Canada: B.C. creates new gambling regulator seven years after money-laundering warning

British Columbia (B.C) has established an independent Gambling Control Office to oversee casinos and tackle money laundering, seven years after a landmark report urged sweeping reforms to address criminal cash flowing through the province’s gaming sector.

The new office, led by a general manager with independent statutory authority, will have powers to set rules on preventing unlawful activity, assessing sources of funds, regulating advertising, addressing problem gambling, and overseeing security and surveillance. Under legislative changes, the B.C. Lottery Corp. (BCLC) will be required to comply with the general manager’s directives. The office will also regulate charitable gaming and horse racing.

The province stopped short of adopting all recommendations made in 2018, opting not to create a stand-alone Crown agency similar to Ontario’s gambling regulator. The Gambling Control Office will remain within the Ministry of Justice and Solicitor General and will not have its own board of directors. Existing staff from the Gaming Policy and Enforcement Branch will transition to the new office by April 13, 2026.

Peter German, the former RCMP deputy commissioner who authored the 2018 report that exposed large-scale money laundering in Lower Mainland casinos, said he is “generally pleased” with the announcement despite the structure differing from what he proposed. 

“If it can function as an independent body and not be subservient in any way to the BCLC, then the goal is achieved,” German said. “It is essential that there be an independent and transparent regulator and regulatory process.” he told Postmedia News. His report had concluded the former regulator lacked authority over BCLC, which in some cases acted as its own overseer.

The Public Safety Ministry said it determined many of German’s concerns could be addressed without the cost of creating a new Crown corporation. “Both B.C.’s general manager and Ontario’s registrar are responsible for holding regulated entities accountable for compliance,” the ministry said in an emailed statement. It added that implementation was delayed while the province awaited findings from the Cullen Commission into money laundering, and because drafting rules for the new Gaming Control Act required time.

German’s report found systemic failures in casino oversight and revealed that certain Lower Mainland casinos had effectively become “laundromats” for organized crime. He estimated more than $100 million had been laundered through casinos, though Postmedia investigations later uncovered $650 million in suspicious transactions between 2010 and 2016, two-thirds of it in $20 bills. Experts warned that unchecked laundering distorted real-estate markets, fuelled criminal networks and undermined public trust in the justice system.

Further reporting by Postmedia showed money-laundering prosecutions were rare and complex, and that criminals relied on shell companies to move tens of millions of dollars through B.C. Another investigation tied $43 million in properties to the province’s largest laundering case, while an analysis of 12 cases involving $1.7 billion detailed schemes stretching across 20 countries and 30 banks.

B.C. officials say the creation of the new regulator marks a major step toward strengthening oversight, though the full implementation of reforms will continue over the next two years.