Philippine senate calls for arrest of Bamban mayor in potential “Trojan horse” case

Philippine authorities are calling for the arrest of a suspended small-town mayor linked to crimes in the offshore gaming industry. Some lawmakers say the industry is part of Beijing’s larger strategy to compromise national security.

Some Philippine lawmakers claim China is infiltrating the country’s offshore gaming industry. They claim China is using a “Trojan horse” strategy to undermine national security.

Philippine Offshore Gaming Operations (POGOs), many Chinese-run, have previously been linked to crimes including online scams, kidnapping, torture and even murder.

Last fall, POGOs were rebranded as Internet Gaming Licensees (IGLs). The new name is an attempt by the regulator to distinguish lawful from unlawful operators. But there are still calls for a ban on the industry. The calls intensified beginning in March, when a small-town mayor was implicated in POGO-related crimes.

In the 13 March raid of a POGO complex in Bamban, Tarlac, authorities freed 868 workers believed to be human-trafficking victims. They also seized nine villas, 46 vehicles, €89,025 in cash and items including motorcycles and heavy equipment. The compound, run by Zun Yuan Technology Inc, was located on land partly owned by Bamban mayor Alice Guo.

A subsequent probe showed that billions of pesos flowed into 36 bank accounts held by Guo. “A big portion of the money came from China” and was allegedly used to finance the offshore operation, said Senator Win Gatchalian, a longtime POGO critic. Guo’s accounts have since been frozen.

A separate investigation revealed that the Filipina mayor and a Chinese passport holder named Guo Hua Ping may be one and the same. They have the same fingerprints.

“No one knows her,” said president Ferdinand Marcos Jr of the mayor, who was elected in 2022 and suspended in the aftermath of the raid. “We wonder where she came from. That’s why we are investigating this, together with the bureau of immigration, because of the questions about her citizenship.”

The plot thickens

Last week, when Guo failed to show up for a second hearing in the criminal matter, the Philippine senate called for her arrest. But Guo’s lawyer claims she was too stressed to attend, having suffered “massive cyber-bullying and humiliation”.

The drama is playing out amid ongoing tensions between the Philippines and China over territorial rights in the South China Sea. Diplomatic relations between the countries warmed under former Philippine president Rodrigo Duterte. Later, he was accused of cosying up to Chinese president Xi Jinping. But Marcos’ pro-US stance has chilled things considerably.

Senate President Pro Tempore Jinggoy Estrada is concerned about POGO operations near military and police facilities in Quezon City, Pasay City, Taguig City and Manila. “Reports on some 250 others operating without licences should prompt our concerned authorities to conduct a crackdown on these illegal entities,” he said.

Armed forces chief of staff General Romeo Brawner Jr said the “strategic locations of POGOs” near the capital create “a perimeter for espionage”.

Security expert Chester Cabalza has called POGOs “a Trojan horse that can stage a surprise attack in the Philippines”.

Alejandro Tengco, head of the Philippine Amusement and Gaming Corporation (Pagcor), acknowledged that criminals may have seen the Philippine regulator as “a bit lenient in the past. They were able to come in without Pagcor knowing that they were already doing criminal activities instead of gaming operations.”

Now, he said, the regulator is working with authorities to identify and bring down bad actors in the space. In June, Pagcor defended legitimate POGOs as a raid of illegal locations revealed criminal activity.

Gatchalian is unimpressed and has demanded an “immediate ban” of the offshore operations. “In addition to the proliferation of heinous crimes associated with POGOs,” he said, “the industry has raised serious national security concerns that must be addressed promptly and with strong political will.”

Defense Secretary Gilberto Teodoro agrees. “These syndicated criminal activities… weaken our financial standing, our country ratings (and) corrupt our society,” he said.

In his view, Beijing could be supporting illegal POGOs to undermine “our political, economic, social and peace and order fabric. The most effective way of weakening your enemy is to cause trouble in its country.”

Written by Marjorie Preston