Ian Mulgrew: No Heads Will Roll In Money Laundering Investigation Report

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The money laundering investigative commissioner has a lot to ponder as he prepares his final report after two years of hearings that did not provide hard data or evidence of embezzlement.

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Those who attended Austin Cullen’s first public meetings wanted a well-deserved award for former Cabinet Minister Rich Coleman and those whom they considered his liberal cronies.

Cullen will undoubtedly be critical of politicians, but he will not take his head on the pikes.

Some people will be embarrassed, but I think the key takeaways will be about the dysfunction of law enforcement, especially when it comes to economic crime and the lack of accountability within government.

Cullen had an unwieldy mandate: consider money laundering in gambling and horse racing; real estate; financial institutions and money services, including unregulated entities that provide banking-type services; corporations and the use of shell companies, trusts, securities and financial instruments; Luxury articles; professional services, including legal and accounting.

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As if that wasn’t enough, he also had to look for misconduct on the part of regulatory authorities and others.

The problem is that the investigation did not establish how much money is laundered, how big the problem is, what damage it causes and if it is worth all the surveillance, reporting and monitoring.

The commission got off to a bad start because it appeared that blatant criminal activity was behind the tide of cash that flowed into the casinos from approximately 2009 to 2015. The whistleblowers promised evidence of hyperbolic allegations, however they turned out to have tokens on their shoulders and none evidence. but rumors and speculation.

Still, it was a riveting tale of international intrigue: politicians deliberately ignored criminal-financed wealthy Chinese gamblers using a dirty money laundromat with the supposed tacit approval of a sitting regulator and an indifferent national police force.

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As witnesses were heard, a narrative emerged that seemed closer to the truth.

Most of the money wagered was lost, and much of it fell into the government coffers.

Criminals could not be linked even though the six- and seven-figure purchases raised concerns about villains like El Chapo.

What happened could also have been rich in gambling addicts who were exploited by loan sharks who profited when the player went bankrupt by legally seizing property promised as collateral.

Regardless, the law enforcement patchwork quilt was a major obstacle in determining what was true and, if it was criminal, ending it. We do not know it yet.

Cooperation and communication have been problematic for decades due to the number of law enforcement agencies, overlapping responsibilities and chains of command: local police departments, mounted on municipal contracts, mounted on provincial assignments, mounted on federal policing priorities, in addition to government regulations and autonomous. bodies.

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The military-style organization that the police adopted in the 19th century must also be reformed to reflect the changing demands of modern society and crime.

Police lack the experience to deal with sophisticated sleight of hand because officers are recruited, receive basic training including mock parades, and must advance through the ranks. There were civil police employees, but without a uniform, weapon and the powers conferred by the Police Law, they were considered second class.

Meanwhile, the best legal and accounting talents are unwilling to learn parade drills and rise through the ranks on the salary of a regular agent.

BC’s Gaming Policy and Compliance Division was made up almost exclusively of ex-cops who didn’t want to interview players because it was too dangerous, they wanted unmarked cars so bad guys couldn’t identify them through their personal car, they needed guns, more power, etc.

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They worked banking hours, rarely visited a casino, and cut and pasted reports from the casinos and the BC Lottery Corporation that gave them the name of the person bringing the suspicious cash, their personal details, and videos. The same material was passed on to the RCMP and the federal financial information monitoring center for their analysis and action.

And relationships between the RCMP, the enforcement branch, and BCLC often appears to have been stale.

Personality clashes, inability to distinguish between rumors and confirmation biases, lack of information sharing, poor coordination – all contributed to the inaction of law enforcement until mid-2015.

The independence of the police was a problem: politicians cannot issue daily operational orders.

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From 2010 to 2015, the RCMP chose to rank gang enforcement and national security above financial crime.

In 2011-2012, for example, they devoted scarce resources to a sting operation that turned two sad sacks from Surrey into Canada Day terrorists. The British Columbia Supreme Court dismissed the case because the Mounties essentially created the crime.

There was also a lack of government oversight of the BCLC and the civil service and there was no robust follow-up to ensure concerns were addressed.

High-ranking ministry staff often had too much on their plate, being reorganized and replaced by colleagues from another department who then had to catch up with new, unfamiliar responsibilities.

In part, that’s because of how big and legalistic the government has become without the accompanying transparency and accountability.

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However, experienced veteran civil servants should have recognized that urgent action was required when concerns identified in a 2011 report were allowed to persist.

Few seem to have realized that something could be wrong. A financial bureaucrat admitted she was unfamiliar with hawalas and underground banking, while senior ministry staff said the staggering amount of suspect cash caught them by surprise in 2015.

These structural problems have been known since the 1990s, but they are difficult to address and complicated by the need for federal and provincial cooperation and coordination.

Cullen has the opportunity to set an agenda for governments to address the underlying failures in the system that led to this debacle: the tangle of law enforcement and regulatory agencies, confusing and overlapping responsibilities, independent departmental silos in government, channels unclear communication and lack of timely accountability.

That will be difficult given the deadline – your final report is due on December 15.

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