Bankruptcy lawyer condemns proposed casino expansion

Since the beginning of public hearings on the proposed Edgewater casino expansion, doctors and lawyers have spoken out against the dangers of another gambling facility in Vancouver. Katherine Wellburn, a bankruptcy lawyer, explains her opposition based on years of experience seeing people go broke as a result of gambling addiction. 

I live in Kitsilano and work in Yaletown. I am a bankruptcy lawyer. I was a registrar in bankruptcy for 8 years and I oppose the expansion of the Edgewater Casino.

I would like to speak about problem gambling and loan sharks since both are causes of bankruptcy.

There was a statistically significant increase in the number of severe problem gamblers in British Columbia of 0.5 percent from 2002 to 2008. According to the Chief Medical Officer, Dr. Carsley, there are 19,000- 43,000 severe problem gamblers in British Columbia.

Dr. Carsley referred to the study from Alberta and Ontario showing that 36-39 percent of gambling revenues come from problem gamblers. That number increases to 60 percent of the revenues from slot machines, which are more addictive.

One of the indicators of a problem gambler is that the gambler lies to family members, therapists or others to conceal the extent of their involvement in gambling. My experience is that gamblers who realize that they have a problem are embarrassed or ashamed and don’t want to talk about their gambling, particularly their losses and the problems that gambling has caused to them and their families.

I asked a recovered gambling addict to come and speak to you. He was a casino employee who became addicted to gambling. He was able to overcome his addiction by quitting his job and moving to an area where there are no casinos but only after incurring hundreds of thousands of dollars in debt and going bankrupt. He wants to put that period of his life behind him.

The problem gamblers I see most often are the ones who gamble away their own money, borrow more, lose that money and go bankrupt to get out of paying their gambling debts.

One indicator is whether a person is a problem gambler is whether the person goes back to gamble another day to try to win back money they have lost. This is the lure of gambling –the gambler can’t quit because the big win might be just around the corner. That would include the bank manager who lost his savings gambling and quit his job so that he could withdraw money from his retirement plan and gamble more. He lost that money too, his wife left him and he went bankrupt.

Another indicator of a problem gambler is “borrowed money or sold anything to get money to gamble.” That would also include the retired couple living with their adult son and his family. The couple put a mortgage on the family home of $375,000 to try to recoup gambling losses by gambling more. Seven months later, they had gambled all of that money away and were more than $500,000 in debt. They lost their house in a foreclosure and bankruptcy.

Another sign of a problem gambler is bailout – whether the gambler has relied on others to provide money to relieve a desperate financial situation caused by gambling. This would include the man who had borrowed money to gamble. His daughter took him to the bank, paid off the debts and begged the bank to not lend him anymore money. He still borrowed more money, gambled it away and went bankrupt. We’ve heard this story more than once – family pays off debts, only to have gambler go into debt again to gamble more.

Problem gamblers risk significant relationships because of gambling. The description fits a woman whose daughter took her to a trustee in bankruptcy to try to get her to stop gambling since the trustee would cut off her credit. That woman assaulted her daughter in the waiting room – she didn’t want to quit – she wanted to keep on gambling.

One of the criteria used to determine whether someone is a problem gambler is whether they have committed illegal acts such as forgery fraud, theft or embezzlement in order to finance gambling. This would include the woman who received $50,000 from a community group to develop a children’s program, gambled it away and went bankrupt. This raises another problem – money laundering – the trustee was unable to trace the money and confirm that it was actually lost on gambling or hidden away somewhere because there is no way to track money in casinos.

I never see casinos as creditors in a bankruptcy because casinos always get paid. They only take cash, not credit.

And people pay their loan sharks because the loan sharks resort to threats and violence to collect their debts. A gambler who owes money to a loan shark will try to borrow money from family members to pay the loan shark because they are terrified of what the loan shark will do to them.

 

Another way loan sharks get paid is by telling debtors how to get money by defrauding creditors, by getting credit cards from companies like the Bay, Canadian Tire, and buying items on credit as directed by the loan shark, and then going bankrupt. This is fraud, but very rarely investigated or prosecuted in BC.

 

Trustees and registrars in bankruptcy may insist that the bankrupt attend Gamblers Anonymous or counselling to deal with their addiction and self-exclude from the casino. Unfortunately, self-exclusion is well known to not work. There are even stories of people who had self-excluded going to the same casino the next night, although if they happen to win, the casino will not let them collect their winnings.

 

Your staff had statistics, showing that BC spent the lowest proportion of gambling revenue of any province on helping problem gamblers and that this figure had decreased from 2008-2009.

 

By contrast, the casinos are permitted to have aggressive advertising on the television radio, SkyTrain, to attract new gamblers and to encourage existing gamblers to gamble often and gamble a lot. The casinos are open 24 hours a day, seven days a week. This casino has buses pick people up at the SkyTrain stations and seniors’ centres. Its expansion plans include a massive increase in slot machines, the most addictive form of game in a casino.

 

The website of the Ministry of Public Safety and Solicitor General lists as one of its initiatives to control problem gambling by ensuring that “the number of casinos and other gaming facilities are limited in the province”. 

More from Katherine Wellburn

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