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Money laundering, illegal gaming the focus of new joint policing unit

By Contributor
April 12th, 2016

The Government of British Columbia and the Province’s anti-gang agency are joining forces to form a co-ordinated investigation unit designed to crack down on illegal gaming and money-laundering in B.C.’s gaming facilities.

The formation of the new Joint Illegal Gaming Investigation Team was announced by B.C. Finance Minister Michael de Jong, Solicitor-General Mike Morris and Kevin Hackett, chief operating officer of the Combined Forces Special Enforcement Unit of B.C. (CFSEU-BC).

The new team will be located within CFSEU-BC, the Province’s anti-gang police agency and the largest integrated joint forces police unit in Canada.

“The objective of the Joint Illegal Gaming Investigative Team is to provide a dedicated, integrated, and coordinated multi-jurisdictional investigative and enforcement response to illegal gaming in B.C. with an emphasis on top-tier organized crime and gangs.”

The primary focus of the new Joint Illegal Gaming Investigation Team will be to disrupt organized crime and gang involvement in illegal gaming and prevent criminals from using B.C. gaming facilities to legalize the proceeds of crime,” said Kevin Hackett, chief operating officer of the Combined Forces Special Enforcement Unit of B.C. (CFSEU-BC).

“The joint team will also work to raise public awareness of the role service providers play in identifying and reporting illegal gaming and financial transactions.

The new joint investigation team will grow to become two operational teams consisting of 22 law enforcement personnel and four investigators from the Ministry of Finance’s Gaming Policy and Enforcement Branch. The team’s operations and governance will be overseen by senior police managers from the RCMP and municipal departments and chaired by the commanding officer of RCMP “E” division in B.C.

Funding for the unit will be shared between BC Lottery Corporation (70%) and the federal government through the Provincial Police Service Agreement (30%). Funding for the joint team is planned for five years, and the unit’s effectiveness will be reviewed by the Province and the CFSEU-BC governance board before the agreement is up for renewal.

The joint investigation team is a key part of Phase 3 of the B.C. government anti-money laundering strategy, launched in 2011. The strategy’s overall objective is to move the gaming industry away from cash transactions and scrutinize the remaining cash in an effort to isolate money-laundering from legitimate gaming.

Under this strategy, government has advanced and strengthened programs aimed at disrupting criminal activity, such as money laundering. Under the strategy, steps taken to date include:

  • Actively promoting the use of cash alternatives such as debit cards, convenience cheques and patron gaming fund accounts.
  • Requiring that casino chips only be used at a single facility and restricting the passing of chips on casino floors.
  • Placing tight restrictions on the ability of patrons to exchange small bills for large currency denominations.
  • Ensuring that any activities on the gaming floor or elsewhere on the property that raise concerns can result in a temporary ban while the concerns are investigated.
  • Enhancing the Province’s ability to analyse large and suspicious cash transactions that are being reported to the federal government’s financial tracking authority (FINTRAC) to help law enforcement identify issues.
  • Developing and implementing enhanced customer due diligence policies and practices constructed around financial industry standards.
  • Increased presence in gaming facilities by GPEB and BCLC staff who monitor activity and proactively work with law enforcement to prevent money laundering and the use of proceeds of crime.

Quick facts:

  • B.C. has had anti-money laundering policies in place since 1998.
  • In 2000, the federal government created FINTRAC, which requires businesses that deal in large sums of cash – banks, life insurance companies, real estate companies and casinos – to report large cash transactions and disbursements over $10,000, foreign exchanges over $3,000 and all “suspicious” transactions.
  • The provincial government commissioned a review of the Province’s anti-money laundering policies. Released in 2011, the Anti-Money Laundering Measures at B.C. Gaming Facilities review found the Province already has a progressive anti-money-laundering regime in place.
  • The review also contained recommendations to further strengthen this regime.  Government and BCLC have been developing and implementing strategies that address these recommendations. The strategy focuses on moving the industry away from cash transactions as quickly as possible, and scrutinizing the remaining cash for appropriate action in an effort to isolate money laundering from legitimate gaming, enabling enhanced enforcement action.
  • The AML strategy includes three phases:

    • Phase 1: the development and implementation of cash alternatives.
    • Phase 2: the promotion of cash alternatives by gaming facility patrons.
    • Phase 3:  regulatory guidance and as necessary intervention about potential additional measures for enhancing AML due diligence.

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