Wednesday, January 5, 2011

Want to launder money? Go to a casino

Hearing this one on Radio One this morning, I really wasn't surprised that casino money laundering it's happening in British Columbia.  It's been a problem at Ontario's casinos ever since we opened the first one -- now known as Caesar's Palace ™ Windsor -- in 1994.   Organized crime elements -- whether it's terrorists, drug traffickers, the mafia or just people working the "underground economy" (READ:  Black Market) launder ill gotten gains at gaming facilities (casinos or "slots at race tracks," turning dirty money into "clean" cash and don't have to report the winnings even if they are buying chips, say a hundred thousand at a time then cash them in just a few minutes later.

In one example, a guy from New Westminster bought $1.2 million in chips, quickly turned that back to cash (not a certified cheque, mind you, but cash) and boarded a plane to get out as quickly as he could ... but not before he got a letter from the casino confirming it was a jackpot payout so as to evade airport security.

Suspicious?   I certainly would be.

Under the anti-terrorism laws, any transaction over $10,000 -- or a combination of them in a 24 hour period -- must be reported to the feds.

But this is the weird thing:   In general, such unusually large transactions (if that's what it is) has trended down in nine of the ten provinces that have casinos, as it has in the Yukon (no casinos that I'm aware of in Nunavut or the NWT).   But in BC, it's tripled in the last year.

I'm sure the vast majority of high rollers, and even of the average Joe or Jane Blows, play money earned fairly.   But it doesn't hurt to ask some probing questions.   Some in some communities -- Native Canadian, South Asian, Middle Eastern -- may scream racial profiling.   Wrong.  This isn't about racial profiling, it's ensuring that ill gotten gains are seized and not returned.   It also wouldn't hurt to keep an eye on structuring -- whether it's done by individuals or groups -- so the spirit of the laws we have aren't violated.

I happen to believe that if some drugs as well as the sex trade was semi-legalized and taxed, then it would be a huge revenue generator and a lot of the really weird transactions would drop overnight.  It would also allow authorities to focus on those who go after our good nature and attempt to destroy a public trust.

The idea behind legalizing casinos and having them publicly run or under strict public regulation was to ensure people don't get taken for a ride.   And amazingly, we still are.  Hard to believe that even with all the money gaming facilities and lotteries make, and with set asides by law to treat "problem gamblers," some of the revenues can't be also set aside to ensure that everyone plays by the rules -- unless the crooks also happen to be the party in power's major financial contributors.   It's something worth thinking about.

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