Casino News

High-Value BCLC Cheques Raise False Money-Laundering Concerns

An investigation conducted by the Canadian Postmedia Network revealed most of the high-value cheques the British Columbia Lottery Corporation (BCLC) issued to its VIP patrons in 2016 did not result from their gambling winnings. The local media company’s examination tackled the way cheques were disbursed from the non-cash gaming fund accounts of patrons after a number of documents showed that the gambling policy enforcement department in British Columbia expressed concerns these accounts were funded predominantly via bank drafts that were linked to high-rollers from Asia.

According to the enforcement branch, this could prove to be problematic due to the fact casinos accept such payments without actually having a way to know whether the money is coming from the personal bank account of a given VIP patron. Some of the accepted bank drafts were in fact blank.

The local media company was granted access to the internal records of the British Columbia Lottery Corporation under the Access of Information Act, which enables citizens to request records from federal institutions. After the Postmedia examination of the records, it was revealed that Richmond’s River Rock Casino issued 21 of the largest patron withdrawal cheques in 2016, with their value ranging between CA$600,000 and CA$2.4 million.

There is a common practice among gambling operators to retain the cheques for a specific amount of time so that payments can be audited. The purpose of this is to prevent money laundering in the casinos regulated by the British Columbia Lottery Commission. All cheques which do not involve withdrawals of winnings are labelled as “return-of-funds” cheques.

VIP players were promoted to patron gaming accounts with the purpose of allowing for the easier tracking of the funds’ sources and preventing the account holders from laundering money. If a particular player deposits by using a bank draft and then request to withdraw via a cheque without actually having played at the casino, this should immediately raise a red flag and their withdrawal should be reviewed.

The BCLC could not find 5 of high-value cheques issued by its River Rock Casino Resort in Richmond. Among the 5 missing cheques was one that amounted to the hefty sum of CA$2.4 million. They asked the casino to obtain copies of the missing cheques from its banking institution. It became apparent 23 of the cheques were printed while the remaining 2 were filled in by hand.

Some of the Cheques Were Labelled “No Buy-In”

One handwritten cheque contained withdrawal to the amount of CA$600,000 while a note indicated the patron whom it belonged to had requested a withdrawal without actually buying in chips to play at the casino. The second handwritten cheque was to the amount of CA$1.72 million and was issued by River Rock Casino to a winning patron in October 2016. However, most of the remaining hefty cheques were issued to players who did not buy in chips at the casino.

The BCLC explained that many customers would use the patron gaming accounts to store their funds in while they are playing at a gaming establishment. If a given player ends their session and does not intend to return to the gambling venue, they can cash out the funds stored in these “holding accounts”, with their cheque being marked as “no buy-in”. It was established that none of the 25 high-value cheques looked suspicious.

Presently, there is only one instance in British Columbia where a patron gaming account has been linked to fraudulent activities and money laundering. The case in question has to do with a real-estate lawyer from Richmond by the name of Hong Guo.

The lawyer claimed two of her employees were detained by China police authorities because of the disappearance of $7.5 million from her company’s trust account. According to Guo, two former members of her staff stole the money from the trust account back in 2016. They allegedly used their patron gaming accounts to launder and transfer the sum to China.

The real-estate lawyer also claimed one of the employees by the name of Qian Pan used bank drafts to transfer the sum from her patron gaming account at Gateway Casinos to her personal bank account. A spokesperson of Gateway Casinos responded that the gambling operator’s transactions were reviewed by the BCLC at the time and were not considered suspicious.