Ontario casinos recorded $372M in suspicious transactions last year. Some critics call for urgent action

More than $350 million in suspicious transactions were recorded in Ontario casinos last year – a trend that requires urgent attention if the province intends to keep dirty money out of its gambling facilities, critics say.

Freedom of information requests made by CTV News show that $372 million in suspicious transactions were reported in Ontario casinos in 2022. The multi-million dollar figure follows years of pandemic lows but is still some $38 million higher than pre-pandemic levels.

Provincial gambling officials say the high number is a sign casino staff are rigourously reporting suspicious transactions, though the NDP critic for the Attorney-General, Kristyn Wong-Tam, said the volume is a major concern.

“I think that amount is quite alarming,” Wong-Tam said. “Clearly, more needs to be done and more needs to be done proactively.”

Among the transactions revealed in an affidavit tied to an OPP investigation is more than $4 million in casino buy-ins and withdrawals over several years by one man, Branavan Kanapathipillai.

His huge cash buy-in at Pickering Casino Resort in July 2022 sparked casino staff to write suspicious cash transaction reports and alert the authorities.

“He made 10 transactions ranging from $50,000 to $100,000, totalling $824,700,” wrote an officer in the affidavit.

“The source of cash was unclear, and it was atypical for an individual to possess such a large amount of cash,” the officer wrote. The report notes that unsourced cash is an indicator of possible money laundering.

But despite the red flags, the casino still accepted his cash, as did at least three other casinos since 2016, the affidavit says.

The One Toronto Gaming Anti-Money Laundering Unit identified Kanapathipillai as “having conducted suspicious transactions due to the discrepancy between his occupation and casino gaming activity, the spike in his gaming activity, and the high number of large cash transactions,” the affidavit says.

From Oct. 30, 2021 to Sept. 14, 2022 at One Toronto Gaming sites, Kanapathipillai generated 48 large cash transaction reports totalling $1,529,700, 38 casino disbursement reports totalling $1,348,115, $79,800 in lower level cash to chip transactions, and $37,500 in lower-level chip-to-cash transactions, the affidavit says.

In November 2022, Kanapathipillai’s attempt to buy in with nearly $100,000 of cash at Niagara’s Fallsview Casino was stopped when casino staff flagged it to the authorities, and the OPP seized the cash.

Kanapathipillai told investigators he was gambling with the proceeds of a third mortgage, though didn’t show up to repeat that claim at a court hearing this week to decide whether the seizure will be permanent.

Gambling officials in Ontario say the filing of the reports in Kanapathipillai's case is a sign that the system put in place to monitor suspicious cash transactions is working and enabling law enforcement to follow the money.

“We can confirm that this matter was the result of an investigation conducted by the OPP Investigation and Enforcement Bureau embedded within the Alcohol and Gaming Commission of Ontario (AGCO),” said a spokesperson for the AGCO.

“The presence of an embedded police bureau that specializes in money laundering and related investigations is unique to Ontario, compared to other jurisdictions. The IEB works closely with the OLG’s Anti-Money Laundering Team to ensure casino reporting is monitored and information about suspected money laundering is identified and investigated,” the spokesperson said.

The AGCO announced new standards in 2022 that require casino operators to ascertain and corroborate a patron’s source of funds, the agency said.

CTV News left messages with the Pickering Casino and Resort to ask about why it accepted $824,700 in cash in July 2022 when it was “unclear” what the source of the funds were, but did not receive a response.

Figures released to CTV News Toronto through a Freedom of Information request show the number of suspicious transactions plummeted from $334 million in 2019 to $134 million in 2020, as the pandemic shuttered casinos. In 2021, the total suspicious transactions fell still further, to $116 million, but as the pandemic waned and casinos reopened, the suspicious transaction totals soared to new heights.

Across Ontario, casino gaming sites are expected to generate $158 million for host communities, according to the Ontario Lottery and Gaming business plan.