Canadian casinos now coping with new anti-money laundering regulations.
A couple of years ago, there were no news headlines more prominent in British Columbia than those telling the dark and duplicitous tale of money laundering at the province’s casinos. The River Rock Casino in Richmond, B.C. was particularly shunned for its involvement, as the investigation uncovered a rabbit hole so deep, it ran straight through to China.
I won’t get into the ragged details of that fiasco. If you don’t already know the story, you can learn all about it in Queen’s Counsel Peter German’s famous Dirty Money report. The point is, it happened, and for more than a decade before the provincial cover up was revealed.
As instructed, German made a throng of recommendations in his report. Among them, he suggested a strain of amendments to Canada’s Proceeds of Crime (Money Laundering ) and Terrorist Financing Act (PCTFA).
In July of 2018, draft amendments were submitted to federal legislators. One year later, on July 10, 2019, the Regulations Amending Certain Regulations Made Under the PCTFA (henceforth, “Amending Regulations”) were officially released in the Canada Gazette.
New Anti-Money Laundering Regulations at Canadian Casinos
Canada’s commercial casinos are now coping with the federal government’s Amending Regulations. According to the new laws, casinos will be required to comply with the following souped-up AML guidelines.
1. Report all Transactions of $10,000+ to FTAC
As per the Amending Regulations, casinos must report any and all player transactions of $10,000 or more, both incoming and outgoing, in cash or cash equivalent, to the Financial Transactions and Analysis Centre of Canada (FTAC).
2. Maintain Records of all $10,000+ Transactions
Likewise, casinos are required to maintain cumulative records of all large cash transactions of $10,000 or more, when received by person or entity in a single transaction.
3. Maintain Detailed Records of all Player Accounts
Operators must maintain detailed documentation records of every player account opened at the casino. The details on file must include, at the least, the member’s contact information, signature card holder infraction, as well as other vital details.
Furthermore, every member transaction conducted in the casino must be recorded in detail within a running history log, as per the Amending Regulations sections 74(1)-(2).
4. ID Verification of Account Associates
Identity verification and detailed recording is required for all individuals associated with a casino member’s account. This includes anyone 1) opening an account, 2) authorized to transact on another’s account, 3) authorized to give instruction on another’s account, 3) who conducts any transaction for which the casino is required to keep a detailed record.
5. EFT Definitions and Reporting
In respect to (1) and (4) above, the Amending Regulations set forth terms for the handling of large cash disbursements via electronic funds transfers (EFTs). For instance, should a casino member, or any entity acting on behalf of the account holder, request multiple withdrawals that meet or exceed a total of $10,000 within a 24 hour period, the disbursement must be recorded and reported as a large cash transaction.
6. Take Reasonable Responsibility
Casinos are now required to take reasonable measures in determining whether a person requesting a withdrawal is acting on behalf of another. The operator is required to obtain identification, contact information, and determine the relationship between the individual and the third party.
Canada’s New AML Laws Effective Immediately
It is the responsibility of all casinos in Canada to ensure they are operating in compliance with the new AML regulations. They must update and upgrade their monitoring systems as necessary to get the job done. The idea is to ensure all information is documented and reported to the appropriate authorities, who can track activities across all Canadian casinos, preventing money laundering and the eruption of future scandals.