Unlicensed foreign-currency exchange (FX) for Macau gambling will be considered a criminal matter if the authorities there deem it is being done as a trade activity, regardless of whether it takes place in or outside casinos.
That is according to Thursday commentary from veteran legislator Chan Chak Mo (pictured), with the latest explanation of the local government’s intention regarding a bill with provisions to criminalise gambling-related unlicensed exchange. Mr Chan heads a Macau Legislative Assembly committee tasked with scrutinising the bill.
The planned legal change can cover transactions for gaming purposes done outside the city’s casino resort complexes, as long as law enforcement bodies were able to gather “sufficient evidence”. He noted at a media briefing on Thursday, that the bill was likely to have its second and final reading at a plenary session of the assembly “within this month”.
The criminalisation aim of the authorities had been announced in August, under article 11 or the draft ‘Law to Combat Gambling Crimes’. At that time there had been mention specifically of unauthorised exchange in gaming or non-gaming areas of casinos.
Under the updated commentary, any gambling-related foreign exchange activity that could be characterised as part of an “operating business”, could fall under the scope of the provisions.
Mr Chan stated in his Thursday remarks: “In streets or shops [outside a casino or gaming resort]… if the police are able to get hold of evidence – in particular the testimony from the unlicensed currency trader, or, for instance, the ‘client’ of the illicit money exchange trader – proving that the transaction conducted is indeed for gambling, then it is a basis for the [police] investigation units to treat the case as an operation of unlawful money exchange for gambling.”
Such activity can result in a penalty of up to five years’ imprisonment for those found guilty, according to the bill. Such people could also face a Macau casino entry ban of “two to 10 years” in length.
Macau casino bets are mostly denominated in Hong Kong dollars. Many of the gaming venues’ customers are from the Chinese mainland, and may typically have their assets denominated in China’s currency the yuan.
Public security issue
The Macau government has frequently characterised unauthorised currency exchange as a public security concern, saying it can be associated with serious offences such as crimes of violence, or major fraud.
In an opinion document published by the Legislative Assembly and covering key discussions on the bill – the Macau government has stated how it defined the so-called “money exchange gangs”.
The opinion paper stated: “After some research, the law proposer [the Macau government] has officially classified ‘money exchange gangs’ as groups that unlawfully provision a large amount of money for exchange towards individuals or organisations, and they often collaborate with underground banks.”
It added: “In order to sidestep mainland [China] restrictions on the inflow and outflow of foreign currencies and cash, or the overseas withdrawal limits of bank cards, ‘money exchange gangs’ have traded large amount of Hong Kong dollars in cash for mainland gamblers that are bound for Macau.”
The document has also cited the Macau government as stating: “The law proposer [the Macau government] noted that ‘money exchange gangs’ have caused disturbance to Macau society, and their various unlawful activities have affected the security status of Macau, and also had a negative influence on the healthy and orderly development of the gaming industry.”
Another major aspect of the draft Law to Combat Gambling Crimes is in Macau police powers of search and investigation regarding alleged gambling crimes.
For example, in situations of suspected illegal operation of games of fortune, mutual betting or online gaming, security authorities will have the specified right to search suspects’ houses in nighttime and early-morning hours from “9pm to 7am”.
In order to tackle the “hidden” nature of gambling crimes, the government has also proposed allowing “undercover” investigation by police to probe such matters, Mr Chan also mentioned. The bill proposes a “protection mechanism” for informants that assist the police in investigations.
