Philippine Offshore Gaming Operators (POGO) have somehow standardized crime and corruption as part of their business model, and only now is the government starting to take notice.
In March, the raid of a POGO compound in Bamban, Tarlac uncovered its involvement in cybercrime and human trafficking. The Senate soon launched investigations against the town mayor, Alice Guo, which revealed that she had ties with the raided gambling firm.
These discoveries expose the parasitic presence of POGOs in the country that will only exacerbate corruption and patronage politics. A decision to ban the exploitative industry must be expedited before the Philippines deteriorates into a money-laundering state.
POGOs have already attached themselves to the economy as rent-seekers. Online gambling firms began to emerge during the administration of former President Rodrigo Duterte due to the government’s lenient gambling laws. Despite being regulated by the Philippine Amusement and Gaming Corporation (PAGCOR), more than 250 illegal POGOs operate in the country while only 46 are licensed firms.
Over time, POGOs have jeopardized the economy rather than provided worthwhile state revenue. Annual tax collections from POGOs should amount to P35 billion but only P7.2 billion was collected in 2022. This, as POGO-related crimes can lose the country up to P26.2 billion in foreign investments, according to the Department of Finance.
However, POGOs should not be justified based on revenue alone since they do not have the same benefits provided by other investments. What they mainly contribute to the country is crime.
A total of 4,355 individuals fell victim to POGO-related crimes, but only one out of the 102 cases reached a conviction. Weak regulations have gradually transformed POGOs into crime syndicates that connive with politicians and local criminal organizations, according to Sen. Sherwin Gatchalian. Illegal activities tied to the industry include kidnapping, murder, and scams.
PAGCOR told lawmakers to maintain POGOs, but it has failed to prove that it can regulate the industry. It claims that POGOs are routinely inspected yet raids against compounds prove hubs can illegally operate for years. It does not help that local governments enable illicit activities in their area. Firms in Bamban thrived because the mayor generously issued permits, while operators were allegedly tipped off on government operations in Pampanga which compromised a planned raid. Without decisive action to prevent POGO expansion, the scheme may become more difficult to dislodge.
POGOs have already leeched themselves in real estate, occupying five percent of the country’s total leasable office spaces with some located near military bases. While some Filipinos are employed in the POGO industry, a significant portion are foreign employees who are often trafficked into the country and then exploited.
The dubious nature of POGOs also puts into question the ethicality of sourcing public funds. Moral problems arise when government spending for social services and other public goods is sourced directly from an industry built on gambling and crime.
Following the recent string of investigations, both houses of Congress have begun to push for the criminalization of all POGO operations in the country. Allegations of POGOs tampering in the judiciary have even drawn the attention of the Supreme Court to investigate.
The industry’s presence in the country has gone on long enough. Stricter regulations will not deter a sector that mainly operates to undermine the law. For POGOs and their corruption to be uprooted, the legal leg from which it stands must be severed before the industry leeches itself further on the economy and Philippine politics. ●
First published in the June 19, 2024 print edition of the Collegian
