Stopping money laundering as simple as placing cop in casino

Suspicious transactions continue to be reported at casinos. - Black Press
Suspicious transactions continue to be reported at casinos.
— image credit: Black Press

If River Rock Casino Resort and the provincial government really wanted to stop money laundering in casinos, the solution is as simple as spelling RCMP.

Just place a Mountie in the all-seeing security surveillance room, decked out in dozens of TV screens peering through the seemingly ubiquitous domed cameras on casino ceilings, and instruct the officer to question a guest every time someone comes in with $10,000 or more in cash.

Garry Clement, president and CEO of Clement Advisory Group, and former director of the RCMP’s federal proceeds of crime program, told The Richmond Review if government wanted to take the issue seriously, it could also just stop accepting cash. Casinos already accept wire transfers, certified cheques and bank drafts, he noted.

Clement’s comments come in the wake of a CTV story, based on confidential documents it obtained highlighting the extent of suspicious behaviour in B.C. casinos, where gamblers “routinely carry bags loaded with small bills onto the gaming floor,” CTV’s Mi-Jung Lee reported.

“In one case from 2012, a ‘Mr. F’ walked into a casino’s VIP room with a backpack and bought in for $200,000 using all $20 bills,” CTV reported.

“He has an extensive history of suspicious transactions, according to the documents, and once brought in $1.6 million in a single month.”

Of the 1,013 suspicious transactions in 2013, none resulted in criminal charges, CTV reported.

“Accepting large amounts of cash is setting themselves up as a conduit for money laundering,” Clement said.

Asked if the province is “wilfully blind” to the existence of money laundering in B.C. casinos, Clement said: “Absolutely.”

Government shouldn’t be acting as a conduit for cleaning “ill-gotten gains,” because doing so means it’s in “possession of the proceeds of crime,” which makes it part of the problem, he said.

Word would spread quickly if every cash transaction were immediately scrutinized at the casino door. Clement guesses that casino revenues would drop 20 per cent.

Considering it’s a billion-dollar annual business in B.C., that makes this the $200-million question.

Richmond Mayor Malcolm Brodie said money laundering has always been a concern, something local police have on its radar.

Brodie said he voted against the expansion of gambling in Richmond, worried about the increase in crime, and the social cost of gambling.

“Money laundering is a very difficult issue to resolve, but they do what they can,” Brodie said.

But with the city recently reaping a record $18 million from its share of casino revenues, isn’t Brodie potentially biting the hand that feeds the city?

“I want a city that is crime free, and I would never want to condone or encourage criminal activity, whether or not it puts money in the city’s coffers.”

A source told The Richmond Review that for this policy to work, a police officer would have to be stationed at every casino in the province, around the clock. Otherwise the money launderers would just pick up their bags stuffed with 20s, and move to the next closest casino.

This surveillance room watches casino staff and gamblers extremely closely, to ensure there’s no theft or cheating.

If the casino were to stop the flow of suspicious cash, “that would end their business,” the source said.

The source added: “When was the last time you saw a uniformed police officer doing a routine patrol in the casino. It’s not a welcome place for police officers. They’re bad for business.”

Brodie said he will ask Richmond RCMP Supt. Rennie Nesset to come to an upcoming city hall meeting to discuss the money-laundering issue.

Brodie added that River Rock Casino Resort has been an incredible community business partner.

“They do a lot for our city. I know their attitude. They want a clean operation and they work very hard to keep it that way.”

River Rock spokesperson Chuck Keeling, a vice-president with Great Canadian Gaming, said the Richmond waterfront casino abides by money-laundering protocols followed by other institutions as well, including banks and realtors.

“We’re no different from a bank in terms of what is expected of us when we get large cash transactions,” Keeling said.

Whenever somebody brings $10,000 or more in cash, their personal information is collected, and then the information is reported to Canada’s anti-money laundering and anti-terrorist financing group FINTRAC, the Financial Transactions and Reports Analysis Centre of Canada, he said.

It was just a few years ago, he noted, when casino patrons were prohibited from using anything other than cash.

He said money laundering isn’t easy at casinos.

Cheques are only issued in two circumstances, he said, and are clearly labelled in the appropriate manner in each case.

If a customer’s win has been verified, they will only be issued a cheque in the amount confirmed by the casino, and it will be branded on its face: Players Gaming Club Winnings. Otherwise, the casino’s cheque will have printed on its face: “Return of Funds Not Gaming Winnings.”

Keeling added: “A casino will only issue a cheque for verified winning amounts where it can indeed verify that the funds are winnings generated at that particular casino.”

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