Macau is taking a more stringent approach towards regulating its junket operators, but more action is needed to prevent money laundering, an annual U.S. report found.
The U.S. State Department’s International Narcotics Control Strategy Report said junkets had become a renewed focus of Macau’s Gaming Inspection and Coordination Bureau and as a result the number of licensed promoters has decreased from 225 in 2011 to 110 in 2018.
“The government should continue to strengthen interagency coordination to prevent money laundering in the gaming industry, especially by continuing to encourage smaller junket operators, who have weaker AML controls, to exit the market while encouraging the professional junket operators to further develop their compliance programs,” the report, which was published in March found. “Macau should enhance its ability to support international AML investigations and recovery of assets. Only a handful of money laundering convictions have been obtained in recent years.”
In particular, the report encouraged Macau to cut its large transaction report threshold, which currently stands at $62,640 by $3,000 to bring it into line with international standards.
In the Philippines, the report recognised the government’s significant efforts to implement regulations and boost investigative staff but said continuing shortfalls create deficiencies.
For example, current legislation does not include real estate brokers and dealers in certain high-value items (such as automobiles, arts, and antiques) as covered persons.
“The high single-transaction reporting threshold for gaming transactions ($100,000) and the exclusion of non-cash transactions from reporting requirements and junket operators as covered entities are also deficiencies in the current AML regime,” it said. “Furthermore, proxy gambling by offshore players via telephone or the internet is legal.”
The report found The Philippines lacks administrative and technical capacity.
In Vietnam, the report pointed to the decision to allow locals to gamble as a potential to drive up money laundering risks.