Singapore: licensing of junket operators could be affected by CRA's probe

At least one analyst believes the licensing of junket operators in Singapore could be affected by CRA's probe as well as ongoing investigations by state and federal agencies in the US and Hong Kong into the gaming market in Asia, and specifically junket operators. 

The investigations by the US Securities and Exchange Commission, the Department of Justice, the FBI, the Nevada Gaming Control Board, and the Hong Kong Securities and Futures Commission are in relation to controversies associated with a wrongful termination lawsuit filed by former Sands China executive Steve Jacobs against Las Vegas Sands (LVS) chairman and CEO Sheldon Adelson. 

On Thursday, CRA announced its investigation into claims of illegal activity involving junket operators at the two Singapore casinos after The Business Times reported Adelson made public his discovery of a suspicious US$ 5 million money transfer between Macau and Singapore via Marina Bay Sands (MBS). 

The Singapore gaming market has so far outperformed industry expectations, ostensibly without junket operators. But some argue that licensing junket operators - if they meet Singapore's stringent regulatory standards - may not only reduce such incidences of illegal activity, but also reduce the casino operators' dependence on revenues from lower-income players, or the mass market, and potentially mitigate growing concerns over problem gambling.

Adelson said Singapore law prohibits casino operators from doing business with third parties, or junket operators that aren't licensed. 'We are not doing business with third parties, (but it) doesn't mean one doesn't slip through without our knowing about it,' he said. 

“However, we have read in the papers of certain investigations commenced against his companies,' he said. 'Resorts World Sentosa holds in high regard the casino regulatory regime, and works closely with CRA on all compliance matters.”

Industry players say Adelson's allegations of illegal junket activity at the casinos are more than just a move to score points with Singapore regulators.