Jan 11, 2017 Newsdesk Latest News, Macau, Top of the deck
Anselmo Teng Lin Seng, chairman at the Monetary Authority of Macau (pictured), said on Tuesday that the authority might strengthen guidelines concerning the use of point of sale (POS) terminals; a course of action that could be implemented in the city if deemed “necessary”.
Mr Teng was speaking to media on the sidelines of a Tuesday event when asked for comments on the recent raids involving the Judiciary Police and Monetary Authority of Macau officials, relating to suspected use of illegally-modified handheld China UnionPay Co Ltd card payment terminals, also known as POS units.
“Those [POS] terminals [it is suspected] are illegally brought over here from mainland China; in other words, [they] are not connected to the banks in Macau,” Mr Teng told media.
“Of course, if needed, we’ll work with the financial authorities or the regulatory bodies in mainland China to see how we can further close the loopholes seen in these cross-border activities [transactions handled via POS terminals],” the official added.
Mr Teng stressed that there is already a “strict” guideline in place for the acquiring banks in Macau, regarding the use of POS units.
On January 5, the Judiciary Police detained 23 people – it said were linked to eight local shops – suspected of utilising illegally-modified UnionPay POS units. As a result of the operation, the police seized 10 UnionPay POS units on suspicion that they had been tampered with in order to register Macau-based sales transactions as having taken place on the mainland, where transaction fees are smaller.
Similar enforcement action had happened in 2015 without hurting Macau casino gross gaming revenue (GGR), brokerage Sanford C. Bernstein Ltd noted in a Monday memo.
“…in mid-August 2015, Macau authorities conducted similar operations, raiding five shops, arresting 17 individuals and seizing 11 POS devices. Following that raid, we saw no impact on pawn shop transaction activity or on GGR stemming from the action,” said the note from analysts Vitaly Umansky, Zhen Gong and Yang Xie.
Sanford Bernstein did however caution in its Monday commentary: “We would highlight that there is continued risk in Macau about government action with respect to UnionPay utilisation. Any major changes to the way UnionPay is utilised in Macau could create headwinds and potential downside risk to Macau GGR at the higher end premium mass segment and some VIP business.”
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.
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