Philippines Senate Committee Calls For POGO Shutdown, Regulator Reboot

September 21, 2023
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A joint Philippine Senate committee has recommended shutting down foreign-facing online gambling operators (POGOs) in a report that passed by a bare majority.
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A joint Philippine Senate committee has recommended shutting down foreign-facing online gambling operators (POGOs) in a report that passed by a bare majority.

The 120-page report calls for a Senate resolution to not only discontinue POGO licensing, but also legislate to establish a new gambling regulator and restrict existing regulator PAGCOR to gambling operations.

The report demands a Bureau of Internal Revenue (BIR) crackdown on tax-delinquent POGO licensees and service providers, as well as on PAGCOR’s outsourced online gambling auditor Global ComRCI, which is under investigation for corruption.

The majority of the joint committee are also pushing for deportation of Chinese nationals and other foreigners working for POGOs and related services.

“It is clear from the data that we have gathered in recent months that criminals are using the POGOs for human trafficking and [operation] of cryptocurrency and love scams,” said Senator Sherwin Gatchalian, a joint committee chair and head of the ways and means committee.

Other recommendations include a full Senate probe into the Global ComRCI contract and job-placement assistance for Filipinos who lose POGO employment, possibly elsewhere in the information technology sector.

Gatchalian and his committee co-chair, public order and dangerous drugs committee head Ronald “Bato” Dela Rosa, both signed the report, along with eight names out of a total 18 members, giving the report a bare majority and sending it to the Senate floor.

“This is an important step in stopping the spread of crime emanating from POGO companies,” Gatchalian said in Tagalog in a Senate press release on Wednesday (September 20).

“We hope to achieve our goal of maintaining order in the country, which will lead to the growth of our economy.”

The passage of the report provides anti-gambling forces with a degree of momentum as community and politician anger builds over POGO links to companies that enslaved thousands of Filipinos and foreigners in greater Manila and Clark Freeport.

Fallout for domestic-facing online gambling operators (PIGOs), which are also regulated by PAGCOR but have radically different licensing conditions, could follow.

On the report’s signatory page, anti-gambling Senator Raffy Tulfo wrote in his own handwriting that he will seek to “amend to include PIGO and other forms of online gaming” in any Senate resolution.

Co-signatory and leading anti-gambling Senator Risa Hontiveros also praised the report.

Hontiveros, who helped to expose the “pastillas scam”, in which POGO-linked labour brokers fully infiltrated the immigration bureaucracy at Manila’s Ninoy Aquino International Airport, lamented POGO impacts on women in particular.

“For almost three years now, I have been calling for POGOs to be kicked out of the country,” she said.

“We ourselves in the Senate committee on women have investigated their involvement in prostitution, corruption, especially in the ‘pastillas scam’, human trafficking and recently, that POGOs are also being equipped as legal cover for scam hubs,” she said.

“So we fully support Senator Sherwin Gatchalian in the committee report to ban POGOs forever.

“I have always believed that a total ban on POGO is right and just … If we got anything out of [POGO revenue], it was nothing compared to the disaster they have caused. No one will regret it when we drive them out, finally,” she said.

The report’s release coincides with a PAGCOR initiative to re-license POGOs after months of intense criticism over raided operations, tax avoidance and associated criminal activity.

PAGCOR chairman and CEO Alejandro Tengco confirmed last week at an industry event in Manila that the review of licensees will be complete within weeks.

But hostility to POGOs across government has grown, with the Office of the President's Anti-Organised Crime Commission weighing in this week, warning that POGO-linked cybercrime, such as online scams, pose a greater threat to public order than drug abuse.

The Senate report contains considerable data on POGO and PAGCOR revenue and employment metrics unavailable elsewhere, as well as tabular data on associated crime.

One section of the report depicts senators travelling across Manila attempting and failing to verify the credentials and whereabouts of third-party online gambling auditor Global ComRCI, including being refused entry three times at a purported operations centre by security guards.

The outsourced auditor, which received millions of dollars for its work, was savaged in the report for lack of business documentation, impaired bidding documents and shoddy performance, among other problems.

The report also states that the primary market for the POGO industry is illegal online gambling in China, therefore violating PAGCOR’s POGO charter.

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