Lawyer in alleged trust fund theft claims cash laundered via casino
Richmond real estate lawyer Hong Guo says Chinese police have charged two of her former employees in connection with the disappearance of about $7.5 million that Guo alleges was stolen from her firm’s trust account, laundered through B.C. Lottery Corp. casino accounts and transferred to China in the form of casino chips.
At a press conference Monday, Guo claimed that through her own investigations in B.C. and China, she has forwarded sufficient evidence to Chinese police authorities to secure charges against her former employees. Guo claimed that through court actions, she obtained B.C. casino transaction records to support her case.
Postmedia News has reported extensively on Guo’s case since late 2016.
However, Guo’s allegation that weaknesses in B.C. Lottery Corp. accounts were exploited to launder funds stolen in Richmond and the criminal proceeds were transferred to China will receive heightened scrutiny amid an independent review into allegations of transnational money laundering in B.C. casinos.
The first recommendations of Attorney General David Eby’s reviewer Peter German will be released today.
In legal documents, Guo alleges her former employees developed an inappropriate relationship in the office.
Guo alleges that through a complex scheme, her trust account was drained in March 2016 as the employees forged her name on cheques, then deposited millions in bank drafts into BCLC client accounts. Cash was withdrawn from casino accounts and ended up in China, Guo’s legal filings allege.
On Monday, Guo added new details, alleging massive cash and playing chip withdrawals were made from New Westminster’s Starlight Casino before the employees fled to China.
“The facts I know, is (a female employee) took cash from her account every day, for a short period of time … $700,000, and $800,000. It’s a large amount. So the casino doesn’t think something is wrong?” Guo said.
Guo claimed she also interviewed a New Westminster casino manager about her concerns.
“The manager said that, if you give us bank drafts into our account, the policy is you can (withdraw) as much cash as you like,” Guo said. “As long as it is a bank draft (deposit), you can withdraw cash.”
Guo claimed her investigation showed gamblers can transfer BCLC casino chips to casinos in Asia, thus exchanging B.C. gambling chips for cash outside of Canada.
Guo issued a statement saying: “Evidence obtained by Hong Guo through court order and freedomof-information requests show (a female employee) transferred the money in the form of casino chips from her account at New Westminster’s … casino to casinos in China where they were turned into cash.”
Guo said that for legal reasons, she could not provide casino transaction records to Postmedia. As Guo did not provide documents from China naming her former employees in connection to charges, Postmedia has decided not to name the man and woman.
The BCLC has claimed that patron gaming fund accounts, such as the one allegedly used by Guo’s former employee, have greater protections against money laundering compared to large cash deposits. However, B.C. gaming enforcement branch documents raise concerns that bank drafts deposited into BCLC accounts are not adequately vetted for source of funds.
On Monday, Guo said she believes that in her case, these concerns about bank draft deposits and the vetting of funds in BCLC client accounts were proven true.
The BCLC did not respond Monday to Postmedia’s request for comments on Guo’s allegations.
Guo also repeatedly accused the RCMP of failing to adequately investigate her case.
A confidential B.C. gaming enforcement branch report obtained by Postmedia confirms the B.C. Lottery Corp. received a complaint in April 2016 at Starlight Casino in New Westminster about the woman named by Guo.
“There were concerns that an unknown number of bank drafts submitted by (the woman) for gambling purposes derived from a third party involved in fraud,” the document, known as a Section 86 report, says.
The woman’s gambling privileges were cancelled and two banks, CIBC and BMO, investigated the alleged transactions, the document says.
Several days later, a Richmond RCMP officer “confirmed he was investigating a $7.5-million fraud involving a law firm in Richmond,” the report says. “(The woman) is believed to be the recipient of some of those funds.”
Postmedia pointed to this document on Monday, and Guo responded: “I’m not aware of any action (the RCMP) took ... They didn’t help me at all.”
The RCMP did not respond to Postmedia’s requests for comment on Guo’s allegations.
Guo also claimed on Monday that a B.C. Law Society investigation of her trust fund shortage case has found no issues at her practice.
In response to questions from Postmedia after Guo’s press conference, law society spokesman David Jordan said: “Our investigation of Guo continues and details of any investigation remain confidential unless and until a citation is authorized.”
(She) took cash from her account every day … $700,000, and $800,000. It’s a large amount. So the casino doesn’t think something is wrong?