Drama with Scott Sibella started last year when he was removed from his position as president of Resorts World Las Vegas while he was being investigated by the federal government. The drama concluded this year as he pleaded guilty to violating the Bank Secrecy Act (BSA).
This week, the U.S. Department of Justice (DOJ) announced that Sibella, a former MGM Grand and Resorts World Las Vegas executive, pleaded guilty to one count of failure to file reports of suspicious transactions required to be made by casinos by the BSA. The crimes occurred from 2017 to 2019 while Sibella was president of MGM Grand.
Special Agent in Charge Tyler Hatcher, IRS Criminal Investigation, Los Angeles Field Office, said in a DOJ news release:
“Mr. Sibella’s willful violation of Bank Secrecy Act obligations to report suspicious activities put the credibility of the MGM Grand at risk … While president of MGM Grand, Mr. Sibella undermined the trust and confidence of his employees, customers, and regulating agencies, and for that, he will be held accountable.
Additionally, the non-prosecution agreements with MGM Grand Hotel, LLC and The Cosmopolitan of Las Vegas should serve as notice to other casinos and financial institutions that evading BSA obligations can carry severe consequences, and we will investigate suspected non-compliance.”
While Sibella committed the crimes, his employer is also on the hook regarding this money laundering scheme, the DOJ said. MGM Grand and The Cosmopolitan have also made settlements with the justice department.
The MGM Resorts casinos will pay a combined $7.45 million penalty. They will also undergo an external review and improve their anti-money laundering (AML) compliance program.
Former Major League Baseball player at the center of charges
The crimes stem from Sibella’s relationship with an illegal bookie, former Major League Baseball player Wayne Nix, according to the release. Sibella allowed Nix to gamble at MGM Grand and other affiliated casinos with money he made from his illegal gambling business without notifying the casino’s compliance department.
Sibella also approved Nix to receive numerous complimentary benefits to keep him at the casino. In addition to complimentary rooms and meals, he set Nix up with golf trips that included senior executives and other high net-worth customers of the casinos.
Shibella’s tactics encouraged Nix to visit MGM Grand and to a lesser extent The Cosmopolitan.
According to the justice department, Sibella knew that he should report that Nix was an illegal sports bookie to MGM Resorts’ corporate office. Since he failed to report the suspicious activity, MGM Grand failed to file at least one report regarding Nix’s source of income.
In his plea deal, Sibella admitted that he understood he was skirting the law:
“(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.”
The DOJ said three casino hosts at the two Las Vegas casinos were also aware of Nix’s illegal bookmaking.
MGM Grand and The Cosmopolitan to pay fines
While Sibella was the catalyst of illegal activities, two Las Vegas casinos, the MGM Grand and The Cosmopolitan, admitted they accepted money from Nix.
- MGM Grand agreed to pay a fine of $6,527,728.
- The Cosmopolitan will pay $928,600.
Both casinos will forfeit $500,000 in proceeds that were tracked back to the violation. This is being counted towards the fine.
In a letter to the Justice Department, MGM Grand confirmed that Sibella and two hosts were all aware of Nix’s illegal bookmaking and still allowed him to gamble at the casino. Altogether, MGM Grand accepted $4,079,830 in cash from Nix’s illegal business.
Meanwhile, The Cosmopolitan admitted that one of its hosts knew where Nix obtained money. The host also failed to report the $928,600 in illegally obtained money to The Cosmopolitan.
Sibella will be sentenced on May 8. He will face a maximum penalty of five years in prison and a fine of $250,000. It might not be the end of Sibella’s troubles. Activist gambler Robert Cipriani has sued Sibella and Resorts World, according to Bonus.com.
Nix will be sentenced first. He is scheduled to be sentenced on March 6. He already pled guilty to one count of conspiracy to operate an illegal gambling business and one count of submitting a false tax return in April 2022.