A commission of Canada’s British Columbia has been probing money laundering and how the B.C. Lottery Corp. has dealt with it in a public inquiry that included testimony from a former executive of the lottery.
Robert Kroeker, who was fired as vice-president of corporate compliance in 2019, during his testimony described how the Crown corporation (a corporation owned by the Canadian government) investigated and dealt with illegal cash transactions at the casinos it is responsible for regulating.
Kroeker’s attorney questioned him: “You are not a floor manager. You are not on the business side of casinos. You are not wining and dining high rollers,” said the attorney. “That’s not what you do. You’ve spent your life in compliance and trying to deal with money laundering and making casinos secure places in B.C.”
Kroeker, a former Royal Canadian Mounted Police (RCMP) officer, talked about the impact that allegations that the lottery corporation did not act against illegal cash transactions at its casinos. In an emotional testimony he said, “It’s been devastating, not being able to respond, particularly when I was at the corporation, and especially for my team.” He added, “They’re professionals and to see them continually attacked and maligned, it’s really unfair.”
He was referring to previous allegations by another former Mountie and former gaming investigator Larry Vander Graaf who several months ago told the commission that B.C. Lottery Corp. was lax in fighting to protect the integrity of its casinos between 2007 and 2010. Large amounts of cash began circulating in B.C. casinos, he said, as alleged mobsters “laundered” money from loan sharking and drugs into untraceable cash.
Kroeker testified he received briefings and reviewed documents on these activities on his first day at the job in 2015. He said that by that time BCLC was aware of concerns of “the cash being brought into casinos being proceeds of crime,” as his attorney put it.
Money laundering in the province has been linked to rich Chinese visitors who often bring suitcases full of cash with them from China, which has strict laws preventing its citizens from taking money out of the country.
Kroeker helped created the province’s civil forfeiture office.
He also testified that B.C. Attorney General David Eby, who has for several years led very public efforts to fight money laundering, was initially “disinterested” in BCLC’s fight against it when he first heard about it in 2017, shortly after his party took power in the province.
He said, “He (Eby) seemed largely disinterested in it and at the conclusion of my explanation he looked down and he noted the author was Brad Rudnicki, who was our analyst, and he said to me, ‘What would a guy with a name like Rudnicki know about Chinese money laundering?’ ” said Kroeker.
His testimony caused the ministry to issue a short statement that “this government’s actions to tackle financial crime in B.C. speaks for itself.”
Eby in 2019 appointed a supreme court justice to lead the commission looking into money laundering after several reports were published detailing the effects of money laundering on casinos, the real estate market and luxury automobiles.
