BCLC Finally Spills Beans Over FINTRAC Fine
The British Columbia Lottery Corporation (BCLC) has after a nearly a decade-long battle trying to keep secret the reasons behind the $700,000 fine it got slapped with by Canada’s anti-money laundering watchdog, finally come clean.
FINTRAC in 2010 slapped the Crown corporation with the largest penalty ever imposed against a provincial gaming corp. for having contravened Canada’s Proceeds of Crime (Money Laundering) and Terrorist Financing Act. The exact nature of those contraventions was however never made known to the public, and it soon became clear that the BCLC had every intention of keeping the facts of the matter a secret, and for as long as possible.
But this year saw a sudden turn in the road and what appeared to be a change of heart about the corporation’s willingness to embrace transparency. The Lottery corp. has now voluntarily offered up the information it fought tooth and nail to keep behind lock and key for more than 9 years.
Not A Pretty Picture
FINTRAC audits carried out in 2009 and 2010 paint a pretty gloomy picture of gross negligence and multiple oversights on the part of the BCLC. The eventual verdict was that the Crown corporation had failed to pick up on/investigate at least 7 high risk areas of deficiency found to have been prevalent in B.C.’s casinos during the mentioned 2-year period.
In order to ensure compliance with anti-money laundering laws, FINTRAC requires corporations and businesses to report any large and/or suspicious cash transactions attempting to pass though their doors. The mentioned audit however discovered that many of B.C.’s casinos were doing the exact opposite, which was to accommodate those transactions. Casinos were literally allowing high-rolling players to enter onto their premises with bags and suitcases stuffed to the point of overflowing with wads of $20 bills.
The high rollers in question were allowed to identify themselves as either self-employed or business owners, with no further investigations conducted or reports filed.
BCLC Begs For Secrecy
The BCLC’s President and CEO at the time, namely Michael Graydon, in a fax dated June 30, 2010, literally begged the financial watchdog to not only drop the massive fine but also to keep the corporation’s failures hidden from the public. It argued that publication of the facts of the matter would only alert criminals to weaknesses of the local casino industry and its regulator, which would then encourage even more illegal and/or inappropriate behaviour.
But according to freedom of information advocate Mike Larsen, Graydon’s argument was devoid of all substance, as no trade secrets pertaining to money laundering would at any point have been hanging in the balance. It was all along a matter of the BCLC having wanted to, for whatever reason, come across as having done nothing wrong.