The Philippine Amusement and Gaming Corporation (PAGCOR) has directed licensed gaming operators to review and strengthen their anti-money laundering controls after rating the casino sector’s money-laundering risk as ‘high’.
Under an advisory issued on July 13th, operators must incorporate the findings of PAGCOR’s second Casino Sector Anti-Money Laundering and Counter-Terrorism Financing Risk Assessment into their institutional risk assessments and compliance frameworks.
The assessment, approved by PAGCOR’s board on June 25th, covers the period from 2021 to 2024. It rated the sector’s terrorism-financing risk as ‘medium-high’, despite identifying no confirmed terrorism-financing case involving PAGCOR-regulated casino operations during the review period.
PAGCOR said the high money-laundering rating was driven by cash and value-conversion activities, exposure to high-risk customers and intermediaries, complex operations across multiple channels and inconsistent implementation of controls.
‘The sector remains materially exposed to proceeds from serious predicate crimes, particularly where high-value transactions, cash activity, VIP or junket relationships, electronic gaming, remote channels, or weak controls are present,’ the assessment stated.
Land-based casinos were classified as having high inherent vulnerability due to their scale, cash intensity, foreign patronage and exposure to VIP and junket activity.
Electronic gaming was rated medium-high, with PAGCOR citing its rapid expansion, large customer reach, high transaction frequency, non-face-to-face features and uneven system maturity. Larger licensees generally have stronger systems, while smaller venues may face gaps in customer-level data aggregation, cross-channel monitoring and the timely reconstruction of transactions, the regulator noted.
Operators were instructed to review customer due diligence, source-of-funds checks, transaction monitoring and oversight of VIP, junket, remote and high-value relationships.
PAGCOR warned that a failure to ‘reasonably consider’ the assessment could be taken into account when determining future supervisory or enforcement responses.
