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Philippines Shuts 214 Illegal Online Gambling Operations

FILE - A protester waves a Philippine flag during a rally outside the Department of Foreign Affairs in Manila, Philippines on Friday, June 21, 2019.
FILE - A protester waves a Philippine flag during a rally outside the Department of Foreign Affairs in Manila, Philippines on Friday, June 21, 2019.

Philippine officials say they have shut down at least 214 illegal Chinese offshore gambling operations and deported the first six of nearly 400 Chinese workers who have been detained under a renewed crackdown.

A spate of crimes victimizing Chinese workers at illegal online gambling businesses, including kidnappings and sexual abuses, sparked the crackdown and calls for the banning of even legitimate operators in the lucrative industry.

Called Philippine offshore gaming operators, or POGOs, the Chinese-run gambling firms are based in the Philippines, but their customers are overseas. They began growing rapidly in 2016, generating about 30 billion pesos ($508 million) in gambling revenues and fees from 2016 to this year, officials said.

The current crackdown is directed against Chinese operators who have not paid taxes or revenue shares or have committed other violations of the law. The visas of their estimated 48,000 mostly Chinese workers will be canceled, and they can either leave on their own or face mass deportations, Justice Assistant Secretary Jose Dominic Clavano said by telephone.

“All of these illegal POGOs cannot operate in the country and the people who work for them are violating our laws and we should make sure that they leave our country,” Justice Secretary Jesus Crispin Remulla told reporters at Manila’s international airport, where the six deported Chinese workers boarded a commercial flight on Wednesday back to China.

Beijing has backed the crackdown on online gambling operations, which cater to clients in China despite Beijing's ban on gambling.

“Crimes induced by and associated with POGO not only harm China’s interests and China-Philippines relations, but also hurt the interests of the Philippines,” the Chinese Embassy said in a statement last week.

“It is, therefore, widely believed that social costs of POGO far outweigh its economic benefits to the Philippines in the long run,” the embassy said.

The six deported Chinese were among 372 mostly Chinese workers who have been detained by Philippine authorities starting in September from different offshore gambling sites, Clavano said.

The identities of the other Chinese are still being verified with Chinese authorities in an often-tedious process prior to their deportation, Clavano said.

Remulla said authorities are also checking how many of the more than 48,000 Chinese workers currently remain in the country because some may have left.

More than 200,000 to 300,000 Chinese were believed to have worked in the online gambling operations when the business peaked starting in 2016, boosting real estate, transport and food businesses in cities where they were based. But a considerable number were forced to leave due to sporadic government crackdowns, a more stringent tax law and the coronavirus pandemic, officials said.

Philippine legislators have debated whether to ban the online Chinese gambling industry altogether.

“It is true that they contribute to the coffers, but it comes at significant social costs, which in turn pose a reputational risk that can affect our business and investment climate,” Sen. Grace Poe told a Senate hearing on the issue early this month.