The CNE Casino, part of the Canadian National Exhibition (CNE), is contesting nearly $200,000 in fines for alleged violations of federal anti-money laundering and terrorism financing laws. The CNE, Canada’s largest summer fair, opened on Friday, but the casino is embroiled in legal disputes with the Financial Transactions and Reports Analysis Centre of Canada (Fintrac), the federal agency overseeing money laundering regulations.

The CNE Casino, a temporary, not-for-profit establishment, has been a fixture at the CNE since 1991. It operates alongside various attractions, including amusement rides, food vendors, and live entertainment. Following a compliance review in March, Fintrac identified two violations of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, each carrying a maximum penalty of $100,000. The casino has filed an appeal in Federal Court against these findings.

According to the appeal, the casino was cited for inadequate risk assessment procedures and for failing to conduct a bi-annual effectiveness review of its compliance program. In a notice sent on July 14, just before the CNE opened, Fintrac confirmed the violations but reduced the penalties by $1,000 each.

"CNE Casino denies that it has committed any violation of the (proceeds of crime act) or its Regulations," the casino stated in its appeal. It also expressed concern over receiving the maximum financial penalty. Gary Bostock, the casino's director, emphasized that the casino remains fully operational during the fair and is committed to compliance. "There has never been any allegation of criminal activity at the CNE Casino in this process. We are in full compliance with all regulations and are committed to operating a safe, legal, and efficient business that benefits our charitable Foundation," Bostock said.

Lori Blair, a communications advisor with Fintrac, declined to comment on the case, citing its status in Federal Court. The casino's appeal indicates that one violation pertains to how staff report high-risk transactions, while the other relates to the lack of a two-year effectiveness review.

The appeal criticizes Fintrac's decision-making process, stating that the reasons provided were insufficient for understanding the basis of the violations. The casino argues that the director's explanations were vague and did not clarify which procedures were outdated or which regulatory requirements were unmet. "The ‘reasons’ they purport to set out are opaque to the point of unintelligibility," the appeal states.

The casino also claims that Fintrac overlooked its detailed response to the violation notices, which included evidence of its policies and procedures for identifying and mitigating risks. Although the casino acknowledged on its Fintrac questionnaire that it had not conducted a two-year review, it contends that its seasonal operations necessitate annual reviews instead.

Fintrac has stated that the fines are intended to encourage compliance and reflect the harm caused, while also considering the casino's compliance history. The agency described the CNE Casino as a well-resourced entity capable of paying the penalties but granted a small reduction due to the casino addressing the violations. The casino argues that these are its first violations and that first-time penalties should be reduced by two-thirds, according to Fintrac's practices.

The CNE Casino is licensed by the Alcohol and Gaming Commission of Ontario. Unlike regular casinos, its proceeds support a charitable foundation, and it is limited to offering table games with maximum bets capped at $300. The CNE, known as The Ex, attracts approximately 1.5 million visitors each summer and is recognized as Canada’s largest community event. The casino operates seasonally, opening about a month before the CNE and closing at the end of the fair on Labour Day, featuring games such as Blackjack, Mini Baccarat, Roulette, and Texas Hold’Em Poker.