Proxy betting has become an increasingly popular way for mainland China players to gamble amid continued scrutiny of high rollers in Macau.
Southeast Asia.- Proxy betting has become an increasingly popular way for mainland China players to gamble amid continued scrutiny of high rollers in Macau and after it was banned in Macau, the practice has proliferated in other Southeast Asian destinations.
Proxy betting poses new challenges to financial watchdogs hoping to stop money laundering and new opportunities for casino operators and junket promoters to engage their customers and expand their profits.
Global Market Advisors estimates Macau’s proxy betting volume grew 15 percent last year, whilst overall VIP revenue fell 40 percent. Morgan Stanley MS +1.27 percent estimates 8-10 percent of Macau’s VIP revenue came from proxy betting, before the government banned it in May.
According to a white paper by Global Market Advisors Partner Shaun McCamley, a digital gaming pioneer and former president of Vietnam’s The Grand- Ho Tram, ever since Macau banned proxy betting, much of the business has migrated to Southeast Asia, especially the Philippines, Vietnam and Cambodia.
The report estimates an eight table proxy betting operation would cost US$65,000-80,000 and pay for itself within five months. Markets in Southeast Asia, strategically placed between the region’s economic giants, China and India, still have vast untapped proxy gaming potential, the white paper found.
The area has become a very competitive gaming environment, among the 10 member ASEAN grouping, only Thailand, Indonesia and Brunei don’t have legal casinos, that often restricts casino size according to capital investment. Proxy betting offers casinos and junket promoters a new revenue stream from existing tables and generally falls into a legal gray area.