Cullen Commission Hears Of $1.8M Cash Gamble
The Cullen Commission has heard how in December 2014, a VIP patron had, over the space of a single week hauled cash to the value of $1.8 million into British Columbia’s River Rock Casino & Resort – ready to be gambled. The bulk of the cash, so testified the former director of anti-money laundering and investigations for the British Columbia Lottery Corp. John Karlovcec, had arrived in $20 bills and smaller.
A cash transaction of this size and in this type of denomination would under most circumstances have triggered a cash security alert, and yet, the BCLC had allegedly failed to compel casino management to establish the source of the funds. When prompted to clarify why the B.C. Lottery Corp. failed to instruct the service provider to investigate the origins of the money, Karlovcec told Kaitlyn Chewka, lawyer for the province’s Gaming Policy and Enforcement Branch (GPEB), that instructing the casino operator to intervene and take action had not been within his (Karlovcec’s) authority.
Revenue Mattered Most
Chewka at the time of Karlovcec’s testimony before the commission referred to certain emails sent by the former anti-money laundering director, in which emails he had written about recognising the need to preserve revenue as opposed to jeopardising it. But even when presented with emails that clearly, he himself had sent, Karlovcec still insisted that he was never under any pressure from anyone to prioritise casino takings.
While Karlovcec conceded to the fact that a patron bringing onto the casino floor nearly two million dollars mostly in twenty dollar bills should have and would have been regarded as a suspicious transaction, he appeared confused when reminded by Chewka that the BCLC’s role in addressing suspicious cash transactions involved more than simply reporting red-flagged incidents.
Major Communication Breakdown
Karlovcec’s testimony also hinted once again at definite levels of friction between BCLC investigators, GPEB officials, local law enforcement (police), and River Rock management and staff.
The former BCLC director gave testimony about how his team had during that same year created profiles of at least 10 high-profile patrons suspected of loansharking. According to Karlovcec, said profiles were upon completion handed over to the anti-gang Combined Forces Special Enforcement Unit – for the opening of criminal investigations. According to his knowledge, alleged Karlovcec, said investigations were never formally opened. Continued Karlovcec, he suspects that the anti-gang unit had other tactical priorities at the time.
Karlovcec closed off his testimony by pointing out that the flow of information between the BCLC and the GPEB had been mostly inefficient.
The inquiry continues.