Aguirre to lead online gaming crackdown

Justice Secretary Vitaliano Aguirre II. INQUIRER FILE PHOTO/NIÑO JESUS ORBETA

President Duterte has tapped Justice Secretary Vitaliano Aguirre II to lead a task force that would crack down on online gaming casinos in economic zones in Cagayan, Aurora and Bataan provinces for massive tax evasion.

Executive Secretary Salvador Medialdea is drafting an executive order that would empower the task force to look into allegations that these online gaming casinos have been depriving the government a trillion pesos in lost revenue annually based on the President’s estimates, according to Aguirre.

Mr. Duterte on Thursday ordered the closure of all online gaming operations in the country, but Aguirre clarified that the President was referring only to companies that obtained their licenses from the Cagayan Economic Zone Authority (Ceza), which was controlled by former Sen. Juan Ponce Enrile and Negros Occidental Rep. Albee Benitez; Aurora Pacific Economic Zone (Apeco), which was controlled by former Sen. Edgardo Angara; and those operating inside the Authority of the Freeport Area of Bataan (Afab), the former Bataan Export Processing Zone.

The order, Aguirre also said, did not cover online gaming operations licensed by the Philippine Amusement and Gaming Corp. (Pagcor).

“This is much bigger than Jack Lam. This involves huge amounts of money and we are still waiting what specific powers the task force will get to go after this massive tax fraud,” Aguirre told reporters on Friday.

Aguirre was referring to Chinese gaming tycoon Jack Lam, who was ordered arrested by the President for bribery and economic sabotage after a Nov. 24 raid on his Fontana Leisure Parks and Casino at Clark Freeport in Pampanga that led to the arrest of 1,316 illegal Chinese workers operating unlicensed online games.

The Department of Justice also conducted on Dec. 10 a raid on Lam’s Fort IIocandia Resort in Laoag City but the illegal Chinese workers inside the illicit online games business had fled. Both Fontana and Fort Ilocandia have been shuttered.

Aguirre said there were other bigger online gaming companies operating solely on permits granted by Ceza, Apeco and Afab that have not been following the rules on labor and tax remittances as revealed by the President.

P1B from ‘offshore’ gaming

Pagcor has raised nearly P1 billion from licensing companies in the “offshore” online gaming industry, which underwent a sweeping revamp under Mr. Duterte. Pagcor has approved 35 licenses under the new Philippine Offshore Gaming Operation, charging between $150,000 and $200,000 for operators seeking sports betting and e-casino permits.

“Online operations that violate our gambling laws, our tax laws, that do not pay the right taxes like Jack Lam are the targets. But with respect to others who are complying with the limitations, of Pagcor limitations, they have nothing to worry about,” Aguirre said.