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China – Macau cracks down on held hand casino cash transactions

By - 12 May 2014

Macau police have carried out a handful of raids in and around casinos in recent weeks, seizing illegal, hand-held payment devices as it cracks down on money laundering in the former Portuguese enclave.

Mobile UnionPay payment devices from the mainland have illegally entered Macau where they are used to usher through unauthorised dealings that are flagged up as domestic transactions, circumnavigating currency laws and avoiding tax.

Politicians in Beijing claim that tens of billions of yuan are being funnelled out of the mainland and into casinos breaking national currency controls on the way.
Karen Tang, a Deutsche Bank analyst pitches the amount of funds obtained illegally through card-swiping come to an estimated US$6bn equating to around 12 per cent of Macau’s annual mass-market chips.

One analyst said: “The growth in payment cards is huge, because of China’s corruption crackdown. Mainland gamblers in Macau don’t want to reveal how much they gamble, so they use cards.”

A Macau government spokesperson said: “UnionPay cards are not allowed to be used in Macau casinos. The recent sporadic cases of individuals carrying mobile machines for swiping payment cards were of a criminal nature and were dealt with by the police.”
Another analyst said: “It’s to circumvent China’s currency controls. Otherwise mainland gamblers cannot get enough money to gamble.”

The crackdown has seen the share price of Macau’s operators tumble.
Union Gaming Group analyst Grant Govertsen said: “Investors are now very jittery. Judging from past experience, it’s often all bark and no bite. The shortening of a visitor’s stay or the stricter use of cash cards won’t necessarily curb the gamblers’ capacity to gamble.”

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