Monday, April 14, 2014

Money laundering and casinos, who knew?

CTV Vancouver: Money laundering rampant in casinos, April 10, 2014
"Confidential documents are shedding light on a host of suspicious behaviour at B.C. casinos, where patrons routinely carry bags loaded with small bills onto the gaming floor.

"Government reports obtained by CTV News highlight dozens of instances of suspected money laundering and loan sharking, most at the River Rock Casino in Richmond. And the problem only appears to be growing..."
Link to Video
Unforseen events occasionally damage properties and injure people and no preventative actions were possible. Last year's Chelyabinsk meteor in Russia was an example.

In other circumstances, misfortune might have been prevented but financial factors intervened. Recently, GM chose not to replace a faulty ignition switch because doing so would cost millions. People died. In the seventies, Ford coldly calculated that the cost of a Pinto recall and repair was greater than the value of lives that might be lost. Although British Columbia is an earthquake hazard area, the province does not prioritize preparedness.

It is not unusual for the right course of action to be avoided because it brings with it a financial cost. It may not be right, but it is human nature. Clearly, the government of British Columbia has always been aware of criminal activities such as loan sharking and money laundering in gambling estabishments. However, crime prevention would cost money for effective policing and, more importantly, it would reduce gaming revenues and lead to closures in an industry overbuilt by influential people.

By 2009, BC Liberals had decided that blind eyes were more profitable than diligence when it came to supervision of gambling. They know there are costs in terms of lives ruined and families destroyed but, there are financial benefits to be had. Every now and then, police will complain or a story will appear in the media but politicians are well practiced at promising things will soon change. After reassuring words, everything goes back to normal. Nothing changes and the weak continue as victims.

My supposition is that BC's illegal drug trade is so large that government wants a share and the easiest way to gain it is to skim a share from the extensive money laundering done through casinos.

A short spin through news archives proves authorities have long known that illegal activites are endemic in licensed gaming faciities. Many more examples could be shown:

Tearing the cover off `victimless' crime, David Baines, Vancouver Sun, October 19, 2000
"RCMP Insp. Kim Clark, head of the Vancouver Integrated Proceeds of Crime section, doesn't share the popular view that money laundering is a non-violent, victimless crime. He draws a straight line from the ruthless world of drug dealing to the more urbane, white-collar business of laundering the proceeds.

" 'We have 20-odd unsolved murders in the Lower Mainland related to drug dealing,' he said Wednesday.

" 'There is a direct nexus between drug dealing and violence, and its spinoff, money-laundering. It's looked on as victimless crime, but that's not true at all.' "
How money is laundered, Neal Hall, Vancouver Sun, December 31, 2003
" 'I can say that in general, the spread of organized crime just in the past two years has been like a cancer on the social and economic well-being of all British Columbians,' RCMP Sergeant John Ward said.

" 'Today, the value of the illegal marijuana trade alone is estimated to be worth in excess of $6 billion. We are seeing major increases in organized crime-related murders, beatings, extortion, money laundering, and other activity which touches many innocent lives.'

"Drug trafficking generates huge amounts of cash for organized crime, which "launders" illegal profits to avoid prosecution, increase wealth and evade taxes, according to an RCMP report on money laundering..."
Casino loan sharks draw 300 complaints, no charges laundering, Chad Skelton, Vancouver Sun, August 18, 2006
"The provincial agency that investigates crime in B.C. casinos has failed to have a single person charged with loan sharking or money laundering despite receiving more than 300 complaints of such activity over the past two years alone, enforcement statistics indicate."
Gambling enforcement branch no match for the criminals casinos attract, Paul Willcocks, Vancouver Sun, October 23, 2006
"Forget about criminal activity on the streets. The real crime explosion is around B.C. casinos and "gaming centres," where investigations of serious offences like money-laundering and loansharking more than doubled last year.

"The province's Gaming Policy and Enforcement Branch reports it launched 3,414 investigations last year, up 36 per cent from the year before. The number of investigations launched into activities linked to organized crime -- like money-laundering and loansharking more than doubled, to 235 cases.

"Organized criminals like casinos because they offer so many opportunities..."
Money launderers suspected of using casino slots to wash cash; Suspicious currency transactions not reported, Neal Hall, Vancouver Sun, May 22, 2008
"B.C. Solicitor-General John van Dongen is concerned about reports that criminals may be using casinos to launder cash through slot machines and claiming the money as legitimate "winnings."

" 'It concerns me a great deal,' he said in an interview Wednesday"
B.C. too soft on illegal gaming: ex-chief, Sean Holman, Kamloops Daily News, October 21, 2009
"The former commander of B.C.'s now-defunct integrated illegal gaming enforcement team is questioning the provincial government's commitment to "meaningful" illegal gaming investigations.

"Fred Pinnock also described the RCMP's senior management in B.C. as demonstrating "wilful blindness" when it comes to the connection between illegal gaming and organized crime.

"And he said his provincially funded RCMP team should have been expanded, not shut down..."
B.C. Lottery Corp. the only one in Canada to be fined; Casinos across country are lax on money-laundering rules, Kim Bolan, Vancouver Sun, July 22, 2010
"B.C. Lottery Corp. is the only provincial gambling commission to be fined for failing to report suspicious or large transactions at casinos, an official with the federal regulator said Wednesday.

"Blaine Harvey, of the Financial Transactions and Reports Analysis Centre of Canada (Fintrac), would not comment on the $670,000 in penalties imposed on BCLC for more than 1,000 violations under the federal Proceeds of Crime Act. "But Harvey did confirm that Fintrac has not penalized any other gambling commission.

"...A Fintrac review last November identified a number of ways criminals were abusing casinos to launder money. They included buying large numbers of chips and cashing them out almost immediately, and offering winning gamblers a premium for their casino cheques or their chips and using them as currency in criminal activities..."
B.C. warned of organized crime's reach into gambling, Sean Holman, Globe and Mail, August 23, 2012
"An RCMP team targeting illegal gambling in British Columbia wrote a report more than a year ago warning that organized crime figures were likely involved in those activities. Three months later, the investigative unit that was funded by the provincial government was shut down.

"But a separate internal report the unit prepared in December of 2007 evaluating its future stated that high-level illegal gambling targets would conduct their operations with "impunity" if the team were disbanded..."
Province to review cash transaction rules amid laundering allegations; RCMP concerned about suspicious money movement, Andrea Woo, Vancouver Sun, January 8, 2011
"Amid RCMP claims that B.C. casinos are being used for money laundering, Solicitor-General Rich Coleman announced Friday the government will review how large cash transactions are regulated. Coleman, the minister in charge of gaming, will consult with agencies including the B.C. Lottery Corporation, the gaming policy and enforcement branch (GPEB), police and other stakeholders.

"...Insp. Barry Baxter, head of the B.C. RCMP's proceeds-of-crime section, said his investigators began to notice a few months ago that dozens of casino transactions they believe should have been flagged as suspicious were in fact only reported as large."
BCLC not complying with transaction reporting rules: audit, Jeff Lee, Vancouver Sun, September 13, 2013
" The B.C. Lottery Corporation has been under-reporting large cash transactions at its casinos that it is obligated to report to Canada's money-laundering and antiterrorism financing watchdog, according to a provincial audit.

"The audit says that for the last three years BCLC has not complied with rules issued by the Financial Transactions and Reports Analysis Centre of Canada (Fintrac)..."

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7 comments:

  1. I seem to recall that the BCLC reports transactions over $10,000 (as required) to FINTRAC about 50,000 times a year. "Average" slot players? I don't think so.

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    1. In September 2013, Jeff Lee of the Vancouver Sun reported in BCLC not complying with casino transaction reporting rules, audit says:

      "The B.C. Lottery Corporation has been under-reporting large cash transactions at its casinos that it is obligated to report to Canada’s money-laundering and anti-terrorism financing watchdog, according to a provincial audit.

      "The audit says that for the last three years BCLC has not complied with rules issued by the Financial Transactions and Reports Analysis Centre of Canada (Fintrac) that require reporting of smaller but repeat transactions that cumulatively make up more than the $10,000 threshold for reporting..."

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  2. The entire BC Gambling situation is designed for drug money laundering. The casino's drug money can be cleaned very easily, load up a slot machine with bills, play a few games, take the game chit and viola, convert it to clean money. The same works in pubs with the Keno machines, load up the machine with cash, receive a game chit and get your money cleaned very easily. I once saw a chap load at least $5,000 in a keno machine play a few games and took the chit without ordering a beer. I commented to the barkeep and she told me he comes in every day, buys a coffee and plays keno and he is very lucky.

    All our gambling infrastructure has been so designed to ease the cleaning of drug money in the province and those who are willfully blind to this are just part of the problem.

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  3. Obviously this social disease is progressing. But addiction's an affliction, right? I recall cold turkey chill in Albetar when the Conservatives (that's what government's called there), despite a virtual epidemic of Video Lottery Terminal addiction among users was, for a time, tolerated by the Conservatives whose government was as addicted itself to VLT revenues. Just like interventions, there has to be a way to climb back down off of this abuse. A monkey's one thing---but a monkey AND and government?

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    1. C'mon, at the bottom of every lotto ad there's the slogan "Know your limit, play within it." That catchy little phrase has got to be more than enough to curb the urges of a chronic gambling addict who's destroyed his life and the lives of those close to him. The government has done its due diligence...

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  4. For anyone who is interested, there is a great book I read a few years ago, "The Road to Hell: How the Biker Gangs are Conquering Canada". Available on Amazon, of course. But it chronicles crime as it moved and moves across Canada. The chapter titled "BC Bonanza says so much! It's worth the read, even if only to see the names of many individuals and politicians we have come to know (and for the most part despise!)

    Then there is the level well above Hell's Angels and the like, the level that uses bikers as handservents.

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  5. Come on now. They hve to launder their money somewhere. How else are they going to "convert" their money to be used for "legal" things. No wonder Rich Coleman wanted another casino. You gotta love those lieberals. They actually make "organized" crime look good. Yes the lieberals certainly won't support children, their health care or their education, but they sure like to help all those crooks "laundering" their money. Makes you wonder

    ReplyDelete

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