Could New Internet Casino in Canada be Used for Money-Laundering?

British Columbia has just opened North America’s first-ever authorized Internet casino in North America to allow Internet casino gaming and already the province solicitor-general is concerned about potential abuse.  

Solicitor-general Mike de Jong publicly stated that he has been reviewing data provided by Canada’s Financial Transactions and Reports Analysis Centre (FINTRAC) on the British Columbia Lottery Corporation (BCLC). FINTRAC recently slapped BCLC with a whopping $670,000 fine, contending that BCLC had misfiled over 1,000 reports of $10,000 transactions at its land-based casinos. BCLC files about 50,000 reports per year.  

To de Jong, this means money laundering and/or terrorist financing may be involved – and each individual “misfiling” incident is a violation of Proceeds of Crime and Terrorist Financing Act, a bill that specifically addresses revenue earned through land-based casinos and online gambling sites in Canada. 

“If some of these early reports are true, yes, it is troubling,” de Jong said in part. “Gaming is legitimate activity. It is regulated heavily. We expect both those providing the gaming activities and those consumer and customers who use it to abide by the law.” 

BCLC CEO Michael Graydon confirmed the fine on Tuesday, stating that the violations were found by FINTRAC officials during a late 2009 audit of the gambling provider. Graydon went on to state that “improvements have been made” and that BCLC has been “error free since June 1.” 

The BCLC also underwent similar scrutiny in 2008, when more specific allegations about money laundering through casinos were made. And despite a fair bit of public outcry in 2009, the provincial government increased the limit that can be spent on Internet gambling in Canada from $120 per week to $9,999 – a rather convenient figure if one wished to avoid filing with FINTRAC.