B.C.’s public inquiry into money laundering heard more testimony on how front-line casino regulators and investigators did not have – or did not think they had – the authority to stop bags of $20 bills from being cashed in by patrons.
This time, it was former Gaming Policy and Enforcement Branch (GPEB) manager of investigations Ken Ackles who said he couldn’t stop such suspicious, large cash buy-ins.
His testimony Monday at the Commission of Inquiry into Money Laundering in B.C. echoes assertions from several BC Lottery Corp. (BCLC) casino investigators and investigation managers, who said they were only tasked to “observe, record and report.”
Ackles said he understood his agency needed proof that six figures’ worth of $20 bills was proceeds of crime – and that is a matter for police to determine.
Ackles began working for GPEB in May 2013, after a 37-year career in the RCMP, the last portion of which was as a commander with the Richmond detachment. He said GPEB was “lagging behind” in addressing potential money laundering as “resources were diminishing” and positions were not being filled upon retirement. He added that between 2013 and 2015, GPEB investigators had no presence on casino floors.
Ackles said between 2013 and 2015, at least 70% of his time was spent packaging transaction reports from casinos to his supervisors. This, he said, was not a good use of his time.
Up until 2015, suspicious casino patrons were not being interviewed by anyone at GPEB and BCLC, said Ackles. His testimony also corroborated prior assertions by BCLC investigators that there was poor communication between GPEB and BCLC.
GPEB is the province’s equivalent of the Nevada Gaming Commission, in that it is mandated to set gambling rules and enforce them. BCLC is the government body that licenses casinos and other gaming venues.
BCLC also has a mandate to manage and promote gaming, and issues net gaming revenue to the provincial government. These funds are then dispersed to municipalities and community grant accounts, which are often used by politicians to make funding announcements.
While their regulatory mandates somewhat overlap, GPEB generally directs BCLC and has law enforcement powers and access to police databases.
Yet, despite access to police information, Ackles said he had no authority to stop a buy-in or even ban a patron who brought in a suspicious sum of money. Ackles added it was risky for GPEB investigators to interview patrons. He also said surveillance by GPEB of suspected money launderers outside of casinos was too complex and a task meant for the RCMP.
Ackles described no immediate, concrete steps taken to address money laundering concerns between 2013 and well into 2015. To date, Ackles said, he knows of no money laundering convictions stemming from GPEB and BCLC work. He alluded to a now-defunct investigation into alleged money launderer Paul King Jin, where charges were stayed against money service business Silver International Ltd. in 2018 on a technicality.
Furthermore, the commission, led by Justice Austin Cullen, heard how two GPEB casino investigations managers, Joe Schalk and Larry Vander Graaf, were terminated in late 2014 after raising related concerns to senior GPEB officials, who would have had direct communications with BC Liberal politicians.
To date, the commission has not heard from any senior executives at BCLC, GCGC or GPEB, or from any politicians during the time period being scrutinized.
The commission has focused on 2010-15, when gambling ramped up at new B.C. casinos. The commission has heard from lawyers for GPEB, BCLC and Great Canadian Gaming Corp., all of whom attempt to dissect the work of the other.
Meanwhile, lawyers for former BCLC executives Jim Lightbody, who has been CEO since 2014 but is now on leave, and Robert Kroeker, who was head of security and compliance between 2015 and 2019, have focused on failures before their clients’ time – between 2010 and 2015.
This three-week portion of the 18-month inquiry is looking at casino operations, but the commission is exploring other aspects of money laundering within the purview of B.C. government regulations, such as car sales and home sales etc. It is not, however, looking at federal banks.
The inquiry was first delayed for one week in October due to the provincial election. It has moved slowly since restaring on October 26, as witnesses get bumped back by days and each hearing day runs no longer than five hours. On Monday there was another delay stemming from administrative matters, such as admittance of affidavits. The daily hearings can be seen at CullenCommission.ca.