Caesars Entertainment is pulling out of a $1 billion casino joint venture in Boston and said a subsidiary was subject to a federal grand jury investigation into money laundering.
Shares of the company, which operates the Caesars Palace and Flamingo casinos on the Las Vegas Strip, fell as much as 9 percent on Monday.
Caesars said it would withdraw its application for the casino venture with the operator of Boston's Suffolk Downs racetrack after investigators for the Massachusetts Gaming Commission raised concerns over its suitability for a state gaming license.
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In a regulatory filing on Monday, the company also said its Desert Palace subsidiary, which operates Caesars Palace, said it had received a letter from the financial crimes unit of the U.S. Department of the Treasury about "alleged violations of the Bank Secrecy Act."