Philippines: Illegal numbers game nets $1.4 billion annually
'Jueteng' operators net Php73 billion, avoid tax men
Highlights
- Over 30,000 gaming outlets shut down following President Duterte's order
- Citing “massive corruption”, Duterte ordered the closure of all lotto, small town lottery (STL), Peryahan ng Bayan and Keno outlets
- PCSO earned Php63.56 billion ($1.24 billion) from all its gaming activities in 2018
MANILA: The Philippines is losing up to $1.4 billion in state revenues from illegal numbers game operators hiding under the skirt of a corruption-plagued gaming outfit.
Add to this the reportedly rigged results and dodgy contracts that favour a chosen few at the state-sanctioned lottery operator Philippine Charity Sweepstakes Office (PCSO), which led President Rodrigo Duterte to shut down thousands of lottery stations across the country.
Gambling lords, working with on-the-take local government and police officials — and even the courts — rake in at least Php73 billion ($1.43 billion, Dh5.25 billion) from the wildly popular illegal numbers game called “jueteng” each year, leaving the government shortchanged, said top officials.
The president's spokesperson Salvador Panelo said that the government was losing up to 70 per cent of revenue from the games because of "corruption". He said Duterte would soon identify the wrongdoers.
Duterte ordered the police and military to shut down all lotteries and gaming activities run by the PCSO, accusing the agency of corruption.
“The ground is massive corruption involving all, even the courts,” Duterte said in a speech posted on the presidential communication office’s Facebook account on Friday.
Meanwhile, Senator Panfilo Lacson said that "jueteng" uses legal government-sanctioned gaming francises called Small Town Lottery (STL) as fronts.
The Philippine Charity Sweepstakes Office (PCSO) is the government-authorised STL operator and the much-bigger "Lotto" numbers game.
• It is a wildly popular game with participation that crosses most, if not all, social and economic boundaries.
• With long odds and no limits on minimum or maximum bets, the lure of quick riches through a lucrative payout is by far its strongest appeal.
• Jueteng was introduced by Spanish colonizers, dating back to the 1800s. Tickets were even sold in ferries or boats to the Visayas and Mindanao.
• During most the 20th century, jueteng operations were primarily conducted and financed by Chinese migrants, until the locals ultimately took over.
On Sunday, police officers shut down thousands of lotto sales outlets across following orders of President Duterte. Most senators backed the move, while some proposed the privatization of the state-owned firm’s operations.
Sen. Lacson previously spearheaded congressional probes into the proliferation of “jueteng”.
Lacson, a former police chief, said regular collections from the illegal numbers game in Metro Manila, the Cordillera Administrative Region and Regions 1 to 5 alone — net about Php200 million (Dh14.4 million) daily.
200m
Lacson said almost all jueteng operators use STL franchises issued by the PCSO as fronts for the illegal gambling operations.
The lion's share of the daily take is siphoned off by the operators and their protectors in local police and government — leaving the state-owned PCSO with a mere P4 billion a year.
Local politicians and police involved in jueteng operations contribute to the huge web of corruption, said Lacson, adding: “We do not need an Albert Einstein to figure out how much goes to the individual pockets of STL franchise holders, corrupt politicians, policemen and PCSO officials.”
“A big chunk of that money is not even in cash remittances, but recorded as collectibles,” Lacson told the Philipine Star daily.
Gambling money
Lacson said: “The palms of these people continue to be greased by gambling money.” He added that “jueteng” merely masquerades as a legit STL for seven days a week, and whose “kubrador” (collectors) are armed with PCSO IDs to avoid arrest.
• Over 500,000 Filipinos benefited from the medical assistance provided by the PCSO in 2018.
• In 2017, PCSO raised Php53 billion ($1.04 billion) from its games that included small town lotteries, 34% higher than a year earlier.
• In 2018, PCSO earned Php63.56 billion ($1.24 billion) from all its gaming activities.
• Php18.69 billion, or 30 percent, of the 2018 earnings were used for charity programmes. It paid for the confinement, medicines, and chemotherapy and other medical procedures for indigent patients.
Lotto operations, are computerised, automated and closely monitored, but jueteng is not. And though he agreed with the President's shutdown order, he stressed that the Chief Executive should have spared the legal lotto since there are no reports of revenue cheating.
Senate President Vicente Sotto III said Duterte seems to be only targeting the corruption-prone PCSO franchises. “It can always open once the corruption is unearthed and cleansed,” he said.
‘Privatisation’
On Sunday, Sen. Sherwin Gatchalian proposed the hand-over to the private sector of lotto and casino operations, with the government only collecting guaranteed proceeds. The proceeds, he added, could be remitted directly to the Department of Social Work and Development (DSWD) to fund social service programs.
Meanwhile, former senator Joseph Victor Ejercito, principal sponsor of the Universal Health Care (UHC) Law due for implementation soon, warned that the shutdown could worsen the funding gap for the programme.
Sen. Francis Tolentino said the UHC won't crippled by lack of funding as he said that Republic Act 11346 or the "Sin Tax Law" and other sources of funds would fill the gap.
Opposition Sen. Risa Hontiveros wants Duterte to disclose to the public the details of the alleged corruption in the PCSO. She said the directive was meant to divert the workers’ outrage over his veto of the Security of Tenure Bill or the “end endo” bill. She also questioned his drastic action against PCSO and his apparent “soft stance” on the Chinese-dominated Philippine offshore gaming operations.
Jueteng resurgence
Police in the National Capital Region (NCR), meanwhile, said they are closely monitoring the resurgence of the illegal numbers game jueteng in Metro Manila following the closure of all PCSO gaming operations.
“I’m warning these gambling lords not to return to their old illegal business of jueteng as they would be dealt with accordingly,” said NCRPO director Maj. General Guillermo Eleazar was quoted by the Philippine Star as saying.