TLDR
- The Philippine central bank closed more than 8,000 merchant accounts tied to unlicensed online casinos.
- Businesses like bakeries, salons, and small stores were used to process the illegal payments.
- Authorities flagged accounts taking thousands of small bets late at night and into early morning.
- PAGCOR is working with the central bank and building an app to help users find legal gambling sites.
- New draft rules will force payment platforms to screen merchants more closely before onboarding them.
Authorities in the Philippines have closed more than 8,000 merchant accounts after finding they were being used to funnel money to unregistered online casino operators.
The closures were confirmed by Bangko Sentral ng Pilipinas, the country’s central bank, according to a Bloomberg report. The bank said the accounts were tied to businesses that appeared ordinary on the surface.
These included beauty salons, bakeries, and small neighborhood stores. Investigators found that many of them were actually processing bets for illegal gambling platforms.
Mamerto Tangonan, deputy governor of the central bank, said the goal is to protect consumers from fraud and money laundering. He said digital payments cannot grow if people keep losing money to scams.
Late-Night Transactions Raised Concerns
The pattern that caught investigators’ attention involved timing. Some merchant accounts were processing thousands of tiny payments, as low as PHP50, or about $0.80.
These transactions often happened after midnight and continued into the early morning. That is unusual for businesses like bakeries or salons, which are normally closed during those hours.
Further review found the payments were actually online casino bets. This pattern helped investigators identify which accounts were being misused.
Officials have not shared the total value of funds that moved through these accounts. They also have not named the specific businesses involved.
Still, the scale of the shutdown, more than 8,000 accounts, shows how widespread the issue had become. Alejandro Tengco, chairman of the Philippine Amusement and Gaming Corp, known as PAGCOR, said the regulator had noticed harmless-sounding business names hiding unlicensed casino operations.
Tengco said PAGCOR does not directly control these businesses. He added that the agency is working closely with the central bank to address the problem.
Last month, Tengco said PAGCOR is developing an app to help people find legal online gambling platforms. The tool is meant to guide users away from unauthorized sites.
New Screening Rules for Payment Platforms
The central bank recently released a draft policy requiring payment providers to tighten how they vet merchants. Providers will need to collect more information before adding new businesses to their systems.
This includes details about business owners and any relevant licenses. The central bank also wants payment platforms to build shared databases of approved, legitimate merchants.
Tangonan said payment companies could lose their licenses if violations continue. He said providers are responsible for stopping illegal activity once it is identified on their platforms.
The central bank has not set a timeline for when the new merchant screening rules will take effect.
