POGOs complicate anti-money laundering, threaten investment hub

Offshore gambling operators (POGOs) are complicating the Philippines' efforts against money laundering and threaten its ambition to become an investment hub.

The Financial Action Task Force (FATF) has placed Manila under increased monitoring since 2021 due to concerns over money laundering in gaming activities, while China has urged the Philippines to stamp out POGOs, describing them as a 'social ill' that encourages crimes like kidnapping and human trafficking.

Experts warn that the presence of POGOs undermines the country's goal of exiting FATF's gray list and highlights the need for stronger regulation, with senior officials expressing concerns about illegal POGOs run by Chinese companies.

Authorities have canceled licenses for numerous POGOs, with some still operating illegally despite risks to national security and links to transnational crimes; China has assisted in shutting down five POGO hubs and repatriating nearly 1000 Chinese citizens involved in these activities.

The Philippines faces challenges in prosecuting terrorism financing cases and addressing opaque financial operations linked to money laundering from POGOs, while Pagcor suspects many have gone underground despite the number of licensed operators shrinking due to pandemic and tax rules.