British Columbia Lottery Corp. appeals million-dollar penalty

The B.C. (British Columbia) Lottery Corporation is suing the federal government of Canada, claiming that it was wrongfully penalized more than one million dollars (Canadian) for anti-money-laundering and terrorist funding violations earlier this year by a federal financial watchdog.

The lottery corporation says in a notice of appeal filed last week in Federal Court that the Financial Transactions and Reports Analysis Centre of Canada — known as FINTRAC — wrongfully penalized the company for three alleged violations.

The lottery corporation has filed a notice of appeal against Fintrac in Federal Court, alleging that Fintrac has wrongly penalized the Crown corporation for three alleged violations of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act. The notice of appeal was submitted last week.

The lottery corporation asserts that it was not adequately informed that it was being investigated, and that it was instead "ambushed" by the anti-money-laundering authority. This occurred without the lottery corporation having the opportunity to rectify Fintrac's errors and misapprehensions regarding the casino and gaming business.

In a statement, the lottery organization said that it takes the responsibilities that it has assigned to it in accordance with the anti-money laundering legislation in Canada very seriously. It is certain that it has fulfilled all of its legal and regulatory requirements, and it is confident in its stance that it has done so.

Fintrac zeroed in on one unnamed casino patron who had been identified as the highest-volume slot machine player in the corporation's rewards program and was flagged for his frequent use of $100 bills, it stated in the appeal. The patron was identified as having been the most frequent user of $100 bills.

It is stated that the authorities from Fintrac relied on a criteria that was not significant, and that it arrived at the subjective conclusion that the customer was just “gambling too much.”

According to the appeal, the quantity of money that was gambled is not a key aspect in Fintrac's indications of money laundering and terrorist financing. However, the appeal does not specify how much money the player gambled. The rationale of the director is more reflective of a moral or value-based assessment than it is of an objective application of the regulatory framework.

In addition, the lottery corporation asserts that the regulatory body made an incorrect determination when it came to the conclusion that a report of a suspicious transaction including the possibility of money laundering ought to have been filed because of the patron's behavior and responses to investigation questions.

The lottery corporation asserts that Fintrac did not take into account the patron's English language skills or the country from which he immigrated; nevertheless, the document does not mention where the patron is from or what language he speaks.

The customer was determined to be uncooperative and to have provided information that was either false, deceptive, or erroneous regarding his occupation and his ownership of property, according to Fintrac.

As part of its appeal, the British Columbia Lottery Corporation asserts that the regulatory body did not take into account the possibility that the observed lack of cooperation and discrepancies were the result of linguistic and cultural differences.

In March, the lottery corporation was given administrative fines totaling $1,075,000 for three alleged infractions. These offenses included failing to report suspicious transactions, failing to keep compliance policies up to date, and failing to take particular steps linked to the patron who was reportedly considered to be “high risk.”

The appeal that was filed on August 20 states that the British Columbia Lottery Corporation is attempting to have the fines overturned, reduced, or sent back to the director of Fintrac for reconsideration.

A brief statement that Fintrac had prepared stated that the agency would answer written questions, but as of the time this story was published, it had not yet done so.

Source:

“B.C. Lottery Corp. says it was ’ambushed’ in money laundering investigation” , Darryl Greer, The Canadian Press, vancouversun.com, August 27, 2025.