Skip to main content

Michael Graydon of Paragon Gaming is pictured on the site where the company plans to build an urban resort featuring a casino next to B.C. Place in Vancouver.Ben Nelms/The Globe and Mail

The B.C. Lottery Corporation says its former chief executive officer has repaid $55,000 in salary after being found in a conflict of interest.

The lottery corporation, in a statement Thursday, said its legal counsel has reached an agreement with Michael Graydon, who left BCLC earlier this year for a position with a gaming company affiliate. A government audit found Mr. Graydon was in a conflict of interest as he switched jobs.

"Under the agreement, BCLC has received full repayment in the amount of $55,171.20, which includes total net salary and holdback Mr. Graydon received from February 4, 2014 until March 31, 2014," the lottery corporation's statement read.

BCLC said it did not request repayment of an additional $30,960 in vacation pay because Mr. Graydon was legally entitled to it.

The government audit found Mr. Graydon was in employment discussions with Paragon Gaming in December 2013 and January 2014. The talks culminated in him resigning from BCLC and accepting a position with PV Hospitality ULC.

Mr. Graydon started work as president of PV Hospitality ULC, a partnership formed by Paragon Gaming and 360 VOX Corp., on Feb. 11, one week after he left BCLC. While his main task is to develop hotels, a conference centre, restaurants and a spa around a revamped Edgewater Casino at BC Place, critics feared his knowledge of the industry would be used toward an expansion of gambling activities.

The government review found no evidence that his new employer benefited from the conflict of interest. Mr. Graydon had apologized for creating a perceived conflict of interest, although he insisted he did not disclose any confidential information or seek any benefits when, as head of BCLC, he negotiated a new position with a gaming company.

The call for repayment was outlined in a July 11 letter sent by a lawyer representing the BCLC to Mr. Graydon. The letter had asked for the money to be repaid within 10 days.

The BCLC is expected to introduce one-year post-employment restrictions as a result of the review.

Paragon has proposed building a $535-million "world-class urban resort" that would feature two hotels, a conference centre, restaurants and shops, and be the new home of the Edgewater Casino. That operation, which Paragon acquired in 2006, currently operates at a nearby site. Paragon had proposed building a significantly bigger casino at the new location, but after a public backlash, the city in 2011 approved relocating the casino but ruled out expanded gambling operations.

With files from Globe staff