With money laundering through casinos a red-hot topic in Canada recently, Ontario’s gaming regulator handed out a substantial fine to a casino in the province.
Last Wednesday, the Alcohol and Gaming Commission of Canada issued monetary penalties totaling $227,250 (CAD) to HR Ottawa LP, which is responsible for the day-to-day operations of the Ontario Lottery Gaming Corporation Slots at Rideau Carleton Raceway in Ottawa, for 36 violations stemming from an audit. HR Ottawa LP is owned by Hard Rock International.
The AGCO determined the venue failed to comply with the Registrar’s Standards for Gaming, prompting the stiff financial penalty.
Among the 36 violations identified by the AGCO’s audit, HR Ottawa LP is alleged to have:
Provided advertising and marketing materials to individuals who had self-excluded from gambling activities.
Repeatedly failed to implement, follow, and enforce required anti-money laundering policies and procedures.
Failed to address matters of concern identified by internal auditors in a timely manner.
Maintained a compliance oversight function that was not independent of the company’s operations, as is required.
Failed to sufficiently protect gaming systems and data from security vulnerabilities in accordance with established industry and technology good practices.
Not ensured that staff completed necessary training in important areas like anti-money laundering policies and procedures.
“The AGCO has the mandate and the responsibility to ensure casinos are operating with honesty, integrity, and in the public interest. These penalties are intended to drive the improvements needed at the Rideau Carleton Casino, and we will be carefully monitoring the casino’s activities to ensure these significant audit findings are addressed,” said AGCO CEO and Registrar Tom Mungham in the release.
HR Ottawa LP does have the right to appeal the findings of the audit.
Rideau Carleton Casino General Manager Helen MacMillan told CTV News Ottawa that the “majority of issues” related to the audit have been “aggressively corrected.”
Rideau Carleton Casino is Ottawa’s only casino and has more than 1,200 slot machines and electronic table games in addition to live horse racing.
Other AGCO fines and Canadian money laundering issues
There appears to be an aggressive crackdown on money laundering issues in Canada after the province of British Columbia released an 1,800-page report in June that confirmed an “astounding amount of dirty money” was laundered through B.C. casinos between 2008 and 2018.
Commissioner Austin Cullen made 101 recommendations as part of the report, which found the Royal Canadian Mounted Police, the British Columbia Lottery Corporation, local government officials, and FINTRAC — the national financial intelligence agency of Canada — were all to blame for the money laundering issues in the provincial casinos.
Big takeaways: 1. Commissioner Cullen found that Fintrac’s reporting regime is essentially wasteful and the
“RCMP’s lack of attention has allowed for the unchecked growth of money laundering since at least 2012″ in BC.
— Sam Cooper (@scoopercooper) June 15, 2022
In an email release, the Canadian Gaming Association, a national trade organization that represents leading operators and suppliers in Canada’s gaming, sports betting, esports, and lottery industries, thanked Cullen for his extensive report and recommendations, and reiterated the organization’s commitment to “rigorous regulatory oversight” moving forward.
“The Canadian gaming industry is committed to working with all stakeholders and policy makers at the federal and provincial levels of government to continue to enhance our comprehensive and effective AML regime in Canada, leverage advances in technology, and utilize payment technology to provide a safe playing environment.”
A few weeks later, the RCMP uncovered another money laundering scheme in Toronto- and Niagara-area casinos. Police laid multiple criminal charges against five individuals after the four-year investigation concluded more than $3 million (CAD) from the illegal sale of cannabis was laundered.
The Alcohol and Gaming Commission of Ontario’s Integrated OPP Bureau Assists RCMP’s Money Laundering Investigation: https://t.co/35ulavQk7F pic.twitter.com/Fmu4Ns77FW
— AGCO (@Ont_AGCO) July 5, 2022
The AGCO has also been busy fining online gaming operators since the launch of the regulated iGaming and sports betting market on April 4. BetMGM, PointsBet, and DraftKings were fined by the regulator for violations surrounding advertising and inducements.