Macau casinos to stop junkets at world's biggest gambling hub - Bernstein
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FILE PHOTO: A night view of the Casino Lisboa after gambling recommenced at midnight, in Macau, China February 20, 2020. REUTERS/Aleksander Solum
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By Eduardo Baptista
HONG KONG (Reuters) - Macau's gaming regulator has ordered junket operators in the world's largest gambling hub to stop offering credit to customers, according to brokerage firm Bernstein.
Macau's Gaming Inspection and Co-ordination Bureau (DICJ) has ordered the operators, who bring big-spending clients from mainland China to VIP rooms in Macau casinos, often with loans to gamble with, to stop offering credit, Bernstein said in a research note on Monday, citing sources.
"Wynn and others are in the process of shuttering junket operations," Bernstein said in the note.
Separately, Bloomberg News reported on Tuesday, citing unidentified sources, that Wynn and Melco would close their junket rooms by Dec. 20 and Dec. 21.
Macau's gaming regulator did not respond to a request for comment.
Casino operators Wynn Macau, Sands China, Galaxy Entertainment, SJM Holdings and Melco International Development also did not respond to requests from Reuters for comment.
The news comes days after embattled junket giant Suncity closed all of its VIP gambling rooms in Macau after its chief executive, Alvin Chau, was arrested over alleged links to cross-border gambling.
Authorities in mainland China, where gambling is illegal, see junkets as responsible for helping to siphon billions of yuan overseas, a risk to a country that has always had strict controls on capital outflows.
Carlos Lobo, a Macau-based gaming consultant, said if the Macau government did make junkets stop offering credit to clients, it would mark the end of an era.
"If this is true, the junkets will have to operate as a travel agency, through activities such as receiving fees for bringing rich clients to casino operators, rather than receiving commissions from VIP gaming rooms which has been the main business model for years," he said.
(Additional reporting by Anne Marie Roantree; Editing by Robert Birsel)
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