Philippine Casino Sector Under Scrutiny After PHP950 Million Laundering Allegations

Allegations against former officials of the Department of Public Works and Highways have placed the Philippine casino industry at the center of a money laundering scandal. Records obtained by a senator showed that five individuals tied to questionable flood control projects amassed gross gambling losses exceeding PHP950 million across thirteen casinos in Metro Manila, Cebu, and Pampanga. The sheer magnitude of these transactions points more to a laundering mechanism than to simple gambling misfortune.

The Anti-Money Laundering Council has confirmed it will investigate the casinos where the former officials wagered staggering sums. The regulator will examine whether these establishments fulfilled their obligations as covered persons under the law. Since 2017, casinos in the Philippines have been legally required to verify customer identities, maintain transaction records, and report cash dealings of PHP5 million or more. They must also submit suspicious transaction reports whenever behaviors suggest possible laundering. In this case, the scale of the gambling activity linked to individuals under investigation for irregular infrastructure projects presents multiple red flags that should have triggered both monitoring and reporting.

By channeling illicit gains from anomalous contracts into gambling activity, the former officials may have been engaging in the layering and integration stages of laundering. Depositing funds into casino systems, converting them into chips, gambling, and recording losses or cashing out creates a transactional trail that can obscure the true origins of illicit money. The staggering figure of PHP950 million spread across multiple establishments shows how casinos can be misused as conduits for large-scale laundering when oversight mechanisms fail.

Casinos were officially brought under the scope of Republic Act No. 9160, as amended by Republic Act No. 10927, following international pressure in the wake of the 2016 Bangladesh Bank cyber-heist in which stolen funds were laundered through Philippine casinos. This amendment imposed obligations on gambling establishments equivalent to those already in place for banks and other financial institutions. These obligations include customer due diligence, which requires identity verification through government-issued documents, and record-keeping rules that mandate all customer and transaction data be retained for at least five years. Casinos are required to file covered transaction reports for cash dealings exceeding PHP5 million, and suspicious transaction reports whenever activity patterns point to illicit behavior. The Casino Implementing Rules and Regulations, in force since 2017, also require compliance programs, the appointment of compliance officers, and the establishment of internal systems designed to prevent laundering.

The AMLC has authority to impose sanctions on casinos that fail to comply. Penalties range from substantial fines to suspension or revocation of licenses, and in more serious cases, criminal liability applies, with imprisonment of seven to fourteen years and fines amounting to twice the value of the funds in question. Investigators in the flood control project case must now determine whether the casinos filed the required reports and whether their compliance frameworks were strong enough to detect activity of this scale.

The reporting obligations are strict. Casinos must file covered transaction reports within five working days and suspicious transaction reports within twenty-four hours of identifying unusual activity. Failure to meet these deadlines can lead to administrative sanctions. However, enforcement remains a challenge. Gambling establishments manage enormous volumes of cash, which can easily mask illicit flows. Without strong monitoring systems, massive deposits and losses may escape scrutiny. The former officials spread their activities across thirteen casinos, a deliberate move that made it harder for any single venue to recognize the full scale of their gambling.

The AMLC must now assess whether reports were filed, whether warning signs were ignored, and whether proper due diligence was carried out by the casinos involved. Should deficiencies be uncovered, sanctions could extend beyond monetary penalties to reputational harm and license revocations. The case also underscores the importance of inter-agency cooperation, as the funds in question allegedly originated from anomalous public works contracts. The nexus between corruption in infrastructure projects and laundering through casinos reinforces the need for both preventive safeguards and strong punitive action.

The scandal has exposed persistent vulnerabilities in the Philippine anti-money laundering regime. Despite reforms that brought casinos under regulation, the fact that five individuals were able to record losses of nearly PHP1 billion reveals that significant risks remain. The connection between alleged graft and casino laundering illustrates how predicate crimes feed into larger financial crime systems.

For regulators, this case offers a chance to strengthen both oversight and enforcement. For casinos, it stands as a stark reminder that compliance duties cannot be treated as mere box-ticking exercises. Properly implemented, requirements for customer due diligence, record-keeping, and transaction reporting can help detect and disrupt laundering before it escalates. The PHP950 million scandal is a clear warning that neglecting these obligations not only exposes casinos to sanctions but also undermines confidence in the integrity of the Philippine financial system.

By fLEXI tEAM