Crackdown On Gambling In Macau

Crackdown On Gambling In Macau

Chinese gamblers have been concerned with the crackdown taking place in Macau. The issue is over ATM withdrawals as it was rumored that the amount of cash one could withdraw per day was going to be limited. Upon the announcement of this rumor casino stocks were said to have plummeted. This had major casino investors and operators concerned about their bottom line. Even casino owners in the U.S. and Australia were impacted by the drop in the value of shares due to this incident.

The rumor, as announced by a newspaper called the South China Morning Post, was that Chinese gamblers who use UnionPay as their bank were going to be forced to cut the amount of money they could withdraw by 50%. This would have limited account holders to a maximum withdrawal per day of USD $626. Cardholders are only limited to withdrawing USD $626 per transaction not per day, as previously believed. As close to half of all Macau’s gamblers use UnionPay mass panic ensued.

UnionPay is under investigation in Macau because many who use it are suspected or known to be illegally taking money out of the country. Since 2014 debit cards issued by UnionPay have been restricted through the removal of their branded ATMs from Chinese casinos. In 2015 there were four arrests made in the alleged illegal use of the ATMs.

The government’s goal in this crackdown is to prevent the further abuse of capital outflow from the country. Chinese territory is meant to benefit from this because it will become more difficult for money laundering to take place undetected.

Despite the ensuing panic, casinos in Macau such as the Grand Lisboa conducted business as usual even after the announcement that sent other casinos and many gamblers into a panic. Despite investors being spooked, the casino’s owners and gamblers didn’t seem concerned about the impending limit.

For many gamblers in China the amount of money they can withdraw per transaction or even per day is not a cause for concern as a significant number of Chinese gamblers are high rollers. UnionPay is more often used by casual gamblers who have a strict budget for their gameplay. The trend among those who use it is to buy items with their UnionPay card and later get the cash back for them so the cash can be used at the casino. These casual gamblers are frequenting Macau’s resorts more than most other groups causing the resort’s casinos to be concerned.

The control of capital outflow is expected to possibly place a limit on how much gambling revenue Macau casinos will be able to recover next year. Foreign exchange rates are expected to play a major role in this. The value of a yaun has decreased so much that it is now a cause for concern among those who rely on the currency. Hurdles have been put in place when it comes to overseas dealings with yaun, and that is part of the problem that the country hopes to solve.

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