An allegation that the BC Lottery Corporation’s former compliance manager asked staff to loosen up on anti-money laundering rules was not substantiated in an investigation, B.C.’s money laundering inquiry heard.
Cary Skrine, executive director of investigations for the B.C. Gaming Policy Enforcement Branch, testified at the Cullen Commission on Wednesday that he investigated a complaint into Lottery Corp. compliance director Robert Kroeker in 2019.
The complaint alleged that Kroeker had directed his anti-money laundering team to “loosen rules” around scrutiny of casino cash transactions, the inquiry heard.
Skrine said that former Lottery Corp. anti-money laundering investigator Ross Alderson alleged that Kroeker made the comments to Alderson and two other staff.
Alderson told Skrine the other two staff had expressed concerns to him about Kroeker’s alleged comments, Skrine told the inquiry. And that Alderson told Skrine he asked the pair to record their thoughts on the meeting.
However, Skrine said the pair did not take independent notes of the meeting. And Kroeker’s alleged comments were not recorded in meeting minutes.
And in interviews, the pair both vehemently denied that Kroeker had made the comments attributed to him by Alderson, Skrine said.
Kroeker left the corporation in 2019 for undisclosed reasons that have nothing to do with his compliance role, Kroeker testified this week.
The inquiry has already heard that Asian-organized crime used loan sharks especially at River Rock Casino in Richmond to provide “VIP” high-rollers from China with suspected drug cash to buy casino chips. And investigators believed the VIPs would often pay the gangs back in China.
But the inquiry heard Wednesday that the enforcement branch also had serious concerns about bank drafts being used to launder money in Lottery Corp. casinos.
Skrine testified that the “vulnerability” occurred because bank drafts could be deposited into casino accounts anonymously. This raised concerns that gamblers were using funds provided to them by gangsters with access to bank accounts.
Skrine testified that he and Kroeker discussed these concerns in 2019, and Skrine was “puzzled” that Kroeker didn’t accept that bank drafts were a vulnerability for Lotter Corp. casinos, when police and bankers had “accepted the fact.”
“(Kroeker) shared information about countless reviews where no abnormalities were found (in bank drafts accepted by casinos),” Skrine said.
According to Skrine, since 2018 — when B.C.’s government brought in rules requiring gamblers to declare their source of funds — suspicious transactions have dropped significantly in Lottery Corp. casinos.
The inquiry continues this week.