Liberals, lotteries need to face hide gambling and crime links -- Paul Willcocks

Sometimes you have to call people on the rubbish they speak. The B.C. Lottery Corp. scandal is one of those times.
Start with Michael Graydon, the $300,000-a-year CEO. After the news broke that the Crown corporation had been fined $670,000 under federal laws aimed at combating money laundering and terrorism financing, Graydon denied any real problem.
Nothing to see here, he said on Global TV. The fines were levied because B.C. Lottery filed reports late because of computer problems and others had minor technical errors.
That wasn't true. B.C. Lottery was fined for 1,020 infractions. About 40 per cent were for late filing - but 366 reports had errors and 227 lacked accurate information to detect criminal activity.
In eight cases, the most basic information wasn't collected when people walked out of casinos with more than $10,000. They were asked to come back with the information, a trusting approach by those charged with preventing money laundering.
B.C. Lottery was also fined for failing to introduce a program to help identify signs of money laundering.
Solicitor General Mike de Jong said he's worried about organized crime, casinos and online betting. "If some of these early reports are true, yes, it is troubling," he said.
But it's not de Jong's file. Housing Minister Rich Coleman is responsible both for increasing gambling revenue and enforcing the laws. That conflict should be ended immediately.
And if de Jong is only troubled now, he hasn't been paying attention to a string of warnings about criminal activity. The government's Gaming Policy and Enforcement Branch 2006 annual report, for example, revealed a crime explosion at casinos and mini-casinos. Investigations into offences such as money laundering and loan sharking more than doubled in a year.
Criminals like casinos. They are good places to move counterfeit money and launder the proceeds of crime. Buy $9,000 worth of chips with cash from a drug deal, make a few safe bets and leave with a casino cheque that legitimizes the money.
And desperate gamblers are good customers for loan sharks.
In 2008-9, the gaming enforcement branch launched 877 investigations into suspected counterfeiting, money laundering and loan sharking. Not a single charge was laid.
Despite the crime surge, the government last year shut down the specialized police unit created in 2004 to help fight gambling-related crime.
Coleman was next to weigh in, with a response much like Graydon's. Technical errors, minor problems, old news, the province will appeal, de Jong and everyone else who has concerns are wrong.
But the agency that levied the fines - the federal Financial Transactions and Reports Analysis Centre, or FINTRAC - said that was untrue.
Fines are only imposed for a "persistent, chronic failure to comply with the law" and when, despite intensive work with the offender, "they just don't get it." The agency had warned B.C. Lottery about problems with its anti-crime efforts in 2008.
These are serious failures. About one-fifth of the money laundering and terrorism financing cases discovered in 2008-9 took place in casinos, FINTRAC reports. Drug dealers and organized crime are the main groups using casinos to launder money.
Yet Coleman and Graydon persist in denying a real problem that almost everyone else - including the solicitor general - acknowledges.
Again, that's because they are in a conflict. Both are charged with increasing the number of gamblers in the province, the amount each one loses and the total take.
Making the effort to track transactions that could be linked to money laundering is a threat to those goals. Casinos fear that asking for information from big gamblers could drive away some of their best customers, who, for whatever reason, want to keep a low profile.
Critics have warned the Liberals have lost their way on gambling. Denying a serious problem in fighting money laundering by big-time criminals shows how far they have fallen.
Footnote: Coleman also insisted it is just a coincidence that the weekly loss limit for online gambling was increased from $120 last year to $9,999 - just $1 below the level that would require reporting transactions to FINTRAC to help prevent money laundering or activities aimed at funding terrorism. The claim is not credible.

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Imagine, this is a legitimate, government sanctioned and indeed, government run operation. What happened to British Columbia - The Best Place on Earth?

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A tale of two bureaucracies.

Washington leaves Campbell red-faced

By Les Leyne, Times Colonist June 3, 2010

On Jan. 4, the NDP opposition submitted two identical freedom of information requests. One went to the state of Washington, one went to the province of B.C.

The request was for records relating to joint cabinet meetings held a few months earlier, led by Gov. Christine Gregoire and Premier Gordon Campbell.

The B.C. government issued a fairly detailed news release after the October meeting headlined "B.C., Washington State Partner on Cross-Border Opportunities."

But the NDP was curious about the framework and some of the intricacies of the various policies discussed.

On Feb. 3, the New Democrats got a note back from Gregoire's office. It offered all the requested documents for a grand sum of $63.60.

The NDP paid the bill and on March 3, two months after filing the request, it got 300 pages of documentation from the state government.

The striking thing, for a B.C. observer, is that not a single page has been whited-out or censored.

The 10-centimetre stack of documents contain everything you'd want to know about the work that went into discussing Olympic readiness, climate-change initiatives, border issues, H1N1 plans and more.

There are e-mails, minutes of meetings and "confidential drafts for discussion purposes only."

The governor's response even includes the expenses of the state officials who worked on meetings leading up to the joint cabinet session.

What did the Opposition get from B.C. officials when they submitted exactly the same request?

Absolutely nothing.

Campbell's office sent a note to the New Democrats on Feb. 11 asking for an extension until the end of March before responding.

NDP Leader Carole James told the legislature, "Well, here we are today [June 1] and we still haven't seen any document."

The premier is now two months past his extension to the original response deadline.

James asked him to explain why he's incapable of producing records in a timely manner, when Washington state handed them over in 60 days.

He didn't come up with much of an answer. "I will not make an assumption with regard to what has taken the time," he said. "I think it's important that we get the member back the information on why it has taken this time."

Then he volunteered that the laws are different. (They're different in the sense that Washington state's FOI laws work and ours don't.)

Weeks or months from now, the government will eventually comply with the request. Dozens of pages will be censored and the bill will be a lot higher than $63.60.

It doesn't much matter by now. The NDP has all the information.

The content itself isn't that important. (I flipped through the documents briefly yesterday and didn't find anything particularly newsworthy.)

But it's galling to have to knock on your neighbour's door to find out what's going on in your own house.

Because dozens of the e-mails are from B.C. officials involved in the meetings. At first glance, they are just the usual staff work you'd expect. Which makes the lengthy delay and the eventual unsatisfactory response, which is virtually guaranteed under B.C. law, all the more frustrating.

If they take this long to fail to produce completely innocuous records, what do they do with stuff that is genuinely controversial?

Campbell delivered a pro forma defence of B.C.'s unsatisfactory FOI system. But it didn't sound like his heart was in it.

He complained that every request costs taxpayers roughly $2,200 and that the average response winds up involving about 500 pages. So the process costs millions of dollars a year, he said.

Even while spending that money, B.C. still came dead last in a Canadian Newspaper Association cross-Canada audit of compliance last month.

A lot of priorities have shifted over the years. But nothing has fallen further down the list than the Liberals' original commitment to open government.

In the mean time, anyone interested in the inside scoop on what B.C. officials are doing is advised to wait until they consult with Washington state. Then ask the governor.

lleyne@tc.canwest.com
© Copyright (c) The Victoria Times Colonist

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