British Columbia Crack Down on Money Laundering in Casinos

Written by Geraldine 12 December 2017

Following a scandal that emerged in September, the Canadian government is allowing the BCLC more power in regulating and managing casinos. This will only affect British Columbia, however it is a significant step in the right direction for many involved. Although the scandal revolved around one particular BC casino, River Rock, the new legislation will affect all land casinos within the area. Find out more about the particulars of this case by reading the article below.


The story so far

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Last September, BC River Rock Casino was accused of routine money laundering by the federal government. This came following a damning publicly funded report originally carried out in 2016 – a report which was originally buried or ignored by the then provincial government. In fact, the report was only published on the 22nd of September 2017 by the Attorney General, David Eby. Eby was also made special investigator of the case, in charge of digging out why the report was buried in the first place.

The report took a general survey of the casino's finances between 2013-2015. It shows how players were permitted to make substantial cash buy-ins of over $500,000. This they could do even without providing any official documents tracing the history of said cash. Taking a snapshot look at July 2015 alone, River Rock accepted $13.5 million in $20 bills (a bill widely associated with its use in the drug world).

Legally speaking, casinos are required to report all cash transactions over $10,000. Despite this, River Rock filed just 1,194 of these reports of suspicious transactions – when in reality the amount should have been closer to 40,000. Given that this land casino is known for catering to Chinese high-roller VIPs, it is heavily implied that these businessmen are using the casino to launder their money from its criminal taint.


What's being done now

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Following the publication of the report in September, the provincial government of British Columbia declared the launch of a full-blown review of anti-money laundering (AML) policies in casinos. This will ensure that reports of this importance and scale will not be buried again. The former deputy commissioner of the RCMP (Royal Canadian Mounted Police), Peter German, was appointed to take care of this review which is due on March 2018.

Until that time, the BC government is requiring all casinos within the state to sign a new operational service agreement. This agreement will hopefully put a stop to any more scandals and money-laundering events until the review in 2018. The service agreement also gives more power to the BCLC (British Columbia Lottery Corporation) in both operations and enforcement.

According to CBC News, Eby commented,

“I’m very happy there is a new service agreement that is coming into place for B.C. casinos that will increase the ability of the B.C. Lottery Corporation, and by extension government, to enforce these policies.”

Casinos that sign up to the operational service agreement will receive a 5% facility investment commission as incentive. If the casinos fail to meet the requirements of the agreement, the BCLC retains the right and power to suspend payment of this commission.

BCLC President and CEO, Jim Lightbody, also stated that:

“The gambling market has evolved significantly since BCLC first took on the role of managing casinos in 1997,” continuing that, “The new OSA sets the course for the long-term success of the industry in B.C. by working with service providers to create and commit to an investment plan and hold service providers accountable for those plans and for maintaining the security and integrity of gambling.”