Some staff at B.C. casino chose 'not to get' rules on suspicious transactions, inquiry hears
BCLC's former anti-money laundering director testifies at the Cullen Commission this week
There were suspicions at the B.C. Lottery Commission that some staff at the province's largest casino were choosing "not to get" Canadian regulations on suspicious transactions, B.C.'s public inquiry on money laundering has heard.
On Thursday, the Cullen Commission heard testimony from the BCLC's former director of anti-money laundering and investigations, John Karlovcec, about attempts to address problems at the River Rock Casino concerning the filing of suspicious transaction reports.
Those problems were laid out in a series of messages read out for the commission Thursday.
In a September 2011 email, former BCLC investigator Ross Alderson informed Karlovcec and others that the River Rock wasn't filing reports for any transactions under $50,000, noting a number of instances of players buying in just below that threshold.
"It's too much of a coincidence and the players must have been informed," Alderson wrote in the email.
The province's Gaming Policy and Enforcement Branch also raised concerns in emails from February 2012 about River Rock not submitting reports for transactions involving $100 bills, noting that the casino did not consider those bills to be suspicious.
In an email addressing those concerns, Karlovcec wrote that some people at the casino didn't seem to understand the rules, and "Some, I'm going to suggest, choose not to get it."
Asked Thursday to clarify whether he thought the oversight was deliberate, Karlovcec said, "I think there was some challenges with a few of their people," adding he believed those people worked in surveillance.
"There were some that had been in the gaming industry for so long … they didn't realize this was federal legislation and that reporting had to be completed as to the regulations," Karlovcec testified.
He said none of those issues were a result of training or advice provided by BCLC, and he believes the problems were addressed after he raised them with Great Canadian Gaming Corp., which operates the River Rock.
The Cullen Commission of Inquiry into Money Laundering in B.C. was launched by the government after reports that illegal cash was helping to fuel the real estate, luxury car and gambling sectors in the province.
BCLC has said it consistently reported suspicious transactions to Fintrac, Canada's financial transactions reporting centre, and pointed out unusual conduct to the province.
The lottery corporation has also brought in measures to control or prevent the flow of dirty money since 2012, including creating an anti-money laundering unit made up of certified investigators and intelligence analysts.
Great Canadian Gaming, which owns several gambling sites apart from the River Rock, has also defended the company's efforts to limit money laundering, telling the inquiry that criticism of the industry is unfounded.
Karlovcec's testimony continues on Friday.