AMLC Flags Risks from Casino Junkets

The Philippine government should strengthen measures to combat money laundering and terrorism financing in the casino sector, the Anti-Money Laundering Council (AMLC) said, citing increased suspicious transactions involving casino junkets.

“The substantial volume and value of suspicious transactions associated with casino junkets underscore the junket system’s inherent vulnerability to money laundering and terrorism financing risks,” the AMLC said in a report.

It said one data set showed there were 3,308 suspicious transaction reports related to casino junket operations from Sept. 21, 2018 to Jan. 18, 2023, with an equivalent value of P17.79 billion.

These reports were filed by covered persons in four industries including commercial banks and land-based casinos, which accounted for 71.58% and 27.66%, respectively, of the total.

“Oddly, the volume of suspicious transaction reports was highest in 2023, notwithstanding the fact that data set 1 only captured the first 18 days of the year,” the AMLC said.

The second data set include 4,110 reports from four integrated casino resorts from December 2021 to September 2022, with a total value of P17.59 billion.

AMLC noted that 2,248 reports were reported by just one casino or 54.7% of the total volume. These were valued at P12.09 billion or 68.8% of the total.

“Out of 4,110 suspicious transaction reports in data set 2, 703 with transaction values totaling P9.6 billion involved at least one junket operator of the four high-risk integrated resorts,” it said.

The AMLC, however, noted that the data used in the report were not an assessment of the full amount of proceeds related to casino junket operations, and the actual volume and value may be larger.

By year of submission, the volume of STRs showed an upward trend starting 2021.

“STRs filed by high-risk integrated resorts echo the need to strengthen the anti-money laundering and countering the financing of terrorism controls in the casino sector,” the AMLC said.

Casino junkets are more commonly known as an organized gaming tour for high-rollers. Casinos and junket operators earn a percentage from the money gambled by junket players during their visit.

Last month, the Financial Action Task Force (FATF) kept the Philippines on its “gray list” of jurisdictions subjected to increased monitoring for “dirty money” risks, urging the country to address deficiencies “as soon as possible.”

The Philippines should ensure that supervisors are using controls to mitigate risks related to casino junkets, the FATF earlier said.

Central bank Governor Felipe M. Medalla has said expect the Philippines to be removed from the FATF’s gray list by January 2024, after missing an earlier deadline.