Proposal of Special Measure Regarding Transactions Involving Ten Mexican Gambling Establishments as a Class of Transactions of Primary Money Laundering Concern

DEPARTMENT OF THE TREASURY <SUBAGY>Financial Crimes Enforcement Network</SUBAGY> <CFR>31 CFR Part 1010</CFR> <RIN>RIN 1506-AB70</RIN> <SUBJECT>Proposal of Special Measure Regarding Transactions Involving Ten Mexican Gambling Establishments as a Class of Transactions of Primary Money Laundering Concern</SUBJECT> <HD SOURCE="HED">AGENCY:</HD> Financial Crimes Enforcement Network (FinCEN), Treasury. <HD SOURCE="HED">ACTION:</HD> Notice of proposed rulemaking. <SUM> <HD SOURCE="HED">SUMMARY:</HD> FinCEN is issuing a notice of proposed rulemaking, pursuant to section 311 of the USA PATRIOT Act, that finds transactions involving ten identified Mexico-based gambling establishments to be a class of transactions of primary money laundering concern, and proposes imposing a special measure to: (1) prohibit U.S. financial institutions from opening or maintaining a correspondent account for any foreign banking institution if such account is used to process transactions involving any of the gambling establishments, and (2) require U.S. financial institutions to apply special due diligence to their correspondent accounts that is reasonably designed to guard against the use of such accounts to process transactions involving any of the gambling establishments. </SUM> <EFFDATE> <HD SOURCE="HED">DATES:</HD> Written comments on the notice of proposed rulemaking must be submitted on or before December 17, 2025. </EFFDATE> <HD SOURCE="HED">ADDRESSES:</HD> Comments must be submitted in one of the following two ways (please choose only one of the ways listed): • <E T="03">Federal E-rulemaking Portal: https://www.regulations.gov.</E> If you are reading this document on <E T="03">federalregister.gov,</E> you may use the green “SUBMIT A PUBLIC COMMENT” button beneath this rulemaking's title to submit a comment to the <E T="03">regulations.gov</E> docket. • <E T="03">Mail:</E> Financial Crimes Enforcement Network, P.O. Box 39, Vienna, VA 22183. Refer to Docket Number FINCEN-2025-0138 in the submission. Do not include any personally identifiable information (such as name, address, or other contact information) or confidential business information that you do not want publicly disclosed. All comments are public records; they are publicly displayed exactly as received, and will not be deleted, modified, or redacted. Comments may be submitted anonymously. Follow the search instructions on <E T="03">https://www.regulations.gov</E> to view public comments. <FURINF> <HD SOURCE="HED">FOR FURTHER INFORMATION CONTACT:</HD> FinCEN's Regulatory Support Section at <E T="03">www.fincen.gov/contact.</E> </FURINF> <SUPLINF> <HD SOURCE="HED">SUPPLEMENTARY INFORMATION:</HD> <HD SOURCE="HD1">I. Statutory Provisions</HD> Section 311 of the USA PATRIOT Act  <SU>1</SU> <FTREF/> (section 311), codified at 31 U.S.C. 5318A, grants the Secretary of the Treasury (Secretary) the authority to make a finding that “reasonable grounds exist for concluding” that any of the following “is of primary money laundering concern”: <FTNT> <SU>1</SU>  Uniting and Strengthening America by Providing Appropriate Tools Required to Intercept and Obstruct Terrorism (USA PATRIOT) Act of 2001, Public Law 107-56, 115 Stat. 272 (Oct. 26, 2001). </FTNT> (i) A jurisdiction outside of the United States; (ii) One or more financial institutions operating outside of the United States; (iii) One or more classes of transactions within, or involving, a jurisdiction outside of the United States; or (iv) One or more types of accounts. <SU>2</SU> <FTREF/> <FTNT> <SU>2</SU>  31 U.S.C. 5318A(a)(1). </FTNT> Upon making such a finding, the Secretary is authorized to require domestic financial institutions and domestic financial agencies—collectively, “covered financial institutions”—to take certain “special measures.” The five special measures set out in section 311 are safeguards that may be employed to defend the U.S. financial system from money laundering and terrorist financing risks. The Secretary may impose one or more of these special measures to protect the U.S. financial system from such threats. Through special measures one through four, the Secretary may impose additional recordkeeping, information collection, and reporting requirements on covered financial institutions. <SU>3</SU> <FTREF/> Through special measure five, the Secretary may “prohibit, or impose conditions upon, the opening or maintaining in the United States of a correspondent account or payable-through account” for or on behalf of a foreign banking institution, if such correspondent account or payable-through account involves the class of transactions found to be of primary money laundering concern. <SU>4</SU> <FTREF/> <FTNT> <SU>3</SU>  31 U.S.C. 5318A(b)(1)-(4). For purposes of this proposed rulemaking, the term “covered financial institution” has the same meaning as provided at 31 CFR 1010.605(e)(1); <E T="03">see infra</E> Section VI.A.3. </FTNT> <FTNT> <SU>4</SU>  31 U.S.C. 5318A(b)(5). </FTNT> Before making a finding that reasonable grounds exist for concluding that a class of transactions (or other jurisdiction, financial institution, or account) is of primary money laundering concern, the Secretary is required to consult with both the Secretary of State and the Attorney General. <SU>5</SU> <FTREF/> In addition, in making a finding that reasonable grounds exist for concluding that a class of transactions is of primary money laundering concern, the Secretary is required to consider such information as the Secretary determines to be relevant, including the following potentially relevant institutional factors: <FTNT> <SU>5</SU>  31 U.S.C. 5318A(c)(1). </FTNT> • The extent to which such a class of transactions is used to facilitate or promote money laundering in or through a jurisdiction outside the United States, including any money laundering activity by organized criminal groups, international terrorists, or entities involved in the proliferation of weapons of mass destruction (WMD) or missiles. • The extent to which such a class of transactions is used for legitimate business purposes in the jurisdiction; and • The extent to which such action is sufficient to ensure that the purposes of section 311 continue to be fulfilled, and to guard against international money laundering and other financial crimes. <SU>6</SU> <FTREF/> <FTNT> <SU>6</SU>  31 U.S.C. 5318A(c)(2)(B)(i)-(iii). In addition, in the case of a finding relating to a particular jurisdiction, section 311 sets out certain “jurisdictional factors” that the Secretary may consider, which are not relevant here. <E T="03">See</E> 31 U.S.C. 5318A(c)(2)(A)(i)-(vii). </FTNT> In selecting one or more special measures, the Secretary “shall consult with the Chairman of the Board of Governors of the Federal Reserve System, any other appropriate Federal banking agency (as defined in section 3 of the Federal Deposit Insurance Act), the Secretary of State, the Securities and Exchange Commission, the Commodity Futures Trading Commission, the National Credit Union Administration Board, and in the sole discretion of the Secretary, such other agencies and interested parties as the Secretary may find appropriate.”  <SU>7</SU> <FTREF/> When imposing special measure five, the Secretary must do so “in consultation with the Secretary of State, the Attorney General, and the Chairman of the Board of Governors of the Federal Reserve System.”  <SU>8</SU> <FTREF/> In addition, the Secretary is required to consider the following factors: <FTNT> <SU>7</SU>  31 U.S.C. 5318A(a)(4)(A). </FTNT> <FTNT> <SU>8</SU>  31 U.S.C. 5318A(b)(5). </FTNT> • Whether similar action has been or is being taken by other nations or multilateral groups; • Whether the imposition of any particular special measure would create a significant competitive disadvantage, including any undue cost or burden associated with compliance, for financial institutions organized or licensed in the United States; • The extent to which the action or the timing of the action would have a significant adverse systemic impact on the international payment, clearance, and settlement system, or on legitimate business activities involving the particular jurisdiction, institution, class of transactions, or type of account; and • The effect of the action on United States national security and foreign policy. <SU>9</SU> <FTREF/> <FTNT> <SU>9</SU>  31 U.S.C. 5318A(a)(4)(B)(i)-(iv). </FTNT> The authority of the Secretary to administer the Bank Secrecy Act (BSA)  <SU>10</SU> <FTREF/> and its implementing regulations, including the authority under section 311 to make such a finding and to impose special measures, has been delegated to FinCEN. <SU>11</SU> <FTREF/> <FTNT> <SU>10</SU>  The BSA, as amended, is the popular name for a collection of statutory authorities that FinCEN administers that is codified at 12 U.S.C. 1829b, 1951-1960, and 31 U.S.C. 5311-5314, 5316-5336, and includes other authorities reflected in notes thereto. Regulations implementing the BSA appear at 31 CFR Chapter X. </FTNT> <FTNT> <SU>11</SU>   <E T="03">See</E> Treasury Order 180-01 (Jan. 14, 2020). </FTNT> <HD SOURCE="HD1">II. Summary</HD> The ten Mexican gambling establishments at issue in this Notice of Proposed Rulemaking (NPRM)—namely, (1) Emine Casino (San Luis Rio Colorado, Sonora); (2) Casino Mirage (Culiacan, Sinaloa); (3) Midas Casino (Agua Prieta, Sonora); (4) Midas Casino (Guamúchil, Sinaloa); (5) Midas Casino (Los Mochis, Sinaloa); (6) Midas Casino (Mazatlan, Sinaloa); (7) Midas Casino (Rosarito, Baja California); (8) Palermo Casino (Nogales, Sonora); (9) Skampa Casino (Ensenada, Baja California); and (10) Skampa Casino (Villahermosa, Tabasco) (collectively, the “Gambling Establishments”)  <SU>12</S ━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━━ Preview showing 10k of 107k characters. 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