Macau money chiefs order UnionPay clampdown over illicit mainland China cash fears

Monetary regulators target pawn shops and point-of-sale machines in casino capital of the world as billions of yuan continues to flow out of country

PUBLISHED : Thursday, 07 June, 2018, 9:00pm
UPDATED : Thursday, 07 June, 2018, 9:27pm

A new crackdown on UnionPay cards has been launched by Macau monetary chiefs, as fresh concerns surface over illicit capital flows out of mainland China.

Monetary regulators in the world’s most lucrative casino destination have issued a warning to financial institutions to tackle the illegal use of UnionPay cards to evade strict exchange controls.

The Monetary Authority of Macau made the move against what it called “illegal acts” after pawn shops operating in Macau casinos had their UnionPay point-of-sale terminals removed.

It is the latest move in a long-running campaign to tackle China’s problem with an underground banking network, through which billions of yuan has flowed from the nation’s economy in recent years.

One of the methods employed to funnel cash is the use of UnionPay cards to circumvent withdrawal limits of 20,000 yuan a day – illegal point-of-sale machines are used to disguise withdrawals made in Macau as having been made on the mainland.

Another technique is to buy expensive jewellery, watches and other high-priced goods, then swap them for cash at pawn shops in the casino hub.

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The removal of the point-of-sale machines by Macau banks means pawn shops inside the casinos are now no longer offering UnionPay cashback services.

Officials have told banks to conduct the “ongoing monitoring of merchants” to prevent the use of point-of-sale machines “to conduct illegal activities”.

Last year the Post revealed that at least HK$10 billion a month was being withdrawn from ATMs in Macau, before the introduction of facial recognition technology across the cash machine network.