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Former MGM Mirage Official Arrested

State gaming regulators Wednesday upped the stakes in its case against MGM Mirage for failing to file thousands of required anti-money laundering reports by arresting a former Mirage official on criminal charges.

Christopher Morishita, 33, Wednesday was charged with four counts of failure to maintain required currency transactions records.

He was being held at the Clark County Detention Center on $120,000 bond.

The former anti-money laundering compliance officer at The Mirage could face up to 10 years in prison and $50,000 in fines, said Keith Copher, chief of enforcement for the control board.

It was the first time an individual has been criminally charged with violating the state's currency transaction regulations, he said.

Copher could not discuss details of the pending case against Morishita or MGM Mirage, including other possible targets of the investigation and the extent of Morishita's role. Industry officials, however, agreed the criminal charges show the seriousness of the case.

"I think the state authorities clearly are taking a much more serious look at the enforcement of these rules and regulations than they have in the past and that is not a bad thing," said a senior industry source who asked not to be named.

Gaming expert and University of Nevada, Las Vegas professor Bill Thompson said the control board would have needed to find some evidence of intent for Morishita to not file the paperwork -- possibly in retaliation against MGM Mirage or as a favor to someone -- to justify the criminal charges.

"It's very, very serious if they're doing criminal charges. If they get a conviction, especially involving doing favors, it changes the picture of Vegas and how clean the gaming industry may be. It'll change the image of Vegas," he said.

Some industry sources have suggested problems at The Mirage started after an employee responsible for filing the reports was cut off from their "comp privileges" at the resort and retaliated by not filing the paperwork.

Gaming Control Board Chairman Dennis Neilander could not be reached for comment Wednesday, but previously said a two-month investigation into the failure of The Mirage to file almost 15,000 anti-money laundering reports had been completed and confirmed widespread and serious violations of the anti-money laundering regulations. Neilander, however, said the investigation showed no evidence of criminal action by the resort or of any money-laundering activities.

Copher said the criminal charges were filed after the other two control board members accepted Neilander's report and referred the information to the state attorney general's office. Meanwhile, the attorney general's office is still negotiating with MGM Mirage, holding company for The Mirage, to see if a stipulated agreement can be reached on a penalty for the company. MGM Mirage officials could not be reached for comment Wednesday.

In February, stories surfaced that The Mirage had failed to file nearly 14,000 anti-money laundering reports over an 18-month period beginning in 2001 and could face $350 million in civil penalties.

The reports are filed with the Financial Crime Network of the U.S. government and are used to track large cash transactions by individuals in casinos.

The fine for failing to submit the reports is $25,000 per count, but the state has yet to determine how many failures to file occurred and how many would be considered infractions.

For a particular report to be missing is not unusual, but the extent of this case is abnormal, industry sources agreed.

The failure of The Mirage to file currency reports was first discovered in mid-December after a regularly scheduled audit that examined compliance with regulation 6A, which requires the currency reports.

Station Casinos and the control board in April launched an unrelated investigation into the failure of that company to file the same reports.

Casinos are required to track cash transactions of $3,000 or more and to submit currency reports whenever cash transactions by any individual total more than $10,000 in any 24-hour period.

The reports are filled out manually, usually at the cages on casino floors. The reports are turned over to company officials for auditing before they are mailed to the Treasury Department.

Big properties typically submit 50 or 60 such forms every five days. A few properties on the Strip might submit up to 400 every five days during peak periods of play.

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