The Philippine Amusement and Gaming Corp (PAGCOR) has directed all licensed casino operators and gaming support service providers to immediately review and strengthen their anti-money laundering (AML) and counter-terrorism financing (CTF) frameworks after a sector-wide assessment found the industry remains at high risk for money laundering.
The directive follows PAGCOR’s Casino Sector Risk Assessment covering the 2021-2024 period, which classified the Philippine casino sector as “High Risk” for money laundering and “Medium Risk” for terrorism financing.
Under the advisory, operators must review their existing AML and CTF risk models, update internal risk assessments to align with PAGCOR’s findings, and strengthen customer due diligence, transaction monitoring, source-of-funds verification, sanctions screening and suspicious transaction reporting.
PAGCOR also instructed casino operators to distribute the risk assessment to their boards of directors, senior management, compliance officers, internal audit teams and frontline staff, and to identify any deficiencies in existing controls and implement improvements where necessary.
The regulator said land-based casinos and electronic gaming operations remain vulnerable because they handle large cash transactions and often have limited visibility into customers’ source of funds, particularly in the VIP junket segment.
“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,” PAGCOR’s risk assessment said.
It added that “high-value play, intermediated customer relationships, foreign patronage and complex settlement arrangements can reduce transparency over the source of funds, beneficial ownership and the true person controlling the activity.”
According to PAGCOR, illicit funds entering the casino sector commonly originate from drug trafficking, fraud, estafa, cybercrime, environmental offences and tax evasion.
The regulator said that while the sector was assessed as posing a medium risk for terrorism financing, no confirmed cases involving PAGCOR-licensed entities were identified during the review period. It noted, however, that casinos could still be exposed when funds that have passed through banks, remittance channels, e-money platforms or other intermediaries subsequently enter casino activities.
PAGCOR also directed gaming platform and support service providers to ensure their systems support casino operators’ AML obligations and minimise opportunities to conceal transaction trails.
The regulator will conduct examinations to assess how effectively operators have implemented the updated risk assessment and warned that inadequate compliance could result in administrative sanctions.