Macau casino junket operators appear to have been blindsided by the local government’s recent decision to ban telephone aka ‘proxy’ betting at VIP gaming tables.
On Friday, Macau’s Gaming Inspection and Coordination Bureau (DICJ) confirmed rumors that casinos would no longer be able to offer proxy betting as of Monday (9). On Saturday, Secretary for Economy and Finance Lionel Leong Vai Tac said this step was taken “to avoid unnecessary misunderstandings or the risk of irregularities.”
Proxy betting involves a trusted intermediary sitting at a casino VIP table, relaying real-time card info to a gambler (usually) on the Chinese mainland, who in turn issues instructions on how much money to wager on a particular hand. The practice gained popularity as Beijing tightened controls on the flow of money and individuals to and from Macau.
Leong claimed that proxy betting had previously been made available to some registered VIPs, although he declined to specify with whom said VIPs had registered. Leong further claimed that the government had determined that a proxy betting ban “will not hurt the sustainable development of the gaming sector.”
The truth of Leong’s statement appears to depend on where you’re sitting. Discussing his company’s Q1 results on Thursday, Wynn Resorts boss Steve Wynn said the ban would be “insignificant” to his company. However, Sterne Agee analysts suggested the ban could negatively impact Wynn Macau to the tune of $5m per quarter.
Union Gaming analyst Grant Govertsen said the government had chosen to relay info regarding the ban directly to the casinos, who were then responsible for informing their junket partners, “some of whom were taken by surprise.”
Govertsen said subsequent conversations with junkets had revealed that the sector’s ongoing talks with the government regarding junket reforms hadn’t addressed the proxy issue “in any meaningful way.” Govertsen concluded that the junkets viewed the proxy ban announcement as “an unwelcome 11th hour surprise.”
Macau officials have yet to indicate what steps might be taken to ensure the proxy ban is upheld in the junket-run VIP rooms. It seems doubtful that any junkets would risk incurring the DICJ’s wrath by flouting the ban, and those with operations in more proxy friendly jurisdictions will likely continue to steer their VIPs away from Macau.
