Philippine Central Bank Pushes for Tighter Oversight of Casino Junkets

The Bangko Sentral ng Pilipinas (BSP) is intensifying its push for stricter regulation of casino junket operators, citing elevated money-laundering risks tied to the sector’s opaque transaction structures. The central bank has urged authorities to enforce deeper customer verification and continuous monitoring of financial flows linked to these intermediaries.

Deputy Governor Lyn Javier warned that transactions involving casino junket operators present significant exposure to illicit finance. “Financial transactions linked to CJOs can pose elevated money laundering risks,” she said. Javier noted that the BSP is identifying best practices and red flags for BSFIs (BSP-supervised financial institutions) to watch for, but declined to elaborate on the specific operational concerns flagged by regulators.

Beyond transaction monitoring, the BSP raised concerns about oversight by boards and senior management regarding anti-money laundering and counter-terrorism financing programs. It called for improvements in client acceptance procedures, ongoing transaction surveillance, suspicious-reporting mechanisms, and internal training. The bank also recommended that BSFIs maintain enhanced due diligence for high-risk clients, automate transaction monitoring, conduct client link analysis, and participate in shared data initiatives to strengthen enforcement.

These calls come as the Philippines continues reshaping its gambling landscape following President Ferdinand Marcos Jr.’s July 2024 ban on Philippine Offshore Gaming Operators (POGOs). The president linked POGOs to criminal activities including financial scams, money laundering, human trafficking, and murder, and set a year-end 2024 deadline for their closure. Authorities now claim that no official or illegal POGOs remain, signaling a successful crackdown.

However, a recent United Nations report warned of persistent “Guerrilla POGO” operations that evade detection by operating from residential condominiums in small, mobile units. The report raises questions about the effectiveness of the Philippine Amusement and Gaming Corporation (PAGCOR) in curbing illegal gambling despite stringent policies.