Macau police have arrested casino junket boss Levo Chan Weng Lin, chairman and controlling shareholder of Tak Chun Group and co-chairman and CEO of Macau Legend Development. Analysts described Tak Chun Group as second only to Suncity Group in market share for pre-pandemic years in the world’s largest gaming hub.
Macau Legend Development announced on Monday afternoon that the businessman, also known as Levo Chan, would be resigning as co-chairman, CEO and board director “to avoid distraction to the company” and “for the interest of the shareholders of the company as a whole,” reports Nikkei Asia.
Chan took control in 2020 of Macau Legend, which runs the casino in the New Orient Landmark Hotel and owns the Macau Fisherman’s Wharf complex, which features three hotels and two casinos. The company said the weekend arrest “relates to the personal affairs of Mr. Chan.”
Following the news, Macau Legend shares dropped as much as 29.8% in early trading in Hong Kong on Monday. Chan was arrested on Sunday, along with another man, for alleged illegal gambling and money laundering.
“One of the men involved was responsible for operating an illegal gambling syndicate while the other offered assistance,” the police said in a statement on their official WeChat account, without naming either man, according to Reuters.
“The board does not expect the above incident to have a material adverse impact on the daily operations,” Macau Legend said in a statement to the Hong Kong stock exchange on Sunday. Tak Chun Group has not yet commented on the arrest.
The arrest comes amid an ongoing crackdown from officials to cut off outflows of funds from mainland China, where all forms of gambling are illegal. The new zero-tolerance approach specifically targets the junket market, which has long relied on offering easy credit for mainland Chinese high rollers, collecting on their debts using underground financing channels.
It also comes about two months after the arrest of Alvin Chau, head of Suncity, the largest junket operator in Macau. Police have said the new arrests were linked to the Suncity case, as the two groups worked together, engaging in “illicit and criminal activities,” reports Reuters.
Suncity former boss Alvin Chau
Suncity previously operated VIP rooms within the properties of all six of the city’s casino operators. However, following Chau’s arrest, all of them closed, along with most of the city’s junket rooms. This, along with pandemic-related restrictions, has led to VIP gaming revenues to plummet. The VIP industry made up more than two-thirds of revenue a few years ago.
Last week, Macau’s gaming regulator, the Gaming Inspection and Coordination Bureau, slashed junket license issuance by almost half, amid debates from officials on how to further control the sector. Only 46 licenses for casino junkets to operate in the Chinese enclave were approved, down from 85 in January 2021.
In addition to Sun City, another notable absentee is heavyweight Guangdong Group, which was the third-largest junket operator in 2019. Meanwhile, some other major junket brands, including Tak Chun Group, Meg-Star International and Golden Group, are set to retain their licenses this year. The new report casts doubt over the Tak Chun Group approval.
The crackdown comes as Macau’s Legislative Assembly debates proposed amendments to the enclave’s gaming law. The AL passed its first reading of the draft bill earlier this month, which is now set to be sent to the Standing Committee, where closed-door discussions are to be held after the Chinese New Year holiday.
The new gambling legislation seeks to further reduce the role of junket operators in the city’s casino industry. The bill states casino operators would no longer be able to have dedicated junket rooms, and revenue-sharing arrangements between casinos and junket operators would be prohibited.
While Macau will continue to issue junket licenses to approved VIP promoters, the new legislation seeks to restrict them to only operate with one concessionaire. Another measure stipulates that until the 10th of each month, gaming concessionaires will need to submit details regarding the commissions paid to junkets in the previous month, reports Macau Business.
Original article: https://www.yogonet.com/international/news/2022/01/31/61175-macau-2nd-largest-junket-group-boss-arrested-amid-sector-crackdown
