Philippine mayor’s fall may be linked to Chinese gangs

The small The city of Bamban in the Philippines is relatively unremarkable. But it has become a site of feverish headlines this year after allegations emerged that Alice Guo, who was elected mayor of the city in 2022, abused her position to protect online casinos operating there. Government officials have said the gambling centers were fronts for financial fraud, money laundering, human trafficking, kidnapping, torture and murder. In July, the 34-year-old Ms. Guo disappeared. She was arrested in Indonesia on September 3. Ms. Guo denies any links to criminal activity.

In addition to the farm scam allegations, Ms Guo has also been accused of falsifying her identity and being a Chinese spy. Ms Guo says she was born and raised on a pig farm in Bamban, to a Chinese father and a Filipino mother. But in June, politicians claimed her name was Guo Hua Ping and that she was a Chinese citizen who came to the country with her family in 2003. Ms Guo is said to have obtained a false birth certificate showing she was born in the Philippines. This allowed her to qualify for a passport and run for mayor. The attorney general is now seeking to have the birth certificate annulled. Ms Guo’s lawyers have promised to provide “substantial evidence” of her Filipino citizenship.

The claim that she is a Chinese spy is dubious. As hostilities between China and the Philippines escalate, some Philippine politicians have accused Ms. Guo of being a proxy for the Chinese government. Others have speculated that the Chinese Communist Party is secretly supporting criminals of Chinese descent in Southeast Asia as they steal billions from Westerners through their online scams.

But law enforcement officials in the Philippines and elsewhere in Asia say there is no evidence of this. While the Communist Party has a track record of working with organized crime, particularly in Hong Kong, it has long opposed the gangs that have established themselves in Southeast Asia. The Hong Kong triads sometimes help advance the party’s goals. The criminals in Southeast Asia do not.

The reason these gangs are in Southeast Asia is because the Communist Party has driven them out of China. When Xi Jinping became leader of China in 2012, he launched a crackdown on corruption and organized crime, including in Macau, the world’s largest gambling center by revenue and once a common destination for wealthy Chinese to launder their money. The Philippines became popular because of its proximity to China and the ease of running online casinos, known locally as Philippines Offshore Gaming Operators, or POGOs. These primarily targeted gamblers in mainland China, where gambling is illegal. The groups then expanded into scams.

The Chinese government is furious that these criminals continue to target Chinese citizens. Billions of dollars have been stolen from ordinary Chinese at a time when the economy is stagnant and the Party is trying to stem capital flight. The Supreme Court, China’s highest judicial authority, has prosecuted more than 300,000 people in 2023 for crimes related to online scams. Behind closed doors, China has called on the Philippines to POGOs, according to government officials. When President Ferdinand Marcos finally banned POGOIn July, the Chinese embassy in the Philippines welcomed the decision, as tensions between the two countries rose in the South China Sea.

Ms Guo’s ties appear to extend beyond China and the Philippines. In August last year, Singapore police arrested 10 people in the country’s largest money-laundering operation ever, seizing $3 billion worth of luxury properties, cars, gold bars and cash. Zhang Ruijin and Lin Baoying, two of Ms Guo’s business partners in the Bamban racket, were convicted in the Singapore money-laundering case.

In Bamban the POGO complex, visible from the mayor’s office, overshadows the city. The 36-building perimeter includes office towers, a shopping mall, dormitories and luxury villas reserved for the criminal gang leaders. Police rescued more than 800 people when they raided the site in March. When your correspondent visited after the raid, the dusty BMWs and Mercedes were seized next to a now empty swimming pool.

Questions remain. Sherwin Gatchalian, one of the senators leading the campaign against online scams in the Philippines, argues that POGOs are run by the same shadowy group, but with different accomplices across the country. Ms. Guo, he believes, was one such collaborator: a skilled politician who managed to circumvent the corruption that pervades the Philippines. Mr. Gatchalian has been encouraging Ms. Guo, who was sent back to the Philippines on Sept. 6, to expose her accomplices and any officials who protected her. The net could be widened. ■