The $5,000 chips are down at River Rock Casino. Why?
Documents cite concerns about money laundering, security leaks
Aflood of $5,000 chips that disappeared from River Rock Casino raised concerns about public safety and an alleged underground economy connected to illegal casinos in Richmond, according to documents obtained by Postmedia News.
The documents, which are redacted to protect police investigations, were released to Postmedia in the third phase of a freedom of information disclosure.
They say that in 2016, after “an unusually high number of $5,000 poker chips went missing from River Rock Casino, [this] prompted [the British Columbia Lottery Commission] to initiate a wholesale chips exchange.”
The large volume of missing River Rock Casino chips risked the integrity of BCLC casinos, documents say. But a confidential plan to replace the chips was delayed, according to documents, and there were concerns of an information leak between BCLC and River Rock staff.
The issue became a priority for BCLC anti-money laundering staff throughout 2015, when “River Rock experienced an increase in patrons leaving with large quantities of $5,000 chips,” documents say.
“BCLC believed the high number of outstanding River Rock Casino chips posed a personal risk to the safety of those in possession of large quantities of these chips.”
BCLC eventually completed a recall of $5,000 chips at River Rock in January 2016. Most of the chips had been taken from highlimit betting rooms. VIP gamblers were presented with cash or new chips in exchange for the old casino currency.
However, a recall that had been planned for September 2015 was delayed for “operational” reasons and “cancelled at the last minute,” the documents say. They say River Rock Casino staff were concerned about the chip swap for various reasons, including the potential for upsetting VIP gamblers.
An internal email sent Dec. 30, 2015, among BCLC staff says that corporate compliance executive Rob Kroeker also had concerns as a result of a phone call from a person whose name was redacted from documents.
“It appears that the chip swap information is floating around the River Rock Casino, for [an] end of January date,” the BCLC email says. “[Kroeker] is concerned that we have a leak that would have released this information. Can you advise who is aware of this project from our end or that you have communicated this to?”
A January 2016 email among BCLC staff later said “this is very confidential, but it looks like we will be swapping out all the $5,000 chips on January 18th.”
A BCLC memo regarding the emails exchanged between BCLC and River Rock staff says “that planning for the swap is moving ahead despite ‘comfort level’ concerns of River Rock Casino.”
‘Unsourced chips’ flagged
Also, there were “concerns from River Rock that they might not have enough $5,000 chips for the Chinese New Year, due to the decision not to issue new $5,000 chips until the chip exchange program is complete.”
But in late December 2015, BCLC director of anti-money laundering Ross Alderson wrote: “It appears from the email chain like RRCR are having issues. … It would be nice to have a comfort level [information redacted] it is now a current policy requirement and the service provider should be adhering to it.”
BCLC brass had been concerned about more than just missing chips at River Rock, internal documents obtained by Postmedia show.
The documents say that BCLC executives met with executives from River Rock operator Great Canadian Gaming Corp. in October and November 2014, to discuss problems of extremely large cash deliveries, $5,000 chips leaving the casino, and an alleged network of VIP gamblers from China using “large volumes of unsourced casino value chips at River Rock Casino.”
The documents allege that these “unsourced chips” were delivered by the lender network of Paul King Jin. Later in 2015, Jin’s network became central to RCMP’s E-Pirate investigation into allegations of transnational money-launderers targeting B.C. casinos.
River Rock management present at these late 2014 meetings regarding Jin’s network and unsourced chip allegations included Great Canadian chief operating officer Terrance Doyle, VIP program manager Walter Soo, and Kroeker, according to documents.
Internal BCLC records also make clear that the gambling regulator became concerned that outstanding River Rock $5,000 chips were allegedly being used to fund illegal gaming and an underground economy in B.C.
These records also point to tension with B.C.’s gaming policy enforcement branch. In mid-2015, records say, when branch investigators became aware of the need for a chip recall, they accused BCLC staff of not previously notifying them of a problem that the gaming branch viewed as important to the integrity of BCLC casinos.
Ministry of Finance records from 2016 and 2017 make the connection among BCLC casino chips, organized crime, and illegal casinos. The records say that B.C.’s new Joint Illegal Gaming Unit continues to investigate the use of BCLC casino chips in illegal casinos.
Ongoing investigations have alleged that high-level organized crime networks in B.C. with ties to mainland China are using illegal gambling houses in Richmond and BCLC casinos to launder money for drug traffickers.
When suspects were arrested in raids of six residences, police seized large amounts of cash, bank drafts, suitcases and drug equipment, records say.