Betting on Chaos - The Philippines Battle Against Chinese Organised Crime
The Asian Crime Century briefing 125
This week Tony Yang, allegedly the architect of the network of Chinese organised crime groups that established themselves in online gambling and online fraud businesses in the Philippines, was arrested by the Presidential Anti-Organized Crime Commission. Tony Yang’s brother Michael was an economic advisor to former President Rodrigo Duterte, illustrating the deep connections between the national government and those involved in organised crime.
The Philippines continues to battle largely Chinese organised crime groups linked to online gambling and cyber crime that are now well entrenched in the country. The struggle against Chinese organised crime groups follows the ban ordered by President Marcos in 2024 on ‘Philippine Offshore Gaming Operators’ (POGOs), aimed at stopping the widespread criminality that many were involved in or facilitated.
In June 100 Chinese nationals were deported from the Philippines to Shanghai, all arrested during operations by the authorities in the capital Metro Manila as well as more remote areas such as Cebu Island. Despite the deportations, the Presidential Anti-Organized Crime Commission stated in June that over 9,000 POGO workers are believed to still be in the Philippines. The Commission also revealed that with around 600 foreigners currently detained at their detention centre the facility is overcrowded and hence operations to arrest former POGO workers have been paused.
The remaining former POGO workers in the Philippines are almost all Chinese nationals, all of whom have had their work visas downgraded to tourist visas by the government so that they have effectively overstayed their visa conditions. In total, the authorities have deported around 4,000 people but locating the remaining 9,000 is difficult as they are believed to have moved from large commercial compounds where POGOs operated in the past to small scale “guerrilla centres” such as private resorts where they are lower profile.
Chinese criminals and Filipino corruption
Tony Yang is according to the Philippines authorities an illegal immigrant who has been living in the country for 30 years. The National Bureau of Investigation filed 16 charges against him in 2024 and he was first arrested in September by the Bureau of Immigration. The re-arrest by the Presidential Anti-Organized Crime Commission is related to new charges of falsification of public documents, perjury, and violation of the Act Regulating the Use of Aliases. According to the Commission, Yang used the name Antonio Maestrado Lim and established at least 12 companies in the Philippines in Cebu, Davao, and Cagayan de Oro which involved shopping malls, rice mills, and a steel plant.
His brother Michael Yang, the former economic presidential adviser of former president Rodrigo Duterte, is wanted by the Philippines authorities in relation to illegal drugs and criminality in POGO operations. He has been described during the Philippines House of Representatives hearings as a central figure in a web of mostly Chinese-run companies connected to illegal drugs, murders, and online illegal gambling.
Tony Yang gave evidence to the Philippines Senate in September 2024 and during his testimony admitted possessing a fake birth certificate in the name of Antonio Maestrado Lim showing him to have been born in the Philippines, but he he was in fact born in Fujian Province in China. He came to the Philippines around 1998 when he aged in his late twenties and has a passport under the name Yang Jian Xin issued by the People’s Republic of China (PRC).
Evidence taken during the Senate hearing has shown that Yang was a close associate of senior Filipino police officers, including former Philippine National Police chief Benjamin Acorda (during the administration of President Duterte) who before his national police role had been regional police chief of Northern Mindanao, which covers Cagayan de Oro City where most of Yang’s businesses are located. The Senate hearing was shown photos of Tony Yang and Benjamin Acorda together, and also shown pictures of the Philippine National Police chief with Wesley Guo, the brother of Alice Leal Guo who allegedly operated a fraud compound.
Alice Leal Guo, former Mayor of Bamban, a municipality in the province of Tarlac, was arrested in September 2024 in Indonesia after fleeing from the Philippines authorities. She is accused of involvement in operating illegal online gambling, human trafficking, and illegal detention, as well as hiding the fact that she is not a Philippines national but in fact a citizen of the PRC originating from Fujian Province.
In May, the Philippines Department of Justice laid charges Alice Guo, her parents Jian Zhong Guo and Lin Wenyi and siblings Shiela and Seimen, as well as 26 officials of companies involved in Pogo operations with multiple counts of money laundering. The charges relate to POGO financial proceeds from online gambling, online fraud and other cyber crime that were transferred to other businesses of the Guo family. Alice Guo is also facing other charges relating to trafficking in persons, corruption, material misrepresentation, and falsification of public documents.
However, Alice Guo is seemingly not the leader of the criminal syndicate. She alleges that the “big boss” of the criminal business was a Chinese man named Huang Zhiyang. In July 2024, the Presidential Anti-Organized Crime Commission reported that evidence was found from raids on POGOs Zun Yuan Technology Corporation in Bamban and Lucky South 99 Corporation in Pampanga, that one of the bosses of the companies is Huang Zhiyang and that he was a business partner of Alice Leal Guo.
During other raids by the Philippines police in June on the Fontana Leisure Resort and Casino in Angeles City (where the former US Air Force base at Clark Fields was located), they discovered documents with the names ‘Zhang Ruijin’ and ‘Lin Baoyang’ who had incorporated the companies engaged in criminality in Bamban associated with Alice Guo and who were both at that time imprisoned in Singapore on money laundering charges.
Zhang and Lin were amongst ten people arrested by the Singapore Police in August 2023, all of whom were originally from Fujian Province in the PRC but most had passports and citizenship from other countries. Zhang Ruijin had a passport issued by Saint Kitts and Nevis, an island country in the Caribbean. Lin Baoying, who was referred to in Singapore as Zhang’s lover, was found with passports issued by the Dominican Republic and Turkey.
Amongst the associates of Zhang and Lin in Singapore was a 34 year old Fujian man named Wang Binggan (王斌刚), who was not arrested but was identified as a member of the syndicate. Wang was identified by Chinese news media as the organiser of an illegal online gambling operation discovered in China in 2015, and as the founder of an online gambling website called ‘Hongli International’ (鸿利国际) that was hosted in the former Clark Airbase in the Philippines. In 2012, Hongli International was reported to have turned over almost one billion yuan (USD 140 million) that was identified in accounts frozen by the Public Security Bureau in China. Wang Binggan reportedly moved the Hongli online gambling website to Cambodia in 2014, but in 2015 he was apprehended by Chinese police who had tracked him there and after being returned to China was sentenced to three years imprisonment.
The network of criminal operations involving this syndicate stretched from China (where there was a huge gambling customer base), to the Philippines and Cambodia (for website operations), and to Singapore (for laundering the huge proceeds of the online gambling and other cyber crime). Online sports betting and other online gambling was key to the revenue of the syndicate since its inception around 2012.
Gambling regulatory overload
Since POGOs were banned, the Philippines has been through a traumatic review of the scale of Chinese organised crime in the country, how it happened, and how to deal with it. The House of Representatives, the elected legislature, convened hearings in its Quad Committee (which is comprised of four panels focussed on Dangerous Drugs, Public Order and Safety, Human Right, and Public Accounts) to investigate links between POGOs, human trafficking, drug smuggling and extrajudicial killings during the war on drugs by the administration of former President Duterte. In June, the Quad Committee announced the findings of their investigation which involved a network of criminality involving Chinese nationals and Filipino collaborators.
Representative Robert Ace Barbers, co-chair of the House Quad Committee dramatically summarised Chinese criminal infiltration of the Philippines and the complicity of Filipino officials by saying that “The Chinese raped us but we helped them rape us.”
According to Mr. Barbers, a key decision made by former President Duterte that allowed POGOs to boom and become dominated by Chinese organised crime groups was Executive Order Number 13 issued in February 2017. The order was misleadingly titled “Strengthening the fight against illegal gambling and clarifying jurisdiction and authority of concerned agencies in the regulation and licensing of gambling and online gaming facilities, and for other purposes”.
Executive Order Number 13 articulated the illegal gambling problem in the Philippines as being driven by multiple gambling licensing authorities, which included national regulator the Philippine Amusement and Gaming Corporation (PAGCOR), the Cagayan Economic Zone Authority (located on the northern tip of the island of Luzon), the Aurora Pacific Economic Zone and Freeport Authority (located on the East coast of Luzon island), and the Authority of the Freeport Area of Bataan (located on a peninsular to the West of Manila). These desperate gambling regulatory agencies had evolved since the Cagayan gambling licensing authority was created in 2003, followed by Aurora Pacific and Bataan in 2016.
In some way the Duterte administration was correct that the proliferation of gambling regulatory regimes in the Philippines had contributed to the proliferation of illegal gambling and gaming. Chinese and other Asian organised crime groups migrated to Cagayan as an idyllic operating location for online gambling businesses when the licensing system was established in 2003, hence they have been developing the Philippines as a base for over two decades. During that period the provincial gambling licensing hubs became incubators for transnational crime and enabled the gangs operating there to develop their skills in human trafficking, online fraud, crypto scams, money laundering, identity fraud, and more.
The POGOs were not the originator of the Chinese organised crime base in the Philippines, but was only a new label after Duterte closed the provincial gambling licensing hubs and mandated that the license holders migrate to the national system. Chinese organised crime groups in the Philippines went from paying provincial governments to paying the national government.
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The online illegal gambling and online fraud that was first established under the cover of provincial gambling licenses in Cagayan, the Aurora Pacific Freeport, and the Bataan Freeport was transitioned under former President Duterte to national POGO licenses, outlawed in 2024 but now continues underground. The infrastructure to support mostly Chinese organised crime groups has been long established in the Philippines and it will take years to root out. There are so many Chinese expatriates in the Philippines, staying legally or illegally, that the authorities do not have the resources to arrest them all or even detain them. Because of this entrenched organised crime problem, supported by widespread corruption amongst officials in the Philippines, the authorities need to take a long term approach to suppress the operations and deport those involved. This looks like a five year plan.
The Philippines is grappling with the problem of entrenched Chinese organised crime groups, but clearly they are transnational and can move to safer havens when the authorities become too troublesome. The Philippines has a wealth of choice of remote islands for criminals to evade the authorities, or they can easily take a short boat ride to islands within Indonesian territory (as Alice Leal Guo did when she fled). If Chinese organised crime groups are entrenched in the Philippines, then in Cambodia the situation is even worse as there is no crackdown from the authorities that in many cases work with criminal gangs. There is a long way to go in combatting this transnational Chinese organised crime problem.