Philippine Government to Investigate Banks over POGO Operations
The Philippine government is set to launch an investigation into the involvement of banks in the operations of Philippine Offshore Gaming Operators (POGOs), following the discovery of suspicious transactions tied to POGO activities. The investigation, suggested by Senator Sherwin Gatchalian, was presented through Senate Resolution No. 1193.
Bank ATMs lined up in a shopping center in the Philippines. (Source: Hub Pages)
LISTEN TO THIS ARTICLE:The investigation, which Sen. Gatchalian presented last week, was prompted by recent revelations that companies linked to Alice Guo, dubbed the "POGO Mayor," sent or received bank transactions amounting to hundreds of millions of Philippine pesos. These funds were allegedly used to support the development of a POGO hub in Bamban, Tarlac, where Guo served as mayor until her term ended in June 2022.
Related: The Philippines Moves Closer to Banning Entire POGO Gaming SegmentDespite financial institutions being required to flag suspicious activity, these transactions reportedly went unreported, prompting scrutiny of the banks' internal controls and their compliance with the Anti-Money Laundering Act. The resolution references the Anti-Money Laundering Act of 2001, which mandates that financial institutions must report any suspicious transactions within five working days.
Gatchalian highlighted that the amount of money moved through Guo's accounts was significantly higher than the financial statements of her companies would suggest. He emphasized that the financial activities of these entities raised questions about the true nature of their operations.
According to the resolution, almost PHP5 billion (US$90 million) were deposited into Guo's bank accounts, as well as those of her associates, since 2018. This surge in cash flow was particularly notable in 2020, when the volume of transactions was described as "highly unusual" and "suspicious."
Gatchalian's resolution stresses the need for financial institutions to be more diligent in monitoring large transactions. The senator pointed out that the failure of banks to flag these large sums of money being transferred through the system is indicative of potential lapses in internal procedures.
He also expressed concern that this lack of reporting could facilitate illicit activities, such as the operation of unauthorized POGO hubs. Given the scale of these transactions, the investigation is expected to focus on the banking sector’s role in ensuring compliance with anti-money laundering regulations.
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Guo, whose real name is Guo Hua Ping, was arrested earlier this month in Indonesia and deported back to the Philippines after fleeing the country during an investigation into her involvement with an illegal POGO hub. She is accused of being actively engaged in the operations of these offshore gaming activities, despite her official role as mayor of Bamban. The ongoing investigation seeks to uncover the extent of her involvement and how she managed to funnel such large sums through the Philippine banking system without raising alarms.
Authorities are also looking into the potential involvement of other high-profile individuals in aiding Guo’s escape. The Philippine News Agency reported that a former Philippine National Police (PNP) chief is under investigation for allegedly accepting bribes from POGO operators to assist Guo in fleeing the country. While these reports have not yet been confirmed, PAGCOR Senior VP for Security Raul Villanueva indicated during a Senate hearing that there are ongoing efforts to validate the claims within the intelligence community.
POGOs have been under heightened scrutiny for the past couple of years, culminating in an announcement by Philippine President Ferdinand Marcos Jr. that he would ban the gaming segment. In his State of the Nation Address in July 2024, the President ordered all POGO operations to close before the beginning of next year.
This decision comes amid concerns about the sector’s links to criminal activities, such as money laundering, and its overall impact on Philippine society. The investigation into banks’ potential involvement in facilitating POGO operations is seen as part of a broader effort to curb illegal gaming activities in the country. President Marcos is expected to sign an executive order banning POGOs before the end of this month.
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