Beijing’s planned clampdown on unauthorised money changing in Macau, reported by mainland China media on Monday, “isn’t the first time that authorities have vowed to crack down on similar activities in Macau,” said a Tuesday note from JP Morgan Securities (Asia Pacific) Ltd.
The South China Morning Post said on Monday, citing the Chinese state outlet People’s Daily, that Beijing wanted to interrupt what was termed the “entire industry chain” relating to such illicit exchange of currency in Macau.
It was described as a further step to tackling what was termed illegal gambling, as well as money laundering.
The report said a national-level planning meeting of officials was held to discuss the matter by the Ministry of Public Security in Beijing last week.
JP Morgan analysts DS Kim, Mufan Li, and Selina Li noted that previous clampdowns in Macau had covered: “Illegal UnionPay POS machines, illegal money exchanges in Zhuhai/Macau, numerous accounts on underground banks [and] clampdown in/around the Greater Bay area.”
That was a reference first to Zhuhai, the Guangdong province city next door to Macau, and latterly to the Guangdong-Hong Kong-Macau Greater Bay Area, a Chinese government initiative to integrate the economies of the three places.
JP Morgan added: “We feel the overall tone/initiative,” based in media reports, “is quite similar to those that we’ve seen over the past decade.
“Recall, also, that the Macau authorities have been stepping up efforts to clamp down on these money exchangers since mid- last year… and this seems to us an extension of such initiatives as most of the illegal operators are from mainland China, as per the authorities.”
The reports of a crackdown by the mainland authorities come soon after Macau posted for May casino gross gaming revenue of MOP20.19 billion (US$2.51 billion), the highest monthly tally since January 2020, a period prior to the Covid-19 pandemic.
Last week Macau’s Secretary for Security, Wong Sio Chak, said unauthorised currency changers – sometimes associated with loan sharking – were becoming increasingly “corporatised and professional” in their activities, and a threat to the city’s casinos.
According to People’s Daily, the central government’s view was that those activities and increasing violence, scams and smuggling, had “seriously affected social stability” in the city.
Macau police probed 149 frauds in the first quarter said to be linked to unauthorised money change activity. In 124 cases, the unlicensed traders were allegedly the “crime-doers”, said the first-quarter crime statistics report. Tactics included use of fraudulent bank notes, or promises of money remittance that turned out to be bogus.
