The value of detected retail transactions in Macau using alleged unregistered China UnionPay Co Ltd handheld terminals amounted to approximately MOP4.995 billion (US$625.5 million) for the whole of 2016, the city’s Judiciary Police told GGRAsia.
Throughout the year, the force opened a total of 25 investigations into cases involving alleged unregistered UnionPay handheld terminals. Of those, 20 were passed as cases to the Public Prosecutions Office for further action. Five investigations were not passed to prosecutors as cases, due to “lack of evidence”, the Judiciary Police stated in a written reply.
The police identified 53 suspects as part of the investigations: 14 were from Macau; 38 were from mainland China and one suspect was from Hong Kong.
The police did not disclose information regarding the number of illegally-modified handheld terminals seized. Such devices, also known as point of sale (POS) units, can allegedly be tampered with in such a way that the UnionPay network identifies them as being registered and operated in mainland China, where transaction fees charged by the China UnionPay system are much lower than in Macau.
“In recent years, several pawnshops and jewellery shops here have used the [modified] mainland Chinese UnionPay POS units to offer clients access to cash withdrawal services, with the aim of lowering their own operation costs and enhancing profits,” the Judiciary Police told GGRAsia.
“From what we understood, the money that these clients withdrew [via modified POS units] was mostly for gambling,” the police added.
Macau’s casino gross gaming revenue for 2016 was equivalent to US$27.9 billion. The US$626-million rogue UnionPay transaction figure mentioned by the police is equal to 2.2 percent of the 2016 gambling gross.
Mainland visitors to Macau are only allowed to take a daily limit of RMB20,000 (US$2,985) in cash when crossing the border. Mainland residents gambling in Macau have routinely got around this restriction by purchasing items from one of Macau’s pawnshops or jewellery stores using their UnionPay cards, immediately returning the items in exchange for cash – a process that is not illegal under Macau law. The retailer involved usually charges gamblers a fee under that system.
The value of detected transactions in Macau using alleged unregistered UnionPay handheld terminals amounted to MOP1.22 billion in 2015, Portuguese news agency Lusa had previously reported in January 2016.
In the first half of 2016, such types of transaction were worth an aggregate of MOP2.1 billion, said a follow-up report from Lusa in July last year. Most cases in the first six months of 2016 involved suspected illegal transactions via unregistered UnionPay terminals inside casinos and surrounding areas, stated the news agency.
On January 5, the Judiciary Police and Monetary Authority of Macau jointly conducted raids against the suspected use of illegally-modified UnionPay terminals. The police detained 23 people – connected to eight shops – suspected of committing computer fraud and being involved in organised crime.
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Daniel Boone Wayson
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