Senior magistrate Juan Wolffe spoke for the first time in public yesterday about who is responsible for vetting people who profit from Bermuda’s multimillion-dollar betting industry.
Mr Wolffe, chairman of the Betting Licensing Authority, told a licensing hearing that it was up to the Cabinet minister with responsibility for the betting sector to carry out background checks, do due diligence and “ensure that licensed premises are not running afoul of any anti-money-laundering laws or regulations”.
His statements were the first he has made since a special report was published by The Royal Gazette last May that revealed that the financial histories of people who applied for bookmaker’s and pool betting licences were not always checked by the Ministry of Finance.
The investigation also found that little information had been gathered on non-Bermudians who held a financial stake in betting shops on the island.
The Royal Gazette later reported that the Government was told in early 2016 that the sale of American lottery tickets at a betting shop on the island appeared to breach “numerous” laws in the United States, including some designed to stop money laundering.
Mr Wolffe did not comment on the special report, but said: “As everyone knows, there seems to be this misunderstanding as to the extent of our functions as the Betting Licensing Authority.
“We grant the licences but the purview and overview and the regulation of licensed premises is in the hands of the minister.”
He said the minister let the authority know about the business reputation of betting shops and the financial stability of licence applicants and also vetted the financial guarantees which licence holders must provide.
Mr Wolffe said: “It’s also the minister’s responsibility, not the betting licensing authority, to revoke licences.
“It’s the minister’s responsibility to ensure that licensed premises are not running afoul of any anti-money laundering laws or regulations.”
Responsibility for the betting industry has bounced between four different ministers in the space of little more than a year.
Experts have several times warned of a lack of controls to prevent “dirty money” transactions in the sector.
David Burt, at the time Minister of Finance as well as Premier, had responsibility for betting shops at the start of 2018.
The responsibility shifted to Jamahl Simmons, then the economic development and tourism minister, in February that year, with the Bermuda Casino Gaming Commission set to become the industry regulator.
The gaming commission became the responsibility of new finance minister Curtis Dickinson after a Cabinet reshuffle in November and betting shops moved to Kathy Lynn Simmons, the Attorney-General and Minister of Legal Affairs.
Mr Dickinson told Parliament at the start of this month that he would assume responsibility for all gambling activity, including betting shops.
He said: “It is the intent of Government to transfer the regulatory responsibility of betting shops from the Betting Licensing Authority to the commission.
“In order to ensure this sector is regulated thoroughly and to a level or standard equivalent to mature regulatory jurisdictions, the current legislative framework will need to be revised.
“The commission is poised to complete the legislative framework, including anti-money-laundering/antiterrorism financing controls, for licensing and supervision of betting and other non-casino gaming activities in 2019.”
Mr Wolffe highlighted that there had been “some changes” in ministerial responsibility for betting shops.
He asked representatives of Gametime, Seahorses and Triple Crown Racing, who have all applied to renew their licences, to explain what checks were done by the Government.
Albert Steede, the owner of Gametime and Seahorses, said: “The minister checks with the social insurance and payroll tax, just to ensure everything is updated, then they submit a letter to us. They confirm that all taxes and everything is paid up to date.”
Mr Steede and Andrea Joseph, manager of Triple Crown Racing, said they did not have all the documentation needed from the minister for their licence renewals.
Mr Wolffe said: “If the minister is delayed in giving responses, that’s going to delay us.”
Elizabeth Christopher, a member of the authority, asked the applicants to produce written statements on how betting was conducted at their establishments.
She said: “I’d like to know a bit more about the mechanisms of the bets that are taking place.”
Yesterday’s hearing was adjourned to 1pm on Monday because the court recording system was not working and the court computer systems were down.