B.C. Attorney General David Eby plans to have his ministry procure a second report on money laundering that will follow-up the bombshell study that it released Wednesday.
While the first report, Dirty Money, focused on how money is laundered in the province’s casinos, the second report will focus on the real estate industry, Eby told Business in Vancouver in a phone interview on June 28.
Former RCMP deputy commissioner Peter German, who wrote the 247-page first report, may be contracted to write the second report but that is not yet confirmed, Eby said. No timeline for the second report has yet been set.
“One of the troubling pieces to me is that the people who were walking the cash into the casinos, and had some sort of a connection to organized crime, often listed their occupation as being real-estate related,” Eby said. “If this is the money they’re gambling with, what is the money that they are using in the real estate industry, and where did it come from?”
Eby said that his ministry is working out details for the second report with Finance Minister Carole James, who is the party’s point person on matters related to real estate.
BIV in mid-2015 went on a tour of Great Canadian Gaming Corp.’s (TSX:GC) River Rock casino with several of the company’s representatives, including its now chief compliance officer and vice-president of legal, compliance and security, Rob Kroeker.
German’s report identified that casino as being the “epicentre” of casino-oriented money laundering in the province.
The 2015 tour of River Rock casino was arranged after BIV reported accusations from anti-gambling activist Sandy Garossino that high-rolling gamblers were coming from China and laundering money in Great Canadian Gaming facilities.
Great Canadian Gaming representatives strongly rejected those allegations and explained how corporate policies were designed to make money laundering impossible.
Kroeger, who was then the company’s vice-president of corporate security and compliance, showed BIV River Rock casino’s surveillance room and he pointed to cameras that would take photos of people who attempt any transaction deemed suspicious.
Similar such video was shown at the June 27 press conference, where German’s report was unveiled. That video showed people taking bricks of $20 bills out of duffel bags and providing them to a cashier
Great Canadian Gaming’s policy is to have clerks fill out large-cash-transaction reports for the federal overseer, Financial Transactions and Reports Analysis Centre of Canada (Fintrac), whenever the transaction is valued at more than $10,000.
If the gambler plays for just a short amount of time and then attempts to leave with a fresh cheque from Great Canadian Gaming, the cashier would fill out a separate suspicious-transaction report and file that with Fintrac, BIV was told in 2015.
Fintrac staff is then supposed to bundle together multiple examples of suspicious activity involving the same person, or people who appear to be the same person based on photos taken at casinos. Great Canadian Gaming also has a policy to stamp “not from winnings” on cheques given to people who cash out large sums of money if they also arrived at the casino with that money. That precaution was supposed to make it clear that the money had an unknown origin.
Eby told BIV on June 28 that he remembers going on a similar tour of River Rock casino years ago.
“I think all the forms were filled out,” he said. “The problem is that they just went into a box in a warehouse somewhere.”
Some of the recommendations from German's report on casinos were:
•to replace the British Columbia Lottery Corp. as the chief regulatory body for casinos in the province;
•to have the province lobby the federal government to enact new money-laundering laws and to better scrutinize industries that have historically been targeted by criminals, such as automobiles, luxury goods and real estate; and
•to have the province create a designated police unit for the gambling industry that would focus on Metro Vancouver.
Glen Korstrom / Business In Vancouver