After calling for a public inquiry into money laundering in British Columbia for many months, my BC Green Caucus colleagues and I were delighted with government’s announcement today that they will indeed launch such a public inquiry.

Below is the media release we sent out in support of government’s decision.

Media Release

B.C. Green Caucus Responds to Government’s Decision to Call for a Public Inquiry Into Money Laundering in British Columbia
For immediate release
May 15, 2019

VICTORIA, B.C. – The B.C. Green caucus has been calling for an independent public inquiry into the issue of money laundering in B.C. since February and supports government’s announcement today to establish a commission to begin that process.

“A public inquiry into money laundering in B.C. removes the investigation from partisan influence, protects the public interest and restores public trust,” said MLA Andrew Weaver, leader of the B.C. Green Party. “Our caucus supports this inquiry and stresses that it must be fully empowered under the Public Inquiry Act and without arbitrary limits imposed on the time period to be examined. This process must be transparent whenever possible throughout the proceedings, and the findings and recommendations must be released in a timely manner.

“The financial impact and human costs money laundering has had, and continues to have, on our province’s housing and opioid crises is staggering. British Columbians deserve no less than a full and complete account of how it was allowed to go on for so long and reach the scale that it did. They deserve knowledge of and accountability for the decisions made by individuals and regulatory agencies that contributed to the scale and severity of the impacts.”

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Media contact
Macon McGinley, Press Secretary
+1 250-882-6187 |macon.mcginley@leg.bc.ca

Today during question period I rose once more to ask about the issue of money laundering in British Columbia casinos. As you’ll see from the responses to my question, the Attorney General was quick to point fingers at the BC Liberal Member from Langley East.

Below I reproduce the video and text of our exchange.

Video of Exchange

Question

A. Weaver: I must say, it feels like I’m rising midway through an episode of the Twilight Zone here today in this Legislature. Frankly, while last night I was busy trying to prep up on the money laundering going on, it seems like far too many members of this chamber were enjoying casino night a little bit too much and probably are a little grumpy as they lost far too much money there last night.

Over the past eight months, we’ve learned that senior officials at the B.C. Lottery Corporation repeatedly demonstrated wilful blindness to the problem of money laundering in B.C. casinos. But now we know they went further. In fact, they went directly against the regulators’ recommendations and increased betting limits, per hand, to over 1,000 times the maximum betting amount allowed in Ontario. I’ll say that again — 1,000 times larger than you can bet in Ontario.

Now, I can only assume that senior officials and people perhaps in the minister’s or former minister’s office were blinded by the revenue stream. They appear to be singularly focused on hitting revenue targets and bringing in more government revenue with little, if any, concern as to whether the law was being broken or if it was fuelling an opioid or housing crisis.

My question to the Attorney General is this: what controls has he put in place within the B.C. Lottery Corporation to ensure that meeting revenue targets does not come at a price of condoning suspected illegal activity?

Answer

Hon. D. Eby: We’ve made a number of significant changes in the just over a year that we’ve been in government to address the issues that the member has been talking about. Some of the most important, I think, are around separating the revenue-generation functions, the revenue-generation piece at B.C. Lottery Corporation, from the regulator piece. Having those under the same roof is obviously an issue. So we have given the gaming policy and enforcement branch authority to regulate and oversee the B.C. Lottery Corporation. Giving them this authority and this power is a really important piece and something that was obviously missing. Why was the regulator not overseeing the conduct of the B.C. Lottery Corporation?

Beyond that, the member knows about basic things we’ve done — telling the casinos you’re not allowed to accept bulk cash anymore, that revolutionary idea that immediately ended the practice of bringing duffle bags full of cash into our casinos — after we formed government.

Now, I know the member for Langley East doesn’t like to hear about this. But he was there….

Interjection.

Mr. Speaker: Member.

Hon. D. Eby: If there is a public inquiry, he’ll have his chance.

Now, these are very serious issues. We’ve taken very serious steps. I thank the member for the serious question, and I wonder when the member for Langley East will rise and ask a question about this.

Mr. Speaker: Leader, Third Party, on a supplemental.

Supplementary Question

A. Weaver: We have no shortage of questions to ask on this file, and we will continue to do so until we start to get answers through the calling from public inquiry.

Here’s the next question. In February 2015, after finally contacting the RCMP organized crime unit about possible money laundering going on in their casinos, the CEO of the B.C. Lottery Corporation continued to strategically focus on attracting players willing to pay $100,000 per hand. When questioned about his decision, he said this: “We know them very well. We know their source of wealth. We know all their personal information. They need to share that with us for regulatory reasons.” That’s a quote from the CEO of the B.C. Lottery Corporation.

What we found out through the e-pirate investigation, is that it eventually became clear that these VIPs, the same ones that the CEO apparently knew so well, were part of an organized crime scheme linked to the fentanyl crisis. Yet the CEO Of the B.C. Lottery Corporation still is there.

My question is to the Attorney General. How can British Columbians have any confidence that those involved in perpetrating money laundering in B.C. are being held accountable for their actions, particularly given the reluctance of this government to launch an independent public inquiry?

Answer

Hon. D. Eby: The member knows why we have not yet called a public inquiry. That’s because we have been acting quickly to address the issues that the previous government left for us, the giant, gaping loopholes in our casino industry that allowed this activity to continue up until the point that we actually formed government.

Interjection.

Mr. Speaker: Member. Member, we will hear the response.

Hon. D. Eby: Now, I hear the member for Langley East saying that there’s an issue with the police. I would say there was an issue with the police when the member for Langley East called the RCMP to criticize a member for going on the news and saying we had a money-laundering problem and causing him to be disciplined. Now, that was a problem.

We’ve taken a number of steps to ensure….

Interjections.

Hon. D. Eby: He also disassembled the policing team that was dedicated to investigating casinos.

But regardless, we’ve replaced the board at B.C. Lottery Corp entirely. We have confidence in the team at B.C. Lottery Corp. to be a good partner in addressing these issues. We’ve given oversight to the gaming policy and enforcement branch to oversee what’s happening at the B.C. Lottery Corp. to ensure that the public can have confidence. And we’re all trying to move forward on this — well, with some notable exceptions.

Yesterday the Attorney General received the second Peter German report on the state of money laundering in British Columbia. In addition, the Minister of Finance received a report from the Expert Panel on Money Laundering. Both of these much awaited reports will provide information with which to inform a potential public inquiry into money laundering in BC.

This was the subject of my Question during Question Period today (see video and text reproduced below). As you will see from the responses, the government has stated that it will review the reports before they are eventually made public. A public inquiry is still being considered.

Video of Exchange

Question

A. Weaver: We learned last week that a controversial senior-level intervention was made by officials in the Finance Ministry in order to maximize casino revenue. Incredibly, the intervention to increase betting limits to $100,000 per hand, despite repeated warnings from the regulator, was deemed to be “in the public interest” by the former Minister of Finance.

Let me reiterate. Allowing $100,000 betting limits to be played at casinos, despite clear warning signs from the regulator, was deemed to be “in the public interest.” I don’t know how many of you have played blackjack or poker with $100,000 stakes. I’d suggest not an awful lot. Shocking, it is.

My question is to the Attorney General. Each week more and more information is brought to light. An ever-growing list of questions is emerging. Pressure for an independent public inquiry continues to grow. The federal Minister of Border Security and Organized Crime Reduction has indicated he is open to a request from the province for supporting an inquiry. He now has two special reports in front of him. Does he think he has enough evidence to call for a public inquiry?

Answer

Hon. D. Eby: Thank you to the member for the question. Yes, this is an important day. The Minister of Finance has received a report from her team, from Maureen Maloney, and has received Dr. German’s report, which, as the member knows, looks at issues around luxury cars, issues around horse racing and issues around real estate.

Dr. German’s report alone is more than 300 pages. We’ve just received it. We’ll be going through it to do a couple of things — to make sure that the public release doesn’t compromise any law enforcement investigations and doesn’t unfairly impugn the reputation of any individuals. Then we’ll be releasing it to the public. The reason for that is exactly the reason that the member has identified. The people deserve to know what’s been going on in British Columbia, what happened under the previous government and why we need to take the measures that we’re taking to get things under control.

They made a number of serious errors in judgment. We don’t know whether it was wilful blindness or negligence.

Interjections.

Mr. Speaker: Members.

Hon. D. Eby: The member who is shouting at me is one of the key members, obviously. I understand why he’s defensive about it, but the truth will out.

Mr. Speaker: The leader, Third Party, on a supplemental.

Supplementary Question

A. Weaver: Thank you to the Attorney General for his answer.

Last week the Attorney General said this: “The larger issue that I understand British Columbians are concerned about is really political accountability and to identify if there is rot in the system, to have that rot weeded out through a public inquiry system.” He’s absolutely correct. We need political accountability, which is why the B.C. Green caucus has been calling for an independent inquiry for over a month now. It’s why thousands upon thousands of people have signed petitions calling for one and why several organizations, municipalities and unions have also called for one.

Last week the Attorney General also said: “The Premier has been clear about keeping the option open to a public inquiry.”

My question is to the Attorney General. When will we know if government is serious about launching a public inquiry?

Answer

Hon. D. Eby: The member will know that our emphasis has been on identifying what’s been happening and on stopping that activity from continuing. That’s been the big priority. The member raises the issue of accountability, especially political accountability. I do think that’s a very important issue — not just for the member, not just for me and not just for the government but, certainly, for all British Columbians. We’ll be looking at the reports we’ve received, and the Premier and the government will make a decision about a public inquiry if necessary.

Below I reproduce my opinion piece on the need for a public inquiry into money laundering that was published in the Vancouver Sun today.

Vancouver Sun Letter

B.C. has been the victim of organized crime for more than a decade and at least two of our governments have known about money laundering operations. It is time for action on behalf of British Columbians.

In recent months, we have seen revelations that money laundering is extensive and pervasive in B.C. Last year, the G7’s Financial Action Task Force, which identifies threats to international order, reported that $1 billion a year is funnelled through B.C. casinos. The provincial government admitted it was not fully aware of what had been going on.

Multiple whistleblowers have come forward to expose wrongdoing and we have learned that the initial estimates of money laundering were staggeringly low. Indeed, the attorney general announced in January that as much as $2 billion of dirty money flowed through B.C.’s casinos and housing market in a single year. We know now that this issue is directly tied to the opioid crisis, which has taken so many lives. This underground industry is directly linked to the more than 1,400 people who died due to opioid overdoses in B.C. last year. Money laundering has also affected our housing market, contributing to skyrocketing housing prices.

People are losing trust in government. That cannot continue.

How can this level of crime exist without punishment or even knowledge? These unanswered questions are precisely why we have a duty to act quickly and decisively to get to the heart of what has unfolded and how we can address it.

We need a public inquiry.

An inquiry functions outside of partisan influence or criminal jurisdiction. Like the Charbonneau Commission in 2011, public inquiries can supplement criminal charges with real, actionable recommendations to identify, reduce and prevent such events from reoccurring. That is something that criminal charges are unable to address. In other words, it is about more than getting to the bottom of who is guilty, it is about changing the toxic environment that allowed these systemic abuses to occur in order to safeguard the public interest going forward.

B.C.’s international reputation as a haven for money laundering is now known, not only to international criminal networks but also to governments and citizens across the world, with opinion pieces hitting the pages of majors newspapers like the Washington Post. The “Vancouver model” has become synonymous with international organized crime. Our reputation is in tatters.

More than 76 per cent of British Columbians support a public inquiry. The cities of Vancouver, Victoria and Richmond, and the B.C. Government and Service Employees’ Union have all formally called for an inquiry.

While an inquiry would cost millions and take years to complete, the costs that have been carried by our province for years are far greater. The issue hints at corruption and a culture of silence condoned at the highest levels. An inquiry must be taken out of the hands of politicians and given independence to do its work.

Two weeks ago, I called on the provincial government to initiate a public inquiry into money laundering but they not committed to taking this crucial step. Money laundering was able to invade our province and the public deserves full answers and a clear path forward to ensure that we root it out. That is why I and the entire B.C. Green caucus will continue to insist that we get an independent public inquiry into money laundering in the province.

Today I rose during Question Period to call on the BC Government to initiate a full scale public inquiry into Money Laundering in British Columbia. The purpose of such an inquiry is to remove the investigation from partisan influence, protect the public interest and restore public trust. The B.C. Green Caucus does not ask for this lightly. However the financial impact money laundering has had — and that it continues to have — on the province is staggering: the federal Ministry of Finance estimates the problem at least $1 billion annually.

Over the past two weeks, my colleagues Adam Olsen, Sonia Furstenau and I have been using Question Period to explore what government is doing to deal with British Columbia’s money laundering scandal. The responses to our questions suggest that while the government has been doing a good job on a variety of fronts, we should bring the investigation into one, independent public inquiry.

We believe that there is enough evidence now to warrant the provincial government starting down this path, without waiting for more reports. Future reports still outstanding can feed directly into an inquiry. We further believe that the terms of reference for the inquiry must be broad enough to address money laundering, organized crime networks, the real estate market, the opioid crisis, and the links between them.

An independent public inquiry is the best course of action because inquiry commissioners can have the power to subpoena witnesses and compel testimony. Furthermore, it can run parallel to any criminal investigation as was done in Quebéc with the Charbonneau Commission.

We are joined in the call for a public inquiry by the cities of Victoria, Richmond, and Vancouver, more than 76% of British Columbians, Port Coquitlam Mayor Brad West, the BC Government Service Employees Union, and several petitions signed by thousands of British Columbians.

Below I reproduce the video and text of my question period exchange with the Attorney General. I also append a copy of our media release.

Video of Exchange

Question

A. Weaver: Please let me start by thanking members of opposition and the minister for canvassing such an important issue and having the dialogue that led to some very informative answers that we can take back to our constituency. I thank you for the questioning there.

A recent article from the Vancouver Sun pointed out that the scale of money laundering happening here in British Columbia is still unclear. A report last year from the Paris-based financial action task force indicated that $1 billion a year was laundered through a “massive” underground bank in British Columbia that served Mexican cartels, Asian gangs and Middle Eastern crime groups.

Illegal gambling money, drug money and money derived from extortion was laundered in British Columbia to supply cash to Chinese gamblers. Yet, our government continues to take a reactive approach to money laundering. There is a deficit of public trust in our province, and the people of British Columbia deserve a government that will take a more proactive approach to this issue.

My question to the Attorney General is this: will the minister introduce the public inquiry into money laundering in British Columbia?

Answer

Hon. D. Eby: I thank the member for the question and all members for the tone of the Legislature today. I think it’s great.

In terms of the member’s question about the approach that the government is taking, we were clear from the very beginning about why we have taken the approach of doing reviews into money laundering versus a public inquiry. We can move faster. We can get the information we need, and we can stop the activity that is actually taking place in British Columbia. We saw that in the casino file. We were able to stop the activity of bringing bulk cash into the casinos very quickly as a result of a review. A public inquiry takes longer to get to those kinds of results.

But that doesn’t mean that we don’t have the same questions that the member has about who knew what when, what kind of accountable should there be and the kinds of questions that can be answered through a public inquiry. What it does mean is that we need to take action to stop the activity as quickly as we can. The member knows that Dr. German is currently working on questions related to horse racing, luxury cars and real estate. I can tell the member that Dr. German is already uncovering some very disturbing information that’s causing government to take action and enabling us to take quick action. I’m very grateful for Dr. German doing that kind of work for us. But that does not exclude the possibility of a public inquiry.

I thank the member for making his party’s position very clear on this issue and all British Columbians, frankly, who have written to me about this issue to express their interest in a public inquiry as well.

Supplementary Question

A. Weaver: I thank the minister for the answer to the previous question.

While I do appreciate the response I received, the question I’m left with is: how many reports and news stories do we need to be written to convince this government that more resources are required to solve the problem? This government needs to develop solutions, not wait for them to arrive on their doorstep and waiting for other reports to articulate them.

Last week the Attorney General made reference to the fact that one of the top five transnational criminal organizations in the world was getting tax credits from Advantage B.C. A criminal organization getting tax credits in British Columbia to launder money is absolutely unbelievable. It’s an unbelievable allegation. It’s clear that government doesn’t yet understand the scope of this issue and that one or two reports is not enough.

In order to get to the root of this problem, we need an independent approach that can address the broad scope of money laundering in our province.

Previously, the Premier stated that he prefers prosecution over public inquiry. However, transparency watchdogs and lawyers who are experts on transnational crime have called for a public inquiry. That’s the only way to effectively deal with this problem. A public inquiry along the lines of what occurred in the Charbonneau Commission can run in parallel to criminal investigations that may or may not be ongoing.

Again, my question is to the Attorney General: when will the minister institute a public inquiry on the issue of money laundering in our province?

Answer

Hon. D. Eby: A couple of pieces about the member’s question. One is in relation to prosecutions. The member knows that the federal prosecution fell apart. It was expected to go to trial. It didn’t. It was ultimately stayed just before it was going to go to trial. Those materials are being reviewed by provincial prosecutors right now to determine whether or not our independent prosecution service will be bringing charges in relation to those materials. That’s ongoing.

A public inquiry, itself, will not result in criminal charges. It provides accountability. It provides the public with transparency into what took place — who knew what and when. It is a political accountability tool, but it is not a prosecution tool. So just to draw that important distinction. Now, that’s not to say it doesn’t have an important place in the tools of accountability of government. It’s just to say that it has that limitation.

The work that we’re doing right now is not reactive. We’re out there. We have experts on this issue. The Minister of Finance — I mean, she cancelled Advantage B.C., right? That is the program that gave the tax credits to Pacman. I mean, we are taking the steps that are needed. We’re getting the experts to provide advice. We’re actually taking steps — the Ministry of Finance on the beneficial ownership registry, so we actually know who owns property, an important tool for police and for tax authorities. We have Peter German out there, working on important issues so that we can take action in relation to those other areas that I told the member about. We’re taking a lot of action on this.

As I said to the member and as I would say to all British Columbians, that does not mean — and the Premier has been very clear — that we have ruled out a public inquiry on this issue. It just means that we’re taking these steps and these necessary steps first.

Media Release

B.C. Green Caucus Calls for Public Inquiry into Money Laundering Scandal
For immediate release
February 26, 2019

VICTORIA, B.C. –The B.C. Green Caucus calls on its fellow MLAs to stand united in calling for an independent public inquiry into the issue of money laundering, which has strong ties to the province’s housing affordability and opioid crises.

“We are calling for an immediate public inquiry into money laundering in BC so to remove the investigation from partisan influence, protect the public interest and restore public trust,” said MLA Andrew Weaver, leader of the B.C. Green party. “The B.C. Green Caucus does not ask for this lightly. However the financial impact money laundering has had- and that it continues to have- on the province is staggering: the federal Ministry of Finance estimates the problem at $1 billion annually.”

The province made international headlines last year when a report by the Paris-based Financial Action Task Force, a body of G7 member countries fighting money laundering, terrorist financing and threats to the international financial system, was leaked to the press. The report highlighted B.C. money laundering activities, of which the province admitted it was not fully aware.

“An independent public inquiry is appropriate as it can have a broad scope, functioning outside of partisan influences or criminal jurisdictions and extensive enough to include all senior public officials and elected members of the Legislature. Public inquiry investigations can involve interviews and oral testimony, and commissioners can have the power to subpoena witnesses. These investigations get to the heart of the complexity of what exactly happened and how it was allowed to happen.

“Although inquiries are not courts, they often exist alongside criminal investigations-such as the Charbonneau Commission in 2011- supplementing those criminal charges with real, actionable recommendations to identify, reduce and prevent such events from happening again. This is something purely punitive criminal charges do not address.

“The BC Green Caucus is not alone in its call for an independent public inquiry into the issue of money laundering  in BC. We are joined by cities of Victoria, Richmond and Vancouver, and more than 76 percent of British Columbians polled last year support an inquiry. The chorus grows daily.

“An inquiry of this nature will take time, but so too did this money laundering scheme with evidence going back at least a decade. And the financial repercussions of a skyrocketing housing market and the devastating impacts the of opioid epidemic on the health and wellbeing of British Columbians will possibly span many years into the future. We owe it to ourselves and our children to investigate the links between money laundering, real estate, drug trafficking, and organized crime.”

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Media contact
Macon McGinley, Press Secretary
250-882-6187, macon.mcginley@leg.bc.ca