Tag Archives: Rich Coleman

Did Cabinet Seize Charity Money to Satisfy Casino Demands for Retractable Roof?

BC Place Roof
Photo of BC Place model, by Dustin Sacks from the Flickr Creative Commons

Mystery solved.

For two years the BC public and charities have wondered why the government took the stunning and inexplicable step of clawing back tens of millions from BC charities in one year alone, and seizing some $200 million more over 6 years.

But today it’s all clear. The BC government diverted hundreds of millions of dollars from charities and non-profits that we could have a retractable roof on BC Place Stadium instead of a dome replacement.

It’s clear from the timeline.

In the summer 2009 the BC Cabinet had a very serious problem. Their original $150 million estimate to build a retractable roof on the stadium was spinning out of control–in a single year it had more than doubled to $400 million and was growing rapidly.

Clearly, more responsible options had to be considered.

But the Las Vegas based Edgewater Casino owners, Liberal donors and insiders who hadn’t finalized their own deal with PavCo, wanted nothing to do with government fiscal responsibility. They wanted a retractable roof, and they played serious hardball to get it. Anything else was a deal-killer to them, and they made that crystal clear.

Where was the money to come from to satisfy the Edgewater Casino demands for an incredibly costly roof? Rich Coleman was the minister responsible for the BC Lottery Corporation, the casinos and also for gaming grants.

If the PavCo Edgewater deal was to survive, Rich Coleman had to be part of the solution.

This was the context in which Coleman moved in the summer of 2009 to claw back $36 million already committed to BC charities and cut them off from access to over $200 million over the next 6 years.

Today, more than two years later, as charities and non-profits across the province get ready to close, the roof opens on BC Place Stadium.

The Timeline

In May 2008, when the retractable roof was originally proposed, all-in costs were pegged at around $150 million. By November ’08 those projections had soared to $365 million.

In the spring and early summer of 2009 PavCo called for proposals to develop the BC Place lands. Paragon Gaming, the owners of Edgewater Casino and two other small market casinos in northern Alberta, submitted a bid to build a mega-casino complex onto the stadium. While that bid was under consideration, Paragon shareholder and board member T. Richard Turner, himself the former Chair of the BC Lottery Corporation, wrote a $50,000 cheque from his family company to the BC Liberal party for its May election campaign.

Mr. Turner had purchased shares in Paragon Gaming while still the Chair of BCLC, resigning from that board only months before Paragon’s purchase of the Edgewater Casino.

A month after the Liberal victory, Paragon was selected as the winning bidder, and began negotiations with PavCo to finalize terms.

But storm clouds were already forming. According to Kevin Krueger, the minister responsible, “it was very common knowledge that the bids to build the retractable roof had exceeded the estimate …fairly substantially. People knew… that (cabinet) would be wrestling with that question.”

Faced with a balking cabinet, Turner placed a call to Kevin Krueger’s private cell-phone, saying that Paragon considered its deal with PavCo “conditional upon a retractable roof,” and that failing to build one was a “deal-breaker”. The province had to call Turner’s bluff or find cash quickly.

In July 2009 Rich Coleman, minister responsible for social housing, BCLC and charitable gaming grants suddenly made what seemed then like an inexplicable move. Without warning he seized $36 million already committed to BC charities’ budgets from their legal entitlement to gaming proceeds.

With the stroke of a pen Coleman slashed grants to charities to pre-1995 levels, instantly securing just over $200 million from the charities’ gaming entitlement over 6 years.

Almost exactly the amount needed to meet Paragon’s demands for the retractable roof.

By fall 2009, events were moving quickly, but PavCo’s deal with Paragon was still not finalized. BCLC CEO Michael Graydon’s diary discloses that he brought Paragon VP Dennis Amerine before Treasury Board on October 1, 2009, where it appears yet more hardball was played.

On October 29, 2009 the province approved a budget for the BC Place roof, upgrades and temporary stadium of $575 million, almost 400% greater than the figure announced a mere 18 months earlier. PavCo went ahead with construction in May, 2010, without even waiting for Paragon to get their approvals.

We may never know why PavCo and Paragon were so confident that City Council would agree to a massive casino expansion, but gaming minister Rich Coleman’s dual responsibility for social housing may be a clue. Was there a tacit or explicit expectation that funds for social housing were linked to approvals for the Edgewater expansion? Is this why city staff’s initial public consultation only notified residents within 2 city blocks of BC Place? Why did almost no one in the city understand what was happening until a citizen’s group brought it to public attention? Why was this application so shrouded in mystery?

Whatever the true facts are, it is clear that charities and taxpayers are contributing hundreds of millions because of pressure from a casino partner that then failed to meet its own end of the bargain, and that .

The Fallout

Hundreds of BC charities and community groups across the province have quietly stopped serving their missions, or are near collapse. The Kelowna Women’s Resource Centre has closed, the Vancouver Children’s Festival is near failure, and the Museum of Vancouver and the Playhouse had to be bailed out by Vancouver taxpayers.

In the last 3 years BC charities have lost almost $100 million in gaming entitlements, destabilizing an entire employment sector responsible for 2.5% of the province’s GDP. Vital services freely available to the public, such as transportation of sick children to treatment, assistance for brain injury survivors, counseling for seniors and immigrants have been cut back or eliminated. There is no telling how many jobs have been lost, but they certainly number in the thousands. It goes without saying that entire system of charities and gaming demands a complete overhaul.

More prudent stewardship of the public purse would have saved those jobs and services and still got a perfectly good roof built for our teams.

Party insiders and cronies, backroom deals conflict of interest by those in positions of trust, the pushing around of small charitable organizations to get at their cash, and wild extravagance with the public’s money.

Opposition Gaming Critic Shane Simpson calls on Christy Clark to examine gaming issues

We received this letter today:

March 9, 2011


VICTORIA – New Democrat gaming critic Shane Simpson has sent a letter to Premier-designate Christy Clark laying out a number of concerns resulting in a crisis of confidence in government-run gambling in British Columbia. Simpson’s letter outlines government mismanagement of gaming issues, including dealing with problem gambling, providing stable and adequate funding to community organizations through gaming grants, addressing concerns about expanding gambling, and monitoring and enforcement of money laundering in casinos.

The original letter is attached as a PDF, and the text is also copied below.

Text of Shane Simpson’s letter to Premier-designate Christy Clark:

Dear Premier-designate Clark,

I am writing concerning the crisis of confidence that is growing in British Columbia regarding government-run gambling in our province. British Columbians are seeing a Minister who does not have a handle on his file and consequently a BC Lottery Corporation that is out of control.

This is best exemplified by the wide-ranging opposition to the Paragon proposal for downtown Vancouver; this opposition crosses political lines and is clearly fuelled by the public’s deep concern over the BCLC’s and your government’s approach to gaming.

The complete mismanagement of problem gambling has increased the risk for some 156,000 of our citizens, as identified by the BC Medical Association. This has been exacerbated by your government’s decision, with no consultation, to expand online gambling, including increasing spending limits to $9,999 from $120 per week, a move that addictions experts have called risky and irresponsible.

British Columbians continue to hear story after story about organized crime being involved in our casinos. Just yesterday, we learned of new concerns around the BCLC’s failure to prevent people from walking into casinos with suitcases full of cash and chips then cashing out with little scrutiny. The media reports of mismanagement are too numerous to list, and include issues that have led FINTRAC to fine the province $670,000 for over 1,000 reporting violations. Many of these concerns have been reinforced by RCMP comments about the inadequacies of the BCLC response.

The bungling of the launch of PlayNow.com leading to a privacy breach and a month-long delay in the launch of the site added to questions about the management of this file.

The BCLC response to these concerns have been reactive at best, with much more attention being paid to million-dollar ad campaigns trying to paper over these problems, something that few British Columbians find acceptable.

Worse still, the government’s decision to slash gaming grants has led to severe hardship or the closure of hundreds of community organizations. None of this is helped by the refusal of the government to separate the Gaming Policy Enforcement Branch and the BCLC into different ministries; the need to separate enforcement from promotion of gambling is obvious to most British Columbians, but not to many of your colleagues at the cabinet table.

While I understand you have announced your intention to set up a commission with a somewhat vague mandate, I see no reason to believe this will be able to adequately address these issues. Given the critical nature of the problem, I believe government must not stall the important task of taking a comprehensive look at all aspects of how gambling is conducted in the province, and I also believe the Legislature needs to play a role in that review. The mechanism for this is through the Select Standing Committee on Crown Corporations, which could prove more effective both in terms of time and money.

For these reasons, I am calling on you to reconvene the Special Committee of Selection so that the Legislative Assembly can appoint members to the Standing Committee on Crown Corporations, which could then be reconvened and directed to do an immediate and full review of government gambling including the calling of witnesses. This could easily occur at the same time the Legislature addresses a date change for the HST vote.

The committee must address a number of critical issues, including, but not limited to:

1) How to properly support problem gambling. Of critical importance to this discussion is the separation of the Gaming Policy and Enforcement Branch into a separate government ministry from BCLC’s gambling promotion activities.

2) How to provide stable and adequate funding to charities and community organizations who are supposed to benefit from gambling revenues as part of the government’s social contract. The $15 million increase you have promised to community organizations still falls $24 million short of 2008/09 funding levels.

3) How to address the significant concerns of the people of British Columbia who worry about expanding gambling, as evidenced by the widespread opposition to the expansion of the downtown Vancouver casino.

4) How to effectively monitor and crack down on illegal money laundering activity in casinos.

5) An assessment of the proliferation of gambling facilities in the Lower Mainland and whether it is now counterproductive to continue expansion.

Given the serious nature of these issues, I am calling for you to take drastic action including replacing Mr. Coleman as the Minister responsible for this file, and instructing BCLC to immediately suspend any gaming expansion, including the Paragon relocation and expansion project in Vancouver, until the committee has reported out to the Assembly. These actions would demonstrate your agreement that this file needs real and immediate attention. I trust you agree with me that this is an urgent matter, and as such the committee should be directed to report back within eight months.

Gambling revenues have become an important source for government. However, the people of British Columbia expect a high standard of scrutiny and responsibility with this file. They have not received that from the Minister or the BCLC. They now expect you to act.

I look forward to your response.


Shane Simpson, MLA, Vancouver-Hastings
Opposition Critic for Housing and Social Development

PUBLIC FORUM Feb. 9 on massive casino expansion for Vancouver – come & be heard!

Democracy consists, unfortunately, in citizens showing up to meetings. Sad fact, but true!

Please join us:

Chinese Cultural Centre
in Chinatown
(Stadium-Chinatown skytrain station)
7 pm, Wednesday February 9
(See the Facebook event page)

50 East Pender Street between Carrall and Columbia
(travel instructions to the site, click the link above)

Please come out. You will have fun, meet a mix of people, and feel good about helping us demonstrate our numbers. Bring your ideas and your concerns about the proposed Edgewater mega-casino.

If we approve this mega-casino in Vancouver—if this public land is effectively given away to a sketchy Vegas company on an endless 70 year lease—we will never be able to get rid of it. Is this the image we want for Vancouver, internationally? No other major Canadian city has put a casino in its downtown core, or even close to residential areas. Once we go down this path, we can’t turn around. They don’t just want to put this casino in our downtown, they want to make this the biggest casino in Western Canada, and to have it built by a company that has only ever built truck stop, highway-side, trailer park casinos. The City of Vancouver has not done studies that indicate what the true economic costs of a casino are, but they easily make up a sum in the millions. And for what, $17 million a year? That’s not enough of an inducement for Vancouver – that’s a pittance in the City budget. This is a bad idea. Come out and have your say.

Vancouver will only be forced to make the right decision if the citizens of Vancouver show up and get involved.

Thank you!

Is the public, not the casino, in fact paying for BC Place Stadium roof?

Press release today from the NDP. Some good questions were asked. Will Rich Coleman and the BC Liberals answer? Why is so much casino revenue being funneled right back to the private casino owners?

Spencer Chandra Herbert
Official Opposition Critic for Tourism, Culture, and the Arts
MLA, Vancouver West End

Jan. 9, 2011


VANCOUVER — As residents of Vancouver prepare to formally weigh in on the proposed Edgewater casino expansion, the B.C. Liberal government must let the public know whether the casino is going to end up being subsidized by taxpayers even while gaming grants for community groups are being cut, the B.C. New Democrats say.

“The people of B.C. have every right to question whether the top priority for gaming revenue should be subsidizing private casino companies’ car parks and show lounges even while the B.C. Liberals are slashing funds for small charities that help seniors in need, youth engage through the arts, people learn to read, and adults with disabilities connect with their communities,” said New Democrat tourism and arts critic Spencer Chandra Herbert.

“British Columbians were told the proposed Edgewater casino expansion would pay for the $563 million B.C. Place roof project, but we now have to wonder if the public will actually be paying for the casino.The B.C. Liberals must tell the people of B.C. how much government revenue the proposed expanded Edgewater casino is eligible for, and justify why public money should be used to subsidize well-established private companies that are generating hundreds of millions in profits every year.”

Casinos can receive a subsidy amounting to three per cent of their net win in the form of a Facility Development Commission, which can be used for capital projects. An additional one-time subsidy, an Accelerated Facility Development Commission, can amount to an additional two per cent of a casino’s net win. Together, these subsidies have offset around 40 per cent of the capital costs of casino development in B.C. in recent years.

The proposed new Edgewater casino would have double the number of slot machines and table games compared to the current casino, and, if approved by Vancouver council, would be the largest casino in B.C. The expanded Edgewater would pay an expected $6 million a year in lease payments to the province.

While it is not known how much subsidies in FDCs and AFDCs the proposed casino would receive, Chandra Herbert pointed out that since the province estimates the new Edgewater will bring in $130 million per year in revenue, it can be estimated that the expanded casino could receive between $3.5 million and $6.5 million per year in subsidies.

“Casinos were welcomed into B.C. with the understanding that they would generate revenues for non-profits and charities. But under the B.C. Liberals, that social contract has been broken. Gaming grants are actually lower now than they were in the 1990s, even though revenues from gaming have increased dramatically.” said Chandra Herbert.

According to figures supplied to the Vancouver Sun by the B.C. Lottery Commission, casino operators received $40 million in FDCs in 2009-10, up from $16.5 million in 2001-02.

The B.C. New Democrats are advocating for open and transparent governance, including the separation of gaming policy and gaming enforcement in separate ministries, and a full restoration of gaming grants to charities.


Contact: Sara Goldvine 250-208-3560

Comment on Vancouver’s Oak Street Shooting: gangs and money-laundering

The shooting of 10 gang-related people on Vancouver’s westside over the weekend is an astonishing punctuation mark in our history. We all know this horrific escalation of violence is out of any control by police and civil authorities, and no end is in sight.

Most of us associate gangs with violence and street warfare, but these incidents are only ancillary to the massive industry behind them. Money is the lifeblood that feeds it. Controlling the gangs is as simple, and as overwhelmingly difficult, as this: STOP THE MONEY.

It’s impossible to stop the drug business, the prostitution, human trafficking, gun and weapons trade, loan sharking and other commerce that preys on human misery and weakness.

Yet consider this: almost ALL gang-related transactions are cash, and that cash, hundreds and hundreds of millions of it, must be laundered into “legal” currency through conventional business outlets.

FINTRAC (Financial Transactions and Report Analysis Centre of Canada) is the federal government agency tasked with discovering, scrutinizing, disrupting, and shutting down money-laundering activities. It has identified casinos as a high priority focus for money laundering by organized crime and terrorists–which BC has had more than its fair share of: see  FINTRAC – Money Laundering Typologies and Trends in Canadian Casinos – Financial Transactions and Reports Analysis Centre of Canada.

FINTRAC tracking indicates that money laundering in casino venues has increased significantly from 2007-08.

For all their talk about integrity and law and order, the BC Lottery Corporation and the BC government have almost completely abandoned the nexus between legal gambling operations and money-laundering by organized crime.

In late 2008 the Integrated Illegal Gaming Enforcement Team issued a damning report, which said “Canadian casinos are extremely vulnerable to money laundering because they deal in cash and handle tens of millions of dollars every day… members of organized crime also used casinos for criminal purposes and… some of these criminal elements have successfully infiltrated the industry. “ See RCMP on money-laundering.

The report goes on to say that in recent years FINTRAC has alerted the RCMP to suspicious transactions involving casinos, with amounts across Canada totalling over $40 million, but that, “because of other priorities and lack of resources, at this time, nothing is being done to investigate these situations.”

Most of us, faced with such an incendiary report, would immediately beef up policing of casinos, yes?

Obviously we don’t understand how protecting the public interest actually works in the greatest place on earth.

Because the real answer was to call an urgent in-camera meeting of the IIGET Consultative Board with representatives of the Gaming Branch, to review the report. This happened on January 26, 2009, and concluded with a discussion of the “uncertainty of future funding for IIGET.”

Within three weeks, internal emails reveal, the die was cast. IIGET would be disbanded. See the emails concerning the closure of the integrated illegal gaming enforcement team. To this day BC has no dedicated specialized policing of casinos and the money-laundering and loan-sharking that go on inside their premises on a daily basis: The announcement was made April 1, 2009, which probably tickled the funny-bones over at BC Gaming.

And what has been the result?

The BC Lottery Corporation seems to have turned a blind eye to the whole business. In July of this year, FINTRAC, in an unprecedented move, fined the BC Lottery Corporation $670,000 for inadequate reporting of suspicious transactions–the first fine of a gaming regulatory body in Canada. BC Lottery Corporation president Michael Graydon brushed off the offenses as clerical errors.

Mr. Graydon, Solicitor General Rich Coleman: We are seeing the results of your negligence on our city streets. Our children are waking in their beds to the sound of gunfire outside their windows.

Faced with the opportunity to help stop this hellish business, you are doing nothing. Worse than nothing.

Give us real policing in our casinos, and stop pretending that everything that goes on inside them is just fun and games.

Concerning Casino Links to Organized Crime


To the average member of the public, gangs are associated with violence and turf wars. This view masks the reality that organized crime is fundamentally a large scale and powerful business, with operations throughout society.

If you think organized crime will not touch you or your family through the expansion of gambling, think again. Last year Betty Yan, a mother with children at a prestigious west side school, was shot to death in a Richmond parking lot. She was a loan shark working with gangs. Her clientele were gambling addicts in Lower Mainland casinos.

The damage didn’t end with her death. Parents at the west side elementary school, afraid for the safety of their own children, forced the woman’s young and traumatized children out of the school. And Yan was not the only murder victim tied to gambling and organized crime.

In 2006, loan shark Lilly Li left her regular shift at Richmond’s River Rock Casino with somewhere between $20,000 and $300,000 in cash, and disappeared. Her body was found months later, buried in a shallow grave at Jericho Beach.

This is happening in our city–our Metro Vancouver–and it is part and parcel of the expansion of legalized gambling and the building of casinos in our midst.

Right here in Metro Vancouver loan sharks charge up to 20% a day, and victims don’t believe police can do anything to protect them. Terrified of reprisals against the debtor or an innocent family member, loan shark victims are often forced into prostitution and drug-dealing to pay off their gambling debts: CBC News – British Columbia – Casino loan sharks a tricky target: RCMP

And just who do you think is there to help them with that little money-making sideline? Why, the gangs, of course. All under one roof, care of the BC taxpayer.

It didn’t used to be this way.

BC gambling in the old days mainly involved provincial lotteries and smoky bingo halls operated by charities. Those days are long gone, and the glittering gambling palaces that replaced the bingo halls are the perfect venue for budding young Scarfaces with their loan shark, money laundering, and drug dealing activities operated by the Hell’s Angels, the Asian triads, the UN gang, and Indo-Canadian gangs.

Apart from correctional institutions, casinos have the highest concentration of gangsters anywhere in BC, says Fred Pinnock, the former commander of BC’s Integrated Illegal Gaming Enforcement Team (IIGET): Ex-unit commander questions government’s commitment to “meaningful” illegal gaming investigations – Public Eye Online

Pinnock goes on to say “There’s a ton of criminal activity being conducted in these places every day, including money laundering, loansharking and other enterprise crimes.”

Policing legalized gambling operations requires highly specialized resources, training, sophisticated data bases and communications, and a far-reaching law enforcement strategy.

Naturally, you would expect that our provincial government, concerned as it is about the protection of the public and the perception that legal gambling operations are squeaky clean, would aggressively target the criminal element. Yup, and there is a great bridge for sale in Brooklyn, too.

The fact is that Minister Rich Coleman, who takes the gaming portfolio with him to whichever ministry he is moved to, has completely abdicated his responsibility to ensure the public is adequately protected in BC casinos. Faced with a report in January 2010 from IIGET that casinos are a hotbed of illegal activity (RCMP Money Laundering Report), and the team does not have nearly enough resources to do even rudimentary investigation, Minister Coleman immediately took decisive action: he disbanded them.

Minister denies illegal gaming report allegations

Now there is no serious oversight of gang and organized crime activity in casino operations. Now, as a result of the most recent cabinet shuffle, BC’s minister responsible for gaming is ALSO the Solicitor-General, and responsible for policing.

Even for gangsters, BC is Open for Business!