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The Philippines Suspends Suncity Group License, Offers Recovery Option

The Philippines has faced numerous challenges in regard to its gambling industry of late. The recently-regulated e-sabong vertical has turned out to be permeated by corrupt policemen and officials, leading to a spate of crimes. Yet, the Philippines has been actively trying to do the right thing on all levels of the industry and the latest move against junket operator Suncity Group reflects on the country’s steely determination to eradicate corruption in the gambling sector.

Suncity Group Faces More Regulatory Scrutiny in the Philippines

The Philippine Amusement and Gaming Corp or PAGCOR has ruled that Suncity Group is no longer fit to hold a license in the country, following a lengthy investigation into its suitability. This means that moving forward that Suncity would not be allowed to run any junket rooms on the territory of the country or in cooperation with PAGCOR-regulated license holders.

This does not mean that some may attempt to conceal their operations, but they would face stiff penalties. The Star Sydney casino was found to be cooperating with Suncity Group in a clandestine manner, even though the pair formally quit their partnership in 2019.

However, PAGCOR has enough evidence to go on to prohibit any cooperation with Suncity and Suncity Group Manila, a subsidiary operating out of the capital, Manila. PAGCOR named Suncity in several breaches which grossly infringed consumer protection standards in the country, prompting a closer look at how Suncity ran its business.

Suncity was even accused of “misappropriating” close to $58 million which was reported to the PAGCOR by the victims. The investigation concluded just last week and found out that the complaints had been justified. Suncity has not returned the money to the victims to this date, prompting the regulator to suspend the company’s license. However, Suncity is not yet completely out of the country.

Down, But Not Out Just Yet

PAGCOR has outlined some recovery conditions that may allow Suncity Group to continue operating in the Philippines. For this to happen, the victims and the money they are owed would need to be returned. There are clearer rules for how liquidity should work. For example, the company cannot hold client money into its own business account and keep them separate so that in case of going bankrupt, the client’s money can be paid out.

There will be increased scrutiny in the quarterly operations of the company and just like in the case of Crown Resorts in Western Australia, there would need to be a dedicated monitoring team that would assist Suncity Group with its recovery. The question remains if Suncity would actually want to recover the $58 million missing customer funds.