Shady dealings: triads ‘play major role’ in high-rolling Macau VIP casino rooms
Triads still dominate VIP rooms in Macau, and they have now extensive networks with mainland officials, junkets, high rollers, investors and criminals
A gangland reputation, financial clout and the ability to recover debts by whatever means necessary – that’s what it takes to run a high-rolling VIP operation in a Macau casino, according to an in-depth academic study.
After three years of research, leading sociologist T. Wing Lo and fellow academic Sharon Ingrid Kwok of Hong Kong’s City University reached conclusions which lend academic weight to the widely held belief that organised crime is at the heart of the gaming industry in the former Portuguese enclave.
For the work, published in the respected British Journal of Criminology and titled “Triad Organized Crime in Macau Casinos: Extra-Legal Governance and Entrepreneurship”, the Hong Kong academics interviewed triad members, police, government officials and casino VIP room operators.
The lengthy paper comes as Macau’s junket operators are on the back foot amid an economic slowdown on the mainland and a corruption crackdown by Beijing. But it reveals the often shady businesses which bring in casino high-rollers have a keen ability to adapt to changing circumstances and in some cases are being usurped by mainland operators.
“The VIP-room operations are still dominated by triads to date,” the academicsconcluded. “But they have readjusted their traditional intrusive role and reinvented harmonious business strategies to suit the market reality.”
According to the study, which focuses on the embattled casino junket business, junket companies responsible for running VIP rooms in Macau “are the main drivers of economic profits for the triads”.
But they no longer use the old strategies to fight for profit and clients. Operations in casinos, particularly in the VIP rooms had become “more civilised” and turned into an enterprise, the study noted.
Triads are now also forced to work beyond Macau’s borders, collaborating with mainland officials and syndicates. Rapid economic growth in the mainland “has induced triads to move away from the rigid territorial base in Macau to develop flexible, social and entrepreneurial networks with mainland officials, junkets, whales [high rollers], investors and criminals”, it noted.
The study showed the importance of mainland junkets as power brokers had grown stronger. This meant that Macau triads had lost full control, as they needed to collaborate with mainland gangsters to collect debts.
The conclusions are based on research carried out over 30 months between 2012 and 2015, which included 17 interviews with triad members, VIP room operators, police officers and mainland officials and visits to VIP rooms.
According to the report, casino management – even though they have denied it – were fully aware of the connections between VIP operators and the underworld. “We were given the chance to run a VIP room because my brother-in-law had a reputation in the triad underworld,” one former VIP contractor said.
According to a member of the 14K triad also interviewed for the study, most VIP-room contractors “are triads or businessmen with a triad background ... The casino management would select the most powerful triads, based on a couple of factors including money, triad, reputation and ability to mobilise manpower”.
Unlike in the old days, there is a mutual understanding among casino management and triads that harmony is needed.
VIP rooms are described in the study as “bank-like” business enterprises. A junket must provide hotels, transport, loans and sex services. High-rollers are expected to spend at least HK$500,000 per trip in a room.
The research said different VIP rooms had customers who come from different provinces on the mainland, which meant that triads these days needed to have spokespersons there.
This new enterprise model has brought a number of difficulties as VIP operators seem to have gradually lost control over middlemen, resulting in cases of fraud.
“ Nowadays, it is not easy to operate a VIP room as it needs soft skills,” a former VIP contracter said. “It is not simply about fighting. We need to find gamblers from the mainland. We need to give them credit. At the same time, we worry that we cannot collect the debt,” he said.
Macau’s Gaming Inspection and Coordination Bureau said it was not aware of triads operating in VIP rooms. “So far we have not verified any triads selected by casinos or working with junkets,” Macau’s top casino regulator told news agency Lusa, adding that “appropriate measures” would be taken if irregularities were found.