British Columbia

Former B.C. premier says government didn't alert her to rise in money laundering until 2015

Former premier Christy Clark told a provincial inquiry on Tuesday that she wasn't alerted by her government to a massive spike in suspicious cash entering B.C.'s casinos until 2015, despite the problem having reportedly been "apparent" by then for at least four years.

Christy Clark defends 'significant' work on file in testimony to Cullen Commission

Christy Clark, shown in 2016, is the first of several present and past politicians to appear this month before the Cullen Commission, which is investigating the causes and impact of B.C.'s money-laundering problem over the past decade. Clark was B.C.'s premier from 2011 to 2017. (Darryl Dyck/The Canadian Press)

Former B.C. premier Christy Clark told a provincial inquiry on Tuesday that she wasn't alerted by her government to a spike in suspicious cash entering casinos until 2015, despite the problem having reportedly been "apparent" by then for at least four years.

Clark told the Cullen Commission she was concerned that B.C.'s money-laundering crisis was "apparently at an all-time high" when it came to her desk, but said the province believed it was seeing more reports of suspicious activity because the government had ordered better training for staff monitoring casinos.

"There's a lot of downside in hearing that there's a spike in suspicious activity, but there was also a sense that, 'Alright, some of the changes that government's made have been effective,'" she said.

Clark, who was Liberal premier from 2011 to 2017, was the first of several present and past politicians to appear this month before the commission, which is investigating the causes and impact of British Columbia's money-laundering problem over the past decade and a half.

The complex issue, which has links to organized crime, distorted the provincial economy for years. It has also been connected to the ongoing opioid crisis and skyrocketing housing prices across the Lower Mainland.

Clark defends government action

Clark spent the majority of her testimony playing defence, standing by her government's response to the crisis during her first term.

She said the concerns raised in 2015 by Mike de Jong, who was then the minister responsible for gaming, led to the creation of the Joint Illegal Gaming Investigation Team (JIGIT) — a division of B.C.'s anti-gang police agency.

But a lawyer for the commission pressed Clark about why the task force wasn't created back in 2011, when it was a key recommendation in a report that year on the issue of money laundering.

"It wasn't a delay," Clark said.

Clark, second from left, is flanked by then-energy and mines minister Rich Coleman, left, and then-finance minister Mike de Jong on budget day at the B.C. Legislature in Victoria on Feb. 16, 2016. (Chad Hipolito/The Canadian Press)

"Funding for any priority in government can be found reasonably quickly where there's a will. In this case, as soon as that report of suspicious activity [spiking in 2015] reached the minister's [de Jong's] desk, he was wilful to make sure that [JIGIT] got done."

The Cullen Commission had previously heard allegations that political leaders weren't willing to crack down on the problem sooner, as it brought in significant gaming revenue for the province.

But Clark insisted that was not the case.

"Never did we say that revenue considerations would come before stopping criminal activity," she said.

Patrick McGowan, a lawyer with the commission, asked Clark whether she was aware that between 2012 and 2015, large cash buy-ins at casinos consisting mostly of $20 bills had become commonplace in the Lower Mainland.

Clark said she was not, but her government was taking various anti-money-laundering actions at the time, including restricting the exchange of small bills for large bills and transitioning to electronic fund transfers in casinos.

"I wasn't being kept abreast of the large cash buy-ins and the reports from law enforcement specifically,'' she said, adding she assumed that police would act on any reports of suspicious transactions.

McGowan asked Clark whether she would have acted had she known the scope of the problem.

A bag of cash is seen on surveillance video at Starlight Casino in New Westminster, B.C. The photo was released with the Peter German report into money-laundering in 2018. (B.C. Government )

"If you'd been told that somebody was dropping off a shopping bag at midnight containing $200,000 in $20 bills and that was then being accepted by [a casino] ... would you have intervened?" he asked.

"I can't answer questions about what might have happened, but I can say that we took significant action in the years that I was [in office]," Clark said.

As for money laundering outside of casinos, Clark said that "no one ever suggested" the criminal activity played a role in the housing crisis.

Instead, she said, cabinet believed astronomical real estate prices were a result of B.C.'s "strong economy," job growth, low interest rates and the fact it's "a beautiful place to live."

WATCH | Documents obtained by CBC News in 2011 showed senior RCMP investigators warned then-solicitor general Rich Coleman about money laundering in B.C. casinos:

B.C. casino warnings

BC

10 years ago
3:19
Top-level RCMP officials had warned the solicitor general's office about money laundering at B.C. casinos, the CBC's Eric Rankin reports 3:19

Problems started before Clark premiership, witnesses say

Former B.C. Liberal cabinet ministers Rich Coleman, Mike de Jong and Kash Heed are also set to testify later this month, along with Shirley Bond, the party's interim leader, who served as Clark's public safety minister and attorney general.

Attorney General David Eby will also be testifying.

While Clark's appearance on Tuesday was the most high-profile before the commission to date, the inquiry has heard that the problem began before her time in the premier's office.

Investigators reported noticing more suspicious cash at casinos beyond loan-sharking activities in 2007. The problem reportedly grew as the 2010 Winter Olympics neared before hitting an "apex" in 2015.

A report in 2018 said a "collective systemic failure" had cleared the way for unwitting casinos to become "laundromats" for proceeds of crime since the early 2000s, with more than $100 million likely cleaned in B.C. in roughly a decade.

The province appointed B.C. Supreme Court Justice Austin Cullen in May 2019 to lead the public inquiry into the scope and impact of the issue.

The commission's final report is due Dec. 15.

With files from The Canadian Press and CBC's Jason Proctor

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