press release. “Our office will aggressively prosecute corporate executives and employees who turn a blind eye to criminal actors depositing illegal funds at casinos and financial institutions.”
MGM on hook for $7.45 million
The MGM Grand and The Cosmopolitan admitted to laundering Nix’s illicit funds and failing to file proper suspicious activity reports.
They agreed to a cominbed $7.45 million in settlements, which mandate enhancements to their anti-money laundering (AML) compliance programs.
Both casinos must invest at least $750,000 in an external compliance reviewer over two years, as part of their Non-Prosecution Agreements.
Sibella, Nix await sentencing
Sibella faces a maximum penalty of five years in prison and a $250,000 fine. His sentencing hearing is scheduled for May 8.
Nix pleaded guilty in April 2022 to federal charges of conspiracy to operate an illegal gambling business and subscribing to a false tax return. His sentencing is scheduled for March 6.
The case was investigated by Homeland Security‘s El Camino Real Financial Crimes Task Force and the IRS Criminal Investigation unit.