A CBC News investigation has discovered a rush of suspicious money totalling almost $27 million flowed through two B.C. casinos this spring.
Most of the mystery money that came in from mid-March to mid-June arrived in bundles of $20 bills — a common currency used to buy street drugs.
With cash transactions at casinos, the source of the money is unknown and there is the possibility that gangsters are using the system to launder dirty money: buying in, but not necessarily betting, and then cashing out the credit and claiming the income as winnings.
Three years ago, the B.C. government said it would move away from large cash transactions at casinos in a move to crack down on suspected money laundering, but critics say that clearly hasn't happened.
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Documents obtained through a Freedom of Information request show that in three months, $2.5 million in suspicious transactions occurred at New Westminster's Starlight Casino, and $24 million was flagged as suspicious at Richmond's River Rock Casino.
In some cases, people arrived with shopping bags and suitcases packed full of bills in $20 and $50 denominations.
One person brought in $800,000 in twenties. Another showed up one day with $1.1 million in cash.
In all, 500 reports of suspicious transactions were obtained through CBC News' information request. The documents show that most of the cases were red-flagged by casino security and the incidents filed with the province's Gaming Policy and Enforcement Branch, but police were almost never called in.
In 2011, documents obtained by CBC News showed that the same two casinos were part of suspicious transactions, but in a similar time period the total amount of flagged exchanges came to just $8 million.
Mike Farnworth, the NDP's finance critic, said the sum total of the incidents from just this spring shows the government's promises three years ago haven't yet made a difference.
"They haven't done, I think, any meaningful changes since that time and that shows by the FOI results that CBC has obtained," he said.
The province insists the switch to electronic cash transactions is ongoing, and the amount exchanged in traceable transactions is growing.
Full statement from B.C.'s Ministry of Finance, Oct. 16, 2014
These reports reflect the active monitoring and reporting by casinos of cash coming into their establishments. The information in these reports provides background for further investigation if required.
Casinos are required to identify and report any large cash transactions of $10,000 or more to BCLC which, under federal legislation, is then required to report to Financial Transactions and Reports Analysis Centre of Canada (FINTRAC).
The Gaming Control Act requires casinos to immediately notify Gaming Policy and Enforcement Branch (GPEB) of any conduct, activity, or incident that may be contrary to the Criminal Code, Gaming Control Act or Gaming Regulation. This includes suspicious currency transactions.
Cases where there are findings of suspected criminal activity are shared with the police of jurisdiction where appropriate. The authority to further investigate lies with the police.
Government launched an Anti-Money Laundering strategy in 2011 focused on reducing the use of cash, to minimize the opportunity for money laundering to take place through gaming facilities.
Improvements under this strategy include:
- Patron Gaming Fund accounts,
- the ability to electronically transfer money into those accounts through Canadian and US chartered banks,
- the ability to deposit bank drafts into Patron Gaming Fund accounts,
- buy-ins with cheques from Canadian casinos,
- internet transfers,
- customer convenience cheques,
- a "cheque hold" system for high-volume players, and
- debit withdrawals at the cash cage.
There has been significant progress in providing traceable cash alternatives.
The use of electronic transaction options such as Patron Gaming Funds accounts, debit and ATM transactions continues to grow. In the last six months of 2014, there were nearly 9,800 debit transactions at casinos for a total of $18,158,390. When this option was first introduced in 2012, there were only 50 transactions during the first six months.
Money laundering is an offence under the Criminal Code of Canada and it is the RCMP and/or the police of jurisdiction who are responsible for investigating and recommending criminal charges.
Questions concerning money laundering investigations and/or prosecutions should be directed to the RCMP and/or police of jurisdiction.