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Casino Executive Grilled by Nevada Regulator

LAS VEGAS - Nevada Gaming Control Board member Bob Siller questioned Bally's-Paris casino executive Joseph Rahi on Wednesday, trying to determine whether Rahi recognized his role in an apparent money laundering scheme.

Rahi first denied any wrongdoing in the 1998 Atlantic City case that was part of a federal undercover operation.

He was later found innocent in federal court of any crimes connected to the episode, but in May 2000 he was banned by New Jersey gaming regulators from working until June of this year in that state's casino industry.

The ban led Rahi to seek work in Las Vegas, leading to his appointment as Paris-Bally's vice president of Middle Eastern and European operations - and it led to the control board hearing.

So there was Siller pushing Rahi for answers as the casino executive sought a state-issued, key-employee license.

"There's a whole lot of information here that you're not sharing," lectured the former FBI special agent. "If I have to walk you through it, that's not going to be a good situation."

Rahi lawyer David Arraj said Internal Revenue Service transcripts of the incident at the Showboat Atlantic City were clear on Rahi's role in the affair.

"I want to hear it from your client," Siller calmly replied. "We don't want anyone in the industry who shuts their eyes to things."

"I told him no," Rahi said of the casino customer seeking illegal advice. "I started to notice the seriousness of the issue at a later stage.

"Then I sensed it was wrong. I was scared. I didn't know how to react. I hid from it. I ran away from it."

A contrite Rahi eventually received a control board recommendation that he be given a temporary three-year state license to fill his casino job.

But Siller voted against the recommendation, which was supported by his two colleagues, and was dogged in his questioning in the 75 minutes leading to the vote. The recommendation awaits the consideration of the Nevada Gaming Commission.

Rahi told control board members of warning Middle Eastern high roller Emadeldin Abdelraouf and a friend that gamblers must report to the IRS bets totaling $10,000 or more in any 24-hour period.

That law and a similar Nevada regulation are designed to prevent the exchange of criminally obtained money for legitimate dollars.

What Rahi didn't know then was that Abdelraouf was working as an informant for the IRS, and the friend was an undercover IRS agent wearing a microphone.

The wire produced the transcript that Siller used in his questioning, which soon saw Rahi acknowledge that he had explained techniques to bypass federal cash transaction laws.

One popular method: have several friends buy casino chips for $9,900 each and then give them to Abdelraouf.

"So you were really aiding him at that time," Siller said, pushing Rahi for an answer.

"It is true on the legal part of it," the Paris-Bally's executive replied.

Siller quoted transcribed comments delivered by Rahi that appeared to anger the control board member.

"The law in Atlantic City is like an octopus," Rahi was quoted as saying. "In Vegas they don't give a (expletive). It's a desert. They want to keep the money coming.

"Atlantic City is very clean. Believe me, Vegas is the way."

Dressed in a dark blue suit, white shirt and neck tie, Rahi admitted to delivering the remarks, but he implored Siller and his board colleagues to consider their context.

"Believe me, I'm brushing him away," Rahi said of Abdelraouf's overtures. "Those are my words. I'm a salesman. I'm trying to brush him off. That is my answer."

As the control board vote neared, Siller admonished Rahi with what he said was a favorite personal saying.

"Everyone is not the architect of his future," Siller said, "but he is the architect of his character."

Siller voted no.

"We have an obligation to protect this community, gaming here," he said.

But control board Chairman Dennis Neilander and board member Scott Scherer OK'd the temporary license, saying Rahi did not appear to knowingly violate the law and otherwise had no run-ins with the law.

"You now know the rules. You now know what your obligations are," Scherer lectured.

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