Stolen funds hard to trace — PAGCOR

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Posted on March 16, 2016 11:06:00 PM

THE PHILIPPINES will have difficulty recovering millions of dollars stolen from Bangladesh that went through the local banking system into certain casinos, the Philippine Amusement and Gaming Corporation’s (PAGCOR) top official said.

The allegedly illicit funds remitted to local casinos have already mingled with legitimate accounts, PAGCOR Chairman and Chief Executive Officer Cristino L. Naguiat, Jr. told reporters after a Senate inquiry on Tuesday.

Hindi namin malalaman ‘yan kasi nag-co-mingle na ‘yan with all capital, with all accounts. Ang hirap niyan. (We will not be able to identify the funds because these have already mingled with all accounts. Tracing them will be very difficult),” Mr. Naguiat said.

Julia Bacay-Abad, executive director of the Anti-Money Laundering Council Secretariat, last Tuesday confirmed before the Senate Blue Ribbon Committee that $81 million was wired from the Bangladesh Bank’s account with the United States Federal Reserve to separate accounts -- opened under false names in May last year -- of the Rizal Commercial Banking Corp. (RCBC) branch along Jupiter St. in Makati City on Feb. 5. The funds were withdrawn on Feb. 9 despite a request from Bangladesh’s central bank for RCBC to stop such payments. The funds were subsequently converted into chips used in three casinos, according to earlier news reports.

In Tuesday’s Senate hearing, an official of Bloomberry Resorts Corp. -- which operates Solaire Resort & Casino in Parañaque City -- said $29 million was remitted to the casino account of junket operator Weikang Xu in exchange for “dead chips.”

Such chips are non-cashable, Mr. Naguiat said, citing a hypothetical situation involving $1 million converted into dead chips. “‘Yung non-cashable na $1 million, ang use lang nun ay itaya sa lamesa. Ngayon kapag natalo, sa amin na ‘yun; kapag nanalo we give them cashable chips. (The non-cashable chips worth $1 million are used only for betting. If the holder loses, the money is ours; otherwise, we give them cashable chips for their winnings only).”

PAGCOR has already launched its own investigation into the supposed remittance of the funds to certain accounts with three casinos, which are not covered by the country’s anti-money laundering law.

But Mr. Naguiat conceded that tracing and recovering the money would be difficult.

Kasi naman noong pumasok, Feb. 5 or 9. Nabasa namin sa dyaryo, Feb. 29 na. So, ang dami nang naging transaction, ‘di ba? (The money made its way into the Philipine banking system on Feb. 5 or 9. It was already on Feb. 29 when we read about the news. So, many other transactions had already been made by then, right?).”

“Actually, hindi pa rin kami sigurado kung ‘yun ang mga ‘yun kasi may mga daily remittance. So, whatever amount we assume went in, nilaro ba ito o hindi? Lahat naman nilaro. (Actually, we are not sure yet if those funds we’ve looked at were really part of the illicit funds. Were they used in casino games? It seems they were used.)”

Mr. Naguiat also asked why Mr. Xu would risk losing the money by converting it into casino chips. “Why do you have to take a risk on gambling that money. Hawak mo na... binigay na cash sa iyo, galing na sa bangko. ‘Clean money’ na lahat ‘yan; deemed ‘clean money’ na. (You already have the money in cash, which was cleared by the bank. That is already deemed ‘clean’).”

Senator Sergio R. Osmeña III, however, believes the recipients of the stolen funds could have still withdrawn the money remitted to the casinos without having to gamble “because its was not the funds of any junket.”

“Casinos will accept anyone’s money. That’s the main problem. They are the black holes of money launderers,” Mr. Osmeña said in a text message.

Like PAGCOR’s Mr. Naguiat, Senate Blue Ribbon Committee Chairman Teofisto D. Guingona III believes recovering the money illegally transferred from the Bangladesh Bank’s account in the United States would be difficult. Talking to reporters after the committee hearing on Wednesday, Mr. Guingona noted Bangladesh authorities could have been “hoping against hope.”

But Bangladesh Ambassador to the Philippines John Gomes, who attended Tuesday’s hearing, expressed optimism that Bangladesh Bank would recover the $81 million stolen from its account. Asked on Mr. Naguiat’s remarks, Mr. Gomes replied in a text message yesterday: “Let’s see what will happen in the Senate hearing” scheduled today. -- Keith Richard D. Mariano

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