PUERTO GALERA, Oriental Mindoro – Government authorities raided a resort in the tourist town of Puerto Galera, Oriental Mindoro on Saturday night, uncovering what they suspect to be an illegal offshore gaming operation linked to Philippine Offshore Gaming Operators (POGOs).

The raid conducted on July 15, 2024 involved several Chinese and other foreign nationals.

Acting on a search warrant issued by Judge Josephine Caranzo of Calapan City Regional Trial Court Branch 39, agents from the National Bureau of Investigation (NBI) and the Philippine Army stormed the Puerto Galera Seaview Resort in the mountainous area of Barangay Sinandigan.

NBI Mimaropa Regional Director Atty. Gelacio Bongngat told media that despite intelligence indicating nightly gambling activities, the resort was eerily quiet upon their arrival.

“Based on our informant, it was noisy every night with many people gambling. But when we arrived with the Philippine Army, the place was clean,” Bongngat said. “However, when we entered the rooms, we found baccarat tables, mahjong tables, and other gambling paraphernalia stacked inside.”

Authorities discovered nearly 40 Chinese nationals and other foreigners at the resort. While they were not caught in the act of gambling, the NBI recorded details from their passports for further investigation.

The resort owner, identified as Chinese national Stefan Cheng, was arrested during the operation. Cheng declined to comment when approached by reporters.

Seized items included mahjong tables, poker tables, baccarat tables, tokens, plastic chips, playing cards, and slot machines. Laptops were also found but not confiscated, as they were not specified in the search warrant.

Bongngat emphasized that the Philippine Amusement and Gaming Corporation (PAGCOR) has not issued any permits for POGO operations in Puerto Galera. The NBI plans to conduct a more thorough investigation and may apply for additional search warrants to gather evidence supporting their suspicions of illegal POGO activities at the resort.

The raid came as a surprise to Puerto Galera Mayor Rocky Ilagan, who insisted that the resort was not involved in POGO operations. Ilagan said he would not allow POGO activities in the popular tourist destination.

Authorities are preparing to file charges against the resort owner for violating Presidential Decree 1602, which pertains to illegal gambling.

The recent crackdowns showed the ongoing challenges faced by Philippine authorities in regulating the POGO industry, which began operating in the country in 2003. It was only in 2016, under President Rodrigo Duterte’s administration, that the government started to regulate these online gaming hubs more strictly.

POGOs, which cater to customers outside the Philippines, must be licensed by PAGCOR to operate legally. The industry, predominantly Chinese-backed and concentrated in Metro Manila, has faced increasing scrutiny and regulations in recent years, leading to a reduction in the number of operating POGOs.

While POGOs have contributed to economic growth in the Philippines, they have also been associated with various social and economic challenges.

In 2023, POGOs were estimated to contribute about 0.2% of the country’s GDP, approximately P42 billion pesos.

However, the industry has been linked to crimes, tax evasion, and corruption. Critics argue that POGOs may have diverted attention from other sectors, potentially affecting foreign direct investments and tourism.

The raid in Puerto Galera is expected to have wider implications for POGO operations across the Philippines.

Industry experts anticipate increased scrutiny from authorities, potential operational shifts by POGO operators to avoid detection, and possible market disruptions affecting revenue streams and investor confidence.