The BCLC Reports and Freedom of Information law

Last week, after a nine year struggle, the CBC was finally granted the right to gain access to documents related to the largest penalty fine ever issued to a provincial gaming corporation.

In 2010, FINTRAC, the federal agency which investigates and prevents money laundering, issued a $695,750 “Administrative Monetary Penalty” to the B.C. Lottery Corporation after a compliance examination determined that the corporation had been filing reports incorrectly for years.

BCLC disputed these findings and characterized the problems as “administrative in nature,” according to a massive, two-part report on money laundering in B.C. which was published in 2018 and 2019.

Peter German, the expert appointed to create the report, noted that the fine was issued a year after FINTRAC conducted “an examination of the quality of BCLC’s reporting to the federal agency.”

“Findings included under and over reporting of reports. BCLC disagreed, noting computer issues at both ends. A tug of war ensued between the agencies,” he wrote.

“FINTRAC conducted another compliance examination late in 2009, resulting in an Administrative Monetary Penalty (AMP) of $670,000 being assessed against BCLC.

According to FINTRAC, BCLC had been reporting incorrectly for years.”

On the one hand, according to German, we have BCLC saying that these records would show that their “under and over reporting” was caused by silly admin errors and computers being computers. On the other hand, we have a federal agency which specifically investigates money laundering saying that these “errors” were so bad that BCLC deserved the largest compliance fine ever given to a provincial gaming corporation in Canada.

These reports highlight suspicious transactions which may be signs of money laundering. Whether or not these reports contained information related to incidents involving duffel bags of cash being exchanged for chips is unknown to the public, because in 2012, BCLC was granted a confidentiality order which blocked the records from being released.

This took place after the CBC filed a freedom of information request for the records in 2011 — a case which BCLC fought and lost, after it was brought to the freedom of information commissioner who ordered BCLC to disclose the records.

At this point, it seemed like BCLC had already expended a lot of effort to keep these records a secret. But they were just getting started.

Over the next six years, BCLC fought the penalty and fought to keep the records confidential both in the B.C. Supreme Court and Federal Court. Eventually in 2017, the latter court struck down the penalty in an appeal. Since then, German acknowledged that BCLC is meeting reporting requirements, and FINTRAC has maintained that BCLC has made “significant progress in improving” its report filing.

BCLC’s reasons for keeping the records secret varied considerably over time according to the CBC, which once again filed an FOI request to both BCLC and the Ministry of the Attorney General in 2018, which released some of the records, though the important sections were redacted.

In response, Attorney General David Eby told the CBC that the process of releasing the records has “been almost absurdly complex,” and that, even though his ministry is holding the information, he wants it to become public knowledge.

The corporation’s ability to use the courts as a way to keep records secret for years reveals a disturbing imbalance of judicial power, especially because these records contain information pertaining to systemic noncompliance with possible links to financial crime. Whether that noncompliance was unintentional in the first place is no longer relevant, because the ensuing — and presumably expensive — court battles absolutely were.

Restricting access to information restricts our ability to ensure that those who have gained power through wealth are not abusing that power in order to facilitate activities like, you know, laundering money.

Now, in advance of the upcoming provincial inquiry into money laundering, the records may be released to the public after all, once BCLC applies to lift the confidentiality order.

Knowledge is power, and being able to use the court systems to hide the truth unjustly shifts that power away from the public, and gives it to corporate entities who may not always have the public’s best interests in mind.

Watchdogs and regulators like FINTRAC and the Office of the Privacy Commissioner desperately need more government and institutional support. They need to be given more effective tools to ensure the accountability of organizations without the threat of facing endless delays and court appeals.