Case Dismissed: Bloomberry Resorts Not Liable in $81M Bangladesh Bank Heist

Posted on: March 24, 2020, 12:03h. 

Last updated on: April 23, 2020, 08:36h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Bloomberry Resorts has been cleared in a lawsuit brought by Bangladesh Bank for the Philippine resort’s involvement in the 2016 international cyber heist thought to have been carried out by North Korean hackers.

Bloomberry Resorts Bangladesh Bank heist
A US federal judge says Bloomberry Resorts is not liable for its role in the 2016 cyber heist of Manhattan’s Federal Reserve Bank of New York. (Image: Federal Reserve Bank of New York)

New York Southern District Judge Lorna Schofield granted a motion to dismiss the lawsuit last Friday. Bangladesh Bank sued the casino and hospitality company on claims that it violated the Racketeer Influenced and Corrupt Organizations Act (RICO) of 1970, a US federal law designed to combat organized crime.

Along with Bloomberry Resorts, Bangladesh Bank named Rizal Commercial Banking Corporation (RCBC) among the other defendants.

In an opinion and order dated 20 March 2020, the United States District Court Southern District of New York granted defendants’ joint motion to dismiss for failure to state a RICO claim or RICO conspiracy claim,” a Bloomberry filing with the Philippine Stock Exchange explained.

The notice added, “The court further declined to exercise its supplemental jurisdiction over the remaining state law claims.”

Hollywood Scripted Real-Life Drama

It’s been roughly five years since US authorities say hackers in North Korea began a cybercrime plot that seemingly could have only been imagined in the mind of a Hollywood screenwriter.

Following North Korea’s hacking of Sony Pictures Entertainment’s computer system in 2015, the isolated country instructed its cybercriminals to carry out a similar attack on the Bangladesh Bank account at the Federal Reserve in New York City.

“In February 2016, North Korean hackers broke into the Bank’s computing system, issued false funds transfers and removed approximately $101 million from the Bank’s New York Fed Account,” Schofield summarized in her dismissal. “Eventually, $81 million dollars reached the Philippines, passing through bank accounts at Defendant RCBC and through casinos operated by Defendants Bloomberry and Eastern Hawaii (together, the ‘Casino Defendants’).”

It’s thought that the North Korean operatives used Bloomberry’s Solaire Resort and Casino in Manila, Philippines, to launder portions of the stolen funds. Investigators believe most of the money was transferred using bank account at RCBC.

The United Nations said last summer that casinos in Southeast Asia remain susceptible to money laundering. But Schofield ruled Bangladesh Bank’s lawsuit is dismissed because of “lack of subject matter jurisdiction” as it relates to RICO.

Bloomberry argues it’s a victim in the 2016 hacking and was not complicit in the theft. The company says “it had no knowledge that the funds used to purchase gaming chips and played in the gaming floor and in junket rooms in Solaire were stolen.”

COVID Support

Solaire is currently closed in Manila’s Entertainment City, as are all casinos in the Philippines capital, by the COVID-19 pandemic.

Along with revealing its Bangladesh lawsuit has been dismissed, Bloomberry Resorts announced Monday that it’s donating PHP60 million ($1.2 million) worth of protective health equipment, such as face masks, to the Philippines Department of Health. The donation is in response to the coronavirus pandemic.

In January, Bloomberry donated PHP25 million ($490,000) in relief goods to victims of the Taal Volcano.