Money laundering inquiry hears BCLC bowed to pressure from casino brass on investigations
The former head of the British Columbia Lottery Corporation’s Anti-Money Laundering Investigations and Intelligence Division says a senior BCLC vice-president once told him it wasn’t his job to investigate suspicious transactions at casinos.
In testimony before the Cullen Commission into money laundering activities in B.C.’s gaming, horse-racing and real estate industries, Ross Alderson, who served as a police officer in Australia before moving to Canada, said he was shocked at the amount of large cash transactions taking place at the River Rock Casino when he was first stationed there in 2011.
“There were buy-ins of up to half-a-million dollars during my tenure there. And some of those were in $100 bills,” he told the Commission on Thursday. “But, from my recollection, primarily $20 bills seemed to be the most common.”
Alderson recounted a story where he saw a customer use $20 bills bundled with elastic bands to purchase $100,000 in chips.
He said he the man did not gamble with the chips, and instead, a short time later attempted to cash them in for $100,000 in $100 bills.
The Commission heard the process of using a casino to convert significant amounts of cash in small bills to larger ones is known as refining.
Alderson testified that he approached casino staff and requested the man be paid back in $20 bills and not $100s.
“I had an argument with the general manager of the River Rock Casino in the investigator office,” he said. “He was quite angry and yelled at me that I had no authority to tell his staff what to do.”
Alderson went on to testify that he was then called into a meeting with Terry Towns, BCLC’s then VP of Corporate Security and Compliance.
“He referred to that particular file. He told me I wasn’t a cop anymore. He told us that we’re not to investigate. That our job was to detect and report only,” Alderson said. “He’d received a phone call from the casino and that they were upset with what had occurred.”
He then testified he had a further conversation about it with Gord Friesen, another BCLC executive.
“Do you recall what Mr. Friesen told you about his understanding of why the direction had been given?” asked Patrick McGowan, a lawyer for the Commission.
“Only that it was from pressures, financial pressure,” Alderson answered. “I believe his comment was ‘It’s about the revenue.’”
Alderson is one of the final witnesses to testify before the Commission which has been hearing testimony since February of 2020.
During an unrelated news conference Friday, B.C.'s attorney general declined to speak to specific testimony, saying he preferred to wait until the Commission had finished its work before weighing in.
“I think the public does want accountability for the decisions made by the previous government and we’ll do our best to provide that,” he said.
The Commission will hear from one more witness, an accountant from Ernst and Young, next week.
Closing submissions are scheduled for October and a final report from Commissioner Austin Cullen is expected before the end of the year.