Registrar, Alcohol and Gaming Commission of Ontario v. Marc Blain, 2008 CanLII 91841

ALCOHOL AND GAMING COMMISSION OF ONTARIO

IN THE MATTER OF The: Gaming Control Act, 1992, as amended

B E T W E E N:

Registrar, Alcohol and Gaming Commission of Ontario

Registrar

-and-

Marc Blain

Registrant

DECISION

Panel: David C. Gavsie, Chair, AGCO

Jacqueline Castel, Board Member

Guy Maurice, Board Member

Decision Date: July 11, 2008

Hearing Location: Thorold, Ontario

Alcohol and Gaming Commission of Ontario

90 Sheppard Avenue East, Suite 300

Toronto ON M2N 0A4

Phone: (416) 326-0366 Fax: (416) 326-5566

Toll Free In Ontario: 1-800-522-2876

Website: www.agco.on.ca

Appearances

Registrar, Alcohol and Gaming Commission ) Bryna Kaplan, Representative

Marc Blain, Registrant )

AUTHORITIES

Schellenberg (Re) an unreported decision of the AGCO, April 27, 2000, File No. 42783

Allegations

1. A hearing into Notice of Proposed Order (“NOPO”) dated March 27, 2008, file number 151962, to refuse the registration of MARC BLAIN, 96 Strada Boulevard, St. Catharines, Ontario, L2S 3K7, registration number 141122, as a gaming assistant, in the class of gaming employee, on the basis of that he is not entitled to registration under section 11 of the Gaming Control Act (“GCA”), was held on June 18, 2008, in the City of Thorold.

Decision

2. After considering all the evidence and submissions, the Board CONFIRMS the Registrar’s NOPO refusing the registration of Mr. Blain as a gaming assistant. Reasons follow.

Preliminary Matters

3. Mr. Blain requested, on the Gaming Hearing Request Form, that the hearing be conducted in French. The Hearings Department arranged for an interpreter, Mr. Martin Miville, to translate at the hearing. When Mr. Blain did not attend by 9:46 a.m., the Board excused Mr. Miville as the services of an interpreter were no longer required.

4. Given that Mr. Blain did not attend the hearing, Ms Kaplan submitted that the matter could proceed in one of two ways.

1. The Registrar could withdraw the NOPO, since Fallsview Casino Resort withdrew its conditional offer of employment to Mr. Blain. Ms Kaplan informed the Board that the Registrar was only informed of same on May 14, 2008, after the NOPO had already been served. If Mr. Blain receives another conditional offer of employment from a casino or slot facility, the Registrar would revive the NOPO.

2. The Board could hear the matter ex parte. If the Board sets aside the NOPO, Mr. Blain would have thirty days to obtain an offer of employment from a casino or slot facility.

The Board indicated it would hear submissions on proceeding ex parte.

5. A Notice of Hearing dated May 14, 2008, with the date and location of the hearing, was sent to Mr. Blain by registered mail on May 15, 2008. A copy of the Notice of Hearing and Affidavit of Service, signed by Ms Kristina Krause and dated June 8, 2008, were introduced as Exhibit 1. Mr. Blain’s request that this hearing be adjourned was denied by correspondence dated June 2, 2008, which was introduced as Exhibit 2. On the basis of these two exhibits, Ms Kaplan submitted that Mr. Blain had received notice of the hearing in accordance with the Board’s Rules of Practice. Accordingly, the Board ORDERED the matter to proceed ex parte.

6. Mr. Blain was notified, by correspondence dated December 17, 2007, from Ms Colleen Falco, Organisational Development and Learning Manager, Fallsview Casino Resort, that his conditional offer of employment as a dealer at Fallsview Casino Resort was being withdrawn because he failed to obtain a gaming employee registration within eight weeks of the offer. A copy of this correspondence was introduced as Exhibit 3.

7. The Registrar’s Book of Documents, which was sent by courier to Mr. Blain on June 12, 2008, was introduced as Exhibit 4. Ms Kaplan noted that Mr. Blain would have seen or been aware of the information in all of the documents in the Registrar’s Book of Documents before June 12, 2008.

Registrar’s Evidence

8. James Renwick, an Investigator with the AGCO since 2000 and previously a member of the OPP for thirty-two years, indicated that as a civilian investigator for the AGCO he is responsible for conducting background investigations on applicants for registration and renewal. This involves interviewing applicants and witnesses, obtaining and reviewing documents related to the application, and writing a report on the findings of the investigation. Mr. Renwick was asked to conduct a background investigation on Mr. Blain on November 20, 2007, when the preliminary review conducted by the AGCO’s Niagara Falls Office revealed concerns about Mr. Blain’s financial history. Mr. Renwick conducted two personal interviews of Mr. Blain, secured various documents relating to his application, and prepared a report on his findings for the Registrar, dated December 12, 2007.

9. Mr. Renwick performed an Equifax search of Mr. Blain on November 23, 2007. The Equifax search, which is found at Tab 5 of the Registrar’s Book of Documents, revealed that Mr. Blain filed for bankruptcy twice, once in 2003 and again in 2006. The 2006 proceeding is still on-going. Mr. Renwick was informed on June 17, 2008, by Ms Johanne Brassard, a clerk employed at Raymond Chabot Inc., the Bankruptcy Trustee, that payment of $215 is still required before the 2006 bankruptcy will be discharged. Mr. Renwick also performed an insolvency search of Mr. Blain’s spouse, Ms Nathaly Tremblay. The search revealed that Ms Tremblay has filed for bankruptcy on three separate occasions. All three bankruptcies have been discharged.

10. Mr. Renwick interviewed Mr. Blain for the first time on November 29, 2007, at the AGCO’s Niagara Falls office. Mr. Renwick had requested that Ms Tremblay also attend the interview but she declined. When asked why Ms Tremblay did not attend, Mr. Blain told Mr. Renwick that “she does not have to come to talk about her past or personal information.” Mr. Blain indicated at the interview that he is employed as a letter carrier by Canada Post earning a base annual salary of $55,000. Ms Tremblay does not work because of an illness. Mr. Renwick stated that Mr. Blain was very vague and evasive in his responses to questions about his financial history. He did not provide an explanation for his financial difficulties. After approximately thirty or forty minutes, Mr. Blain said he was leaving, even though Mr. Renwick told him he had not completed the interview.

11. Mr. Renwick interviewed Mr. Blain again on December 5, 2007. Mr. Blain told Mr. Renwick that he contacted the Niagara Credit Council for assistance and guidance in managing his financial affairs, on the recommendation of AGCO Investigator Duguid. However, the Niagara Credit Council told him it would only assist him once all outstanding obligations relating to his 2006 bankruptcy had been fulfilled. When Mr. Renwick asked him about seven outstanding collection claims totalling $4,311, Mr. Blain initially said he was unaware of four of the claims, but then corrected himself, stating he must have forgotten about them. Mr. Blain also told Mr. Renwick that he has not made any payments on an outstanding judgment for $5,828 to Carfinco Ltd., a Quebec based vehicle finance company. Mr. Blain stated the company would not accept his proposal to pay monthly instalments of $100, and he could not afford the company’s proposal of $400 monthly payments. At the time of the interview, he had not made any payments on this judgment.

12. Mr. Renwick asked Mr. Blain at the December 5, 2007, interview whether an Equifax search performed in thirty days would reveal any new judgments. Mr. Blain told Mr. Renwick he didn’t know. Mr. Renwick performed additional Equifax searches on May 8, and June 2, 2008. The June 2, 2008, Equifax search revealed two new unpaid collection matters, one to BMO Langford for $1,300, and another to Instarent for $3,936.

13. Mr. Blain responded “no” to question 8 on the Application for Registration form, which asked whether he ever held an ownership interest in or had meaningful authority over a sole proprietorship, partnership, corporation or other business entity in any jurisdiction. Mr. Renwick told Mr. Blain that a corporate search revealed he owned and operated a delivery business named Marc Blain ENR between May 2001 and March 2002. Mr. Blain said he forgot about the business and was not trying to mislead the Registrar.

14. In response to a question from the Board, Mr. Renwick stated that Mr. Blain spoke English well and there was no language barrier during the interviews.

15. Jeff Longhurst, Deputy Registrar and Manager of Gaming Registration, stated that Mr. Blain’s application first came to his attention when Ms Lori Lyons, a Gaming Registration Officer in the AGCO’s Niagara Falls Office, sent him a note outlining concerns about Mr. Blain’s past conduct. Mr. Longhurst agreed with the concerns, which were primarily related to Mr. Blain’s financial history, and asked for a follow-up investigation to be conducted. Mr. Longhurst reviewed the file after the follow-up work was completed and, at this time, had even more serious concerns about Mr. Blain’s suitability for registration. Accordingly, Mr. Longhurst asked the AGCO’s Legal Department to prepare a NOPO to refuse Mr. Blain’s application for registration as a gaming assistant.

16. Mr. Longhurst indicated that when there are financial concerns about a gaming assistant he will often approve the registration subject to compliance with terms and conditions which would enable him to monitor the individual’s conduct. He did not consider approving Mr. Blain’s registration with terms and conditions because of the extended pattern of financial difficulties, as evidenced by two bankruptcies, seven additional collection matters, late payments on his vehicle and an outstanding judgment. Mr. Blain has not found his way out of his debt situation, and his past financial conduct does not reveal any evidence of improvement.

17. Mr. Longhurst summarized the items which Mr. Blain failed to disclose or accurately report on the application for registration as a gaming employee form:

• As noted by Mr. Renwick, in response to question 8, Mr. Blain did not disclose that he owned and operated a delivery business in Quebec.

• In response to question 10(a), which asks whether the applicant, or any business with which the applicant was associated, has ever been found guilty or convicted of an offence in any jurisdiction, Mr. Blain responded, “No”. After the question, the text of the application reads: “Note: This includes offences under any jurisdiction including criminal offences and other federal offences, driving offences, liquor offences and other provincial or similar offences.” An investigative search revealed that Mr. Blain had two convictions registered against him under the Highway Traffic Act in Alberta for speeding, one in 2006 and the other in 2007.

• In response to Question 12(a), which asks whether the applicant, or any business entity with which the applicant is associated, has ever applied for any permit, licence, certificate or registration in connection with gaming in any jurisdiction, Mr. Blain responded “no”. In fact, Mr. Blain held a gaming license in both Alberta and Quebec. In response to Question 7(b), however, Mr. Blain did disclose that he was employed as a dealer at two different casinos in Calgary in 2006.

• In response to question 13(a) which asks whether the applicant has ever filed under bankruptcy, been petitioned into bankruptcy or made a proposal under any bankruptcy or insolvency law in any jurisdiction, including additional specified information where the answer is affirmative, Mr. Blain only attached particulars regarding the 2006 bankruptcy. He did not disclose the 2003 bankruptcy.

18. When asked to explain when financial irresponsibility becomes an honesty and integrity issue, Mr. Longhurst stated that of all the applications he has reviewed over the years, this one contained some of the most serious financial concerns he has ever seen on a gaming assistant application. Mr. Blain breached loan agreements and other financial obligations over an extended period of time. He provided no explanation for his financial conduct. Mr. Longhurst indicated he sees many cases where an applicant files for bankruptcy, but subsequently organises his or her financial affairs in a responsible manner. In such a case, where there is evidence that the applicant has corrected his past problems, it would not necessarily be detrimental to his application as a gaming assistant. However, in this case, there was no evidence whatsoever that Mr. Blain would behave in a financially responsible manner in the future.

Registrar’s Submissions

19. Ms Kaplan submitted that Mr. Blain’s financial irresponsibility demonstrates a lack of honesty and integrity, a failure to comply with the law, and a failure to act in the public interest. Mr. Blain has demonstrated a complete disregard for his financial obligations. When an applicant does not learn from his financial mistakes of the past and continues to use bankruptcies to erase debts, it calls to question the applicant’s honesty, integrity, and ability to work within the law. Mr. Blain did not provide any explanation for his financial problems, when given an opportunity to do so during the two personal interviews. What is more, his financial problems are ongoing. He still has not been discharged from is 2006 bankruptcy, and he has acquired more debt.

20. Ms Kaplan also noted that Mr. Blain’s disregard for the commitments he makes is not only apparent in his financial affairs. It was also apparent in the fact that he requested a hearing, but then did not attend the hearing, even though he received notice of it. We don’t know why Mr. Blain failed to respond to all of the questions on the application form honestly or correctly, but this too may be another symptom of his disregard for legal requirements and authority.

21. Gaming is a cash-intensive industry which places high standards on registrants to act with honesty and integrity. Ms Kaplan submitted that Mr. Blain does not meet the requisite standards of honesty and integrity and asked the panel to uphold the Deputy Registrar’s NOPO refusing Mr. Blain’s registration as a gaming assistant in the class of gaming employee.

Analysis/Reasons/Findings

22. Lack of financial responsibility is not an enumerated statutory criterion for refusing a gaming assistant’s registration under section 11 of the GCA. In contrast, lack of financial responsibility is an enumerated criterion for refusing a supplier’s registration under section 10(a). Therefore, in order to rely on past financial conduct to refuse a gaming assistant’s application, there is a higher standard than there is for suppliers; for gaming assistants, the lack of financial responsibility must be directly related to concerns about the applicant’s ability to act with integrity, honesty, in accordance with the law, and/or in the public interest. For instance, in Schellenberg (Re) (unreported, April 27, 2000, A.G.C.O., File No. 42783), the Board found that Mr. Schellenberg’s writing of NSF cheques and history of defaults in payments displayed conduct lacking in honesty and integrity, and on this basis, the Board confirmed the Registrar's NOPO refusing Mr. Schellenberg's application for registration as a gaming assistant, in the class of gaming key employee.

23. In the case of Mr. Blain, the Board finds that the higher standard of relating financial irresponsibility to concerns about the applicant’s ability to act honestly, with integrity, in accordance with the law, and/or in the public interest has been met. Specifically, Mr. Blain’s financial history, which includes two bankruptcies, one of which has yet to be discharged, outstanding collection claims, late payments, and an outstanding judgment against him, demonstrate a lack of honesty and integrity and an unwillingness to comply with lawful financial obligations. When Mr. Blain was given an opportunity to explain his financial problems to the AGCO investigator, he did not bring forward any mitigating or extenuating circumstances. Rather, he was evasive and left the first interview before it was completed. Further, Mr. Blain did not demonstrate that he has learned from his past financial mistakes and changed his ways. Quite to the contrary, there is evidence of new debt, as revealed by the Equifax search conducted by Mr. Renwick as recently as June 2008. This failure to learn from his past mistakes also calls into question his honesty and integrity.

24. Mr. Blain’s failure to respond to four of the questions on the application for registration form honestly or correctly, as well as his evasive manner when interviewed by the AGCO investigator, is also of concern to the Board. The Board regards the application process as a very important part of the procedure for registering applicants under the GCA. It is the applicant’s first contact with the regulatory agency and basic to the formation by the Registrar of a judgment on the applicant’s suitability for registration. Lack of honesty and forthrightness, and/or failure to provide full disclosure in the application process is an indication that the applicant will be difficult to regulate. Since Mr. Blain did not attend the hearing, the Board does not know whether he was deliberately attempting to mislead the Registrar or whether he simply took a careless approach to the completion of the application. In the case of two of the four questions (question 8 on business ownership and question 12(a) on gaming licenses), the Board does not see any reason why Mr. Blain would have intentionally failed to tell the truth. Whether Mr. Blain thought it would be beneficial to his application to hide one of his two bankruptcies and his Highway Traffic Act convictions (not realising that the AGCO verifies the information on the form) is uncertain. At very minimum, Mr. Blain’s failure to answer all of the questions honestly or correctly reveals that he did not take the application process seriously enough.

25. The gaming industry, a cash-intensive business, is highly regulated and predicated on detailed, rigorous rules and internal control procedures governing all aspects of the handling, movement, counting and accounting of money and money equivalents. In addition to these rules and procedures, dealers are expected to adhere to the approved rules of play as well as detailed procedures on game protection. Given the careless, if not dishonest, approach Mr. Blain adopted towards his application form and his long history of disregarding lawful financial obligations, the Board is not satisfied that Mr. Blain, if registered, would observe the onerous rules and procedures which apply to the gaming employees in a casino. Rather, Mr. Blain’s past conduct suggests that he would be ungovernable.

26. Based on Mr. Blain’s failure to meet financial obligations over an extended period of time, his apparent use of bankruptcies to erase debts, coupled with his failure to answer all of the questions on his application form honestly or correctly and his evasive responses to questions posed by the AGCO investigator, the Board FINDS, in accordance with subsection 11(a) of the GCA, that there are reasonable grounds to believe he will not act as a gaming assistant in accordance with the law or with integrity, honesty or in the public interest.

Order

27. For the above reasons, the Board CONFIRMS the NOPO refusing the application of MARC BLAIN, 96 Strada Boulevard, St. Catharines, Ontario, L2S 3K7, registration number 141122, for registration as a gaming assistant having found, in accordance with subsection 11(a) of the GCA, based on the applicant’s past conduct, there are reasonable grounds to believe that he will not act as a gaming assistant in accordance with the law or with integrity, honesty or in the public interest.

DATED AT TORONTO THIS DAY OF , 2008

DAVID C. GAVSIE, CHAIR, AGCO JACQUELINE CASTEL, BOARD MEMBER

GUY MAURICE, BOARD MEMBER

JC/ee