Ghost owners of stolen identities only tip of a ‘deep, deadly’ POGO network

Lazy regulation, lack of political will, or the intervention of a foreign state? PAOCC says whatever it is, it has allowed 'dangerous criminals to hide in plain sight'

MANILA, Philippines – She is Merlie Joy Castro from Concepcion, Tarlac. According to Securities and Exchange Commission (SEC) records, she is one of the Filipino owners of a shady offshore gaming corporation with an initial investment of P375,000.

She went to the Senate in Pasay on Wednesday, June 26, dressed in a maroon hoodie to say she is a vendor turned BPO worker who has never known offshore gaming, much less incorporate one.

“Wala po akong pinipirmahan na kahit anong papel. Wala akong alam paano mag-ano ng corporation, wala po akong kakayahan para magtayo ng corporation (I did not sign any document. I don’t know anything about incorporating, I also do not have the capacity to put up a corporation),” Castro said on Wednesday during the continuation of the Senate’s hearing into Philippine Offshore Gaming Operators (POGOs) involved in scam operations, trafficking and torture.

Castro was named one of the five owners when Hongsheng Gaming Technology incorporated in 2020 in Bamban, Tarlac. They set up shop as an offshore gaming company in a compound owned by Baofu, the real estate company incorporated in 2019 by suspended Bamban Mayor Alice Guo.

There are three other Filipino co-owners of Hongsheng, and one Chinese owner. Castro said on Wednesday she knows the other three Filipino women as market vendors in Concepcion town in Tarlac.

“Way back in 2018, I was living in Concepcion because I had a computer shop there. When I’d go to the market, even until now I see them. Rowena Evangelista sells vegetables, Thelma Laranan sells breakfast, Rita Yturralde sells grilled chicken,” Castro said in Filipino, adding that she was also a vendor before, selling barbecued intestines or isaw.

Castro said she wouldn’t know whether the three were incorporators of a POGO or not, just that she knows that she bought items from them in the wet market.

Senator Sherwin Gatchalian showed photos of the houses of the three women as indicated in their addresses in the SEC, all are modest houses.

“I believe they are not incorporators. These don’t look like the homes of POGO investors. Maybe investors of barbecue, banana cue, but not POGO,” said Gatchalian.

“It seems that Alice Guo is only the tip of an iceberg…This committee hearing is in the process of uncovering a deep and deadly web of bad actors, involving international criminal syndicates, local and national politicians, and perhaps, malevolent elements of a foreign state,” said opposition Senator Risa Hontiveros who has been leading this probe.

Lazy regulation and lack of political will

The Bureau of Internal Revenue (BIR) was able to verify on the spot that the Tax Identification Number (TIN) used by Hongsheng for Castro in the SEC records is a non-existent TIN. Castro presented her TIN ID, and BIR said that ID is the one that exists in their records.

Castro said her signature on the SEC records was forged.

Philippine Amusement and Gaming Corporation (Pagcor), as the main regulator of POGOs, was put on the spot for having allowed the likes of Hongsheng to obtain a license.

Senators were irked further because Castro and the other three women were included in the non-bailable qualified trafficking complaint filed against Guo and the other POGO officials. Gatchalian said the lack of oversight has endangered ordinary Filipinos like Castro.

“Under your guidelines, you have a probity check. If we can go to these houses one by one and see that they don’t have the capacity to invest in POGOs, why can’t Pagcor have done it? A simple inspection, why couldn’t you have done it?” Gatchalian said in Filipino.

Jessa Mariz Fernandez, Pagcor’s assistant vice president for offshore gaming licensing, said they used to just outsource their probity check services, which entailed checking documents.

“Probity check ng tamad yan (that’s a lazy probity check),” said Gatchalian.

Gatchalian soon turned his attention on Porac, Pampanga Mayor Jaime Capil under whose watch another POGO rose and operated criminal activities like trafficking and torture. The POGO was Lucky South 99, connected to Hongsheng via Dennis Cunanan, the former government official convicted for graft in the pork barrel scam. Cunanan was Hongsheng and Lucky South’s representative to Pagcor when they applied for their licenses in 2020.

It turns out that the local police of Porac once requested to inspect the Lucky South POGO, which Capil sanctioned in August 2023. However, they were barred entry into the compound. Capil said their hands were tied because they couldn’t trespass into the compound without a search warrant.

Gatchalian pointed out that the inspection wouldn’t have been requested if there was no suspicion of any wrongdoing and as mayor, Capil could have invoked his other powers as local chief executive, such as visitation powers and even sanitary regulations.

“Nag-mayor ako ng 9 na taon. Nagagawa ko iyon (na pumasok). Natatandaan ko noon na kung mayroong ayaw magpapasok, lalo akong nagdududa (I was mayor for 9 years. I can enter premises. I remember when they didn’t allow entry, the more that I got suspicious),” Gatchalian said, adding that Capil once restricted residents from swimming in a popular falls because of its threat to their health.

“You have the political will to shut down something. This was a popular falls, but for the welfare of your constituents, you shut it down. But for Lucky South 99, they didn’t let you in, you did not insist. You did not use your political will,” said Gatchalian in Filipino.

Capil said the falls was not owned by anyone, making it a different operation than a POGO.

‘Dangerous criminals’

Whether it’s lazy regulation, lack of political will, or the intervention of a foreign state, the Presidential Anti-Organized Crime Commission (PAOCC) says whatever it is, it has allowed “dangerous criminals to hide in plain sight.”

PAOCC chief Undersecretary Gilbert Cruz told the Senate that it’s been a usual occurrence in their raids to find evidence not only of tortured victims, but of torturers who turn out to be foreign fugitives.

PAOCC has in its custody 14 foreigners they are treating as persons of interest, who can potentially lead them to the masterminds. PAOCC is hunting down three more including Katherine Cassandra Ong who transacted for both Honghseng and Lucky South. Ong is also the one who recruited former presidential spokesperson Harry Roque to lawyer for Whirlwind, the real estate firm leasing its land in Porac to Lucky South.

“They have been here in the Philippines since 2005, and they predate the POGO phenomenon. They are not ordinary criminals. This is the first time that the secretariat of the commission are getting death threats that are nerve-wracking and chilling,” said PAOCC spokesperson Winston Casio.

“These are not ordinary money launderers, these are transnational criminals with records dating back decades in China, Hong Kong and Macau. How they are able to ally with local syndicates, we have yet to find out,” Casio said.

Casio said they are tracking the “big boss” but couldn’t be confident for sure if they will be successful in pinning him down. “They know a lot, they know our movements, they know so many things about us,” said Casio.

Casio said at one point there were over a thousand POGO operators who illegally put up operations, including transforming their initial tourist visas to stay in the country.

“We will draw out the links between Alice Guo’s companies and other criminal networks. We will look at the protectors of Mayor Alice, and we will spare no quarter,” said Hontiveros.

Hontiveros flashed during the hearing a group photo of Guo with former president Rodrigo Duterte. The senator believes the photo was taken when Duterte was already president.

“We don’t even need to establish that [Duterte] is a protector. It was during his time that the country opened up to POGO operations. Same goes for his colleagues, and other economic sectors outside the government,” said Hontiveros, although the senator adds they would still have to see if there is a need to invite the former president to the hearing.

In the meantime, senators reiterated their call to President Ferdinand Marcos Jr. to see POGOs as a security threat, and ban operations.

“Please, we have to ban POGOs. I-ban na natin ang POGO dahil hindi na natin sila kayang bantayan (let’s ban POGOs because we can’t control them any longer),” said Senator Grace Poe.

Hontiveros says the Senate committee is yet to determine if "it's necessary" to invite former president Rodrigo Duterte to the POGO hearings. pic.twitter.com/HIRSDRM3Rm

— Lian Buan (@lianbuan) June 26, 2024

– Rappler.com