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a wa w Franco Prom geat er Farce emer 3 2016 inter ike de ng, Minis of Finance IEMA: ENInterRo ocd ear intr ong: Gaming Poy Enforcement Branch (GPE) Horse Racing Drug Investigations Recents contacted by 3 rele Ragitered Gaming workar tom Fasar Downs Race Trak who brought forward sais allegations of ales athe Gang Poi Enforement ranch to enforce dug pole trace aks nets Vancowet Ingato, he informant alleges that tees as high a Mr Mick! Brow, Director at GPE, and {en itas, Exes Dien of Cpe PR, ri liao GP hve olarated nom ‘evplince vith sc provincial horse racing lence rg poly nlaing the flowin: 4+ Aina rina aege canceling the ress of postive mms dng text fran India who was permitted to connue operating atthe rack and wot not suspend; + Amina rindi panning a nil who tested postive for axycoéons on "2016 e cotnuet werkon the track inthe sce bscktvetch uh cass to 20t0 whores foranenteded paid aerthe postive tet upto andineudng 2015304, + Following the positive test of hase formathamghetamine on nota dgusedto imprverace horse performance) due lay to contalaton by someone under the inven ‘fimathampstomin, at ast Indl wre texted nd one tested poste fr ocaina, ‘sotestd postive fr cocaine and THC ond these ndidul were no suspended ‘The rls profting iti deg sey haze with et contac wth horse on the track are there for 008 razon. These rule dzenuroge clus it an ace adccton om having access horses Sette ofnerenrd merit fo comiption or eurl tease pubiesafety ina spor: that can be Alangerous to both acer and res ar reduce the rok af contact contamination pttng eens ‘won ue ti compromising te reptation oF BC ning felts unnecessary Papr2 continued ‘Tisinformant adios that the nforranbefeves thet the sf provider woulshave ve {eleanor these tnd of acta the rach and woul be ito dismiss and/or ban aay Individual employe by them who tested postive fret substances. The formant baie hat some ‘oral this nfrmatin about postive tests may have hee wield fromthe serie prove a wel “heloformant abo avsas me tat she tnfoment helees tha these my not be the on arp oF tolerance forindcvals unde the nuance fi droge mining aie hore ac eens | respect request that you tmmesataly estab an vesteton dependent ofthe Gaming Poly and Enforcement Brenchirto these allegations so that any satene cvs cay be ete abs ‘dressed. am advised hat eres of eats curing these alegations are avalable that have been ‘elted among the follwing indus Maal Gaon Len Meller nna PRigeral, Clin Br, athe thangs at rser Downs. ‘Thankyou in advance for out urge stenton to this matter oa aid a, Vancouver Feo rey (fi OppastonSplaipson or Gang ov IN, ote ed BRITISH, COLUMBIA od 14, 206 David Bby, MLA ‘VagcouverPoitt Grey 2809 West Broadway Vancouver BC VK 266 easzch 354867 Deer ME ‘Thank you for your letter of November 3, 216, regarding Gaming Policy Enforeament Branch (CPEB) Horse Racing Drug investigntions. ‘Governent takes seiousy al egoris of employee misconduct and our role in dnsuring the ‘malntenance of publi confidence in the repulsion oF horse racing end British Columbia's taming indus, ‘have directed the Ministry to consider the best course of action to asvexs the allegations reported in your eter. Thismay include inating an investigation independent ofthe Gaming Policy and Hnforeement Branch. Any suc investigation wil also need to take ito aesouat the ‘governments obligations with espect fo protecting the privacy rights of employers, ‘can assure you that we wil be loking into these allegations and taking Whatever ope ace ecestary 0 determine their securacy. {woul ike o thank you gain fr taking the time ta wae Sincerely, Michal de longs Miniser cs: Athans Meatzelopoule, Depuly Mitiste, Ministry of Finance (Cheryl Wenazenk-Volland, Associa Depuly Minister, Ministry of Finance tay when ee tne Nagas sae Reeseteecint — ei Tyee or BRITISH COLUMBIA 356832 David Eby, MLA Vancouver Point Grey 2909 West Broadway Vancouver BC V6K 266 Dear Mr, B8y: ‘Asa follow-up to my November 14, 2016 response to your letter of Novoraber3,2016, regarding the Horse Racing Unit (RU) of the Gaming Policy Enforcement Branch (GPEB), ‘would like to advise you thatthe matters you rsed have been thoroughly reviewed by an independent third pary, and Tam able to provide you witha certain amount of information about the conclusions, while tl respecting governments duty to protest employee personal privacy. 1 directed the Ministry to consider the best course of ation to assess the allegations, and am advised that Cheryl Wenezenki-Yolland, Astocate Depaty Minister of Finane, engaged George Monit to conduct an independent review. ln addition to being a former auditor gener Mr. Morfitis also well-informed about horseacing rule, governance and regulation He bas previously served on several Administrative Review Hearing panes for the GPEB and he ‘advised government in the development of anew financial model forthe horse racing industry. For this review, Mir. Morfit was dzectd to give specific consideration to the allegations, a well sto evaluate general operations ard polices ofthe HRLU with respect deg use in horse racing, Govesnment’s duty to personal ptivaey prevents me Irom reporting on each specie cireurstane raised in your ltr. Broadly, however, Mr. Morfit found thatthe HRU operates within the legal wuthoity defied in the Gaming Control Act the horse racing polices an rules. While Mr, Morfitt provided some ‘ecommengtions related to operational policies, which have been accepted by GPEB and are bing implemented by the HIRU, his overall findings are cet the drug testing and sanctioning process currently followed by the HRU is comprehensive and comparable to those of other Canadian jurisdictions, the unit applies hore racing industry best pactces, snd th unit has ‘sablished appeoach of regular review and iniprovement Overall, tam pleased withthe Ministry's responsiveness o this matter and that this review by an ‘anpartial and knowledgeable individual has heen completed quickly an thoroughly. and that the findings confi the unis following best practices. ‘Agiin, Loud ike to hank you for tking the time to wit, Sincerely, Micha! do Jong. QC. Minister ct Athans Mentzelopoulos, Deputy Minister, Ministry of Finance: ‘Cheryl Wenezenki-Yolland, Assoviate Depuly Minister, Ministry of Finance Considerations Relating to the Horse Racing Unit, Compliance Division of the Gaming Policy and Enforcement Branch, Ministry of Finance, Government of British Columbia Part 1: Review of Allegations of Non-compliance by GPEB Officials with GPEB Rules and Policies Report by George L. Morfitt, FPA, FCA‘ To Cheryl Wenezénki-Yolland, Associate Deputy Minister, Ministry of Finance, Government of British Columbia January, 18, 2017 ‘A. Allegations Communicated to Minister of Finance BB. Review Terms of Reference and Process!) = B.1 Part-1 Report on Spectic Allegations: ©. Gaming Policy and Enforcement Branch . Horse Racing Unit (RU), GPEB Compliance Division D.1:HRU Drug Testing and Sarctioning Process E. Incidents Cited by Informant Ext Incident A E.1(@) Circumstance E.1(b) Review Findings E2 Incident 6 E2(a) Circumstance E2(0) Review Findings 3 Incident © (a) Circumstance (0) Review Findings F. Further Allegations . Service Provider's intemal Investigetion H. Reviewer's Assessment of Incdent and Alegation Findings ‘tachment: eter detec November; 2046 rom Me Eby, MA; ‘p Minster of Finance, M. de dong Acronyms Goa Gaming Contro! Act, Province of Britsh Columbia goac Great Canadian Gaming Corporation GPEB Gaining Policy and Enforcement Branch HRU Horse Racing Unit, GPEB Compliance Division A. Allegations Communicated to Minister of Finance By lettor dated November 3, 2016 from Mr. David Eby, MLA, to Minister of Finance, Michael de Jong (see Attachment), Mr. Eby advised Minister de Jong that an informant ‘had brought forward to him serious allegations of fallures atthe Gaming Policy and Enforcement Branch (GPEB) to enforce drug policy at Metro-Vancouver race tracks. The informant, a registered gaming worker, alleged that GPEB executive levels as high as the Executive Director of Compliance and the Director of Horse Racing have tolerated ‘non-compliance with basic provincial hase racing licence drug polley. The informant Cited three specific incidents in that regard (see below, Incidents Cited by Informant’), ‘and expressed the belief thet such instanoes may not be the ony examples of tolerance for individuals, under the influence of ilct drugs maintaining active horse raving licences. ‘Mr. Eby pointed out n his letter to Minister de Jong that rules prohibiting ilfet drug use by those having direct contact with horses on the track: “discourage individuals with an ‘active addiction from having access to horses in a state of increased vuinerabilty to corruption or eoercion; increase public safety ina spor that can be dangerous to both racers and horses; and, reduce the risk of contact contamination putting legltimately won purses at risk, compromising the reputation of BC gaming facies unnecessarily." B. Review Terms of Reference and Process In oummary, | have been requested by the Ministry of Finance t indaperdety vw Catan aspects ofthe operations of te Horse Racing Unit (HU), and specially to + evaluate the business and investigation practices ofthe HRU; and * conduct a sample fe review to ensure that investigative practioes end delegated whether or not partial suspensions should be Imposed n certain Grcumstances. There's aso the issue of the need for consistency in the determination of sanctions in respect ot licensees being tested postive for drugs, ‘Concern is expressed that there is @ potential Ss ‘A further Issue isthe Director of Horse Racing's decision that he should adjucicate, prior to Judges Hearing, an informal request from the licensee to continue his empioy inthe bbackstretch, albeit for one day, as ‘This had the potential of compromising any future icensee appeal process. 2 Incident ¢ E3(e) Circumstance my ‘Arace horse competing at Hastings Park, Vancouver, on __ 2016, Was selected for ® drug test. The test results received from the Canadian Pari Mtl Agency (CPMA) laboratory on or about revealed that the horse tested positve-for the drug A subsequent barn search found no traces of the drug, In addition tothe bam search, a number of track licensees who may have handled the ‘horse at various times were crug tasted. None ofthe licensees tested positive for However, one trainer tested positive for ‘and four other licensees tested ostve for: Within the 45-day permission period, the trainer requested a spit sample of the horse test for verification. The results, when received from the United States lab, were again positive for. The trainer then asked for a quantitative test analysis, was not unt 22036 that a Stewards Hearing was held and the trainer then ‘suspended from/racing and denied acoess to the race track premises for 30 days. The ‘suspension was subsequently upheld on appeal to the Director of Horse Racing. ‘The Stewards determined that there should be no sanctioning of the licensees testing Positive for a the drug testing of licensees should have been Festrited totesting for, forthepurpase.of determining the souree.ofthe. found iThe positivetested horse. As well, they did not went to direct attention away from the issue of there having been a poskve test ofa horse. Given the considerable passage of time since the licensees were tested, the Director: ata. meeting with the ‘Stewards following the conclusion ofthe Stewards’ decision — “andrationale. ‘The positive horse tests entered in the Stewards’ notebook and into the Gaming Online Service. Notes pertaining to the licensee postive tests were also entered ito the Gaming Oniine Service. E3(b) Review Findinas, Yam advised that isnot a drug used to improve race horse performance. Consequently, ahorse testing positive for likely due to “cross-contamination’ ~ ‘contamination caused by the horse being in close contact with a person with meth in their system. ‘Arica track licensee may be drug tested at any ime wile atthe track, Such testing may be forall banned crugs or for a specifi banned drug. Gonsequentiy, in respect of ths incident, forthe Stewards to determine that licensees, testing postive for banned substances, should not be subject to sanctioning appears to be a decision that Is notin _acoordance wilh established sanctioning poli. F. Eurther Allegations Itis alleged by the informant that some or al ofthe information regarcing the positive tesis referred toby the informant may have been witnheld from the Service Provider, GCGC. To my knowledge, in respect of all positive drug tests other than regarding Incident A above, a GCC representative has been advised of the tests and their isposition. Inthe case of Incident A, a GCGC representative was advised oniy of the warning given to the licensee. {tis also alleged that the incidents cited may not be the only examples of tolerance for Inaividuals under the ifiuence of lit drugs maintaining active horse racing licences. However, ng further examples of such tolerance have come to my attention during the, course of thigreview. Its further alleged by the informant that there is no oversight with regard to decisions made by the Director of Racing andlor results in general with regard to horse recing issues. This allegation wil be discussed in the Part 2 Report of my review, in that it pertains tothe sufficiency of reporting by, and accountability o, the HRU. G, Service Provider's Internal Investigation On £2016, the horse racing Service Provider, Great Canadian Gaming Corporation (GCC), recived a copy of Mr. Eby’ letter of the eame dete, A GCOS Investigator immediately commenced an Intomal investigation and determined that, in regard to the incidents cited in the letter, there was no evidenoe of any licensed GEGC ‘employees being in contravention ofthe provisions of the corporation's Employee Handbook or Code of Conduct H. Revewer's Assessment of Incident and Allegation Findings |am satisfied thet, to a considerable degree, Gest Dogaions made by the infomantare legitimate. The queston then fs wheter is inedents set oui the allegations suggest that there Is & conceming pattern of breach of process bythe Director of Horse Racing in dealing with postive cr tes. {In respect ofthe three Incidents discussed above, | am satisfied, from the information ‘and documentation I have received, thatthe Executive Director, Compliance Division, hhad no knowlecge of any of the incidents union 2016, he received an ‘email from the Manager, Horse lacing Investigations, concerning one of the drug testing Incidents. On the same date, the GPEB Senior Director, Lower Malnland, advised the Executive Director, Compliance Division, that eater in had received correspondence {rom the Manager, Horse Facing Investigations, and wanted to speak to him to get more information before dealing further with his issues. From that date forward, the*Executive Director, Compliance Division, pursued several iniatives forthe purpose of establishing {an independent investigation ofthe allegations. | am also satisfied, from the information and documentation Ihave received, thatthe: GPEB General Manager had no knowledge of any of the Incidents unt, on 2018 he received, trom the Executive Director, Compliance Division, a briefing that included a report on actions being taken that included an independent investigation of ‘the allegations, . la “Geerge Ment FOPA, FA Attachment: Letter dated November 3, 2016 frin Mr, D: Eby, MLA, to Minister of Finance, M. de Jong 10 Appendix Letter received from MILA Eby dated November 3, 2016 ae 206 Meier ne Motarathaance Was: isis Deane on: eGo Pl Eecerer anh (GPE Ho ae Danton cami sconce cree gered Gang wher om tr Doon ace Tc [eh wards erat cues at th Going Pa Elemento el oye stew vanceue par hrm allege ac ot ih 0 Mia rou, Dee 2 GPR nd {Stitt eo Orecin Clans or snr oes onthe ates ‘oupane nba prose bane eg ence gpl eng th ein + Anidstornaias aed concaingtneesdel peste 2016s ‘wer snl ho ua prema cams operingbeatyequomer te ack sndvasrt spend 1+ nnd ona) prmitin sn inks vhotntedpstiefor on ‘ilteconinoe een tne wate eae cttw acme 248 2okanesforanoendd pr ete pastor opto aig 2016 08, + Fallownthepostnetestolahoaetamathonghtanioeen et adugizes ‘nperetzehreplormsc] ea tcontameatony roms ude ene ’ tlt wer steed oe ed pot or footed pater “aedthur der nape ‘The es pibig et dguse by hese wth Gre cnt bho ent maketh foe {pod Ths asp dna st adton fang a eae itera ety corer cura eee puny path oe Sngroostbo ce an hanesnd rete eke on contaminate ‘Sonor ata compromising tu roparin opening tose ‘fran seta he banat tne at eve roe oath de "anesthe ese cue Wa te od ds rox ‘i emgoyed bn wh we poe atc nance Ti ene ers me ‘alert oma sb posters my hw ened ee mee we ‘lloras so aes tt rae bin sha hss may abe cea ‘abranernuatheiene of a gs maanng ato he ee {rpc ies a ys dy on erigaon deen imi aey ntact ach aetna yan bean ‘Stes am ater at teres ema cuts ss ate en ede eng owns a ele sae Dn ‘Tho etn aoe your eget ttn ota vent, og ‘ty Considerations Relating to the Horse Racing Unit, Compliance Division, Gaming Policy and Enforcement Branch, Ministry of Finance, Government of British Columbia Part 2: Evaluation of Certain of the Policies, Procedures and Practices of the Horse Racing Unit, Gaming Policy and Enforcement Branch Report by George L. Morfitt, FCPA, FCA To Cheryl Wenezenki-Yoltand, Associate Deputy Minister, Ministry of Finance, Government of British Columbia January 31, 2017 CODEN Do Neb cop copys ‘TABLE OF CONTENTS 1A. REVIEW TERMS OF REFERENCE AND PROCESS ‘At Part 2 Repor on Horse Racing Unt Operations GAMING POLICY AND ENFORCEMENT BRANCH HORSE RAGING UNI: GBEB COMPLIANCE DIVISION: : 9 ). OVERALL INTEGRITY OF HORSE RACING HORSE RACING UNIT DRUG TESTING AND SANCTIONING PROCESS 4 Dug Te 2 The Watfor Dnug Test Results £9 Positive Dnug Test Procass: Director of Horse Racing Role 4 Publicizing of Licensee Sanctions E55 Review of Diug Testing and Sanctioning Policies INSPECTIONS AND INVESTIGATIONS Protocol for Investigations @. SECURITY OF CONFIDENTIAL INFORMATION AND OF PREMISES H. PERSONNEL QUALIFICATIONS AND EXPERTISE |. OVERSIGHT OF HORSE RACING UNIT OPERATIONS J. RECORDS MANAGEMENT K. LIOENSEE CONSIDERATIONS ‘1 Communication with Licensees K2 Counselling of Cartan Sanctioned Licensees L HORSE RACING UNIT OVERALL PERFORMANCE ‘Acronyms Goa Gaming Contro! Act Province of British Columbia GCGC Great Canadian Gaming Corporation GPEB Gaming Policy and Enforcement Branco RU Horse Racing Unit, GPEB Compliance Division rs 10 " " 2 ‘A. REVIEW TERUS OF REFERENCE AND PROCESS: \n summary, | have been requested by the Ministry of Finance to independently review certain aspects ofthe operations of the Horse Racing Unit (HAL) situated within the Gaming Policy and Enforcement Branch (GPEB), and specifically to: * evaluate the business and investigation practices of the HRU; and * conduct a sample fle review to ensure that investigative practices and delegated Under the provisions of Chapter 3, Part 1 ofthe ules of Thoroughbred & Standarabrei Horse Racing, tre Stewards/Judges have comprehensive responsibilty forthe proper Conduct of race meetings, This responsibility extends to having “control and jurtsletion (over al matters arising out of a race meeting whether the matters arise before, during, or after the end of the race meeting” In respect of the disciplinary powers of Judges/Stewards, Chapter 8 provides for theit ‘conduct of investigations and imposition of penalies against licensees, They are.to Investigate promptly and render a decision in respect to every protest, objection, ‘complaint, or dispute made to them, and they may Impose any ofa variety of penalties set out in the rules, ‘The Judges/Stewards currently have three Inspectors to assist them in carrying out theie Inspections. On completion of an inspection, the Judges/Stewerds determine, in discussion with Inspectors, whether or not a particular matter should be reported to the Manager, Horse Racing investigations. Upon the completion of any required - =~” investigation, and after due process usually Involving 2 licensee Hearing, the

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