Macau grapples with the potential criminalization of unauthorized money exchange, particularly in the context of gambling. Striking a balance between allowing free currency exchange and combatting gains from illicit money exchange is a delicate task, considering the legitimate interests of Macau’s market economy and Chinese authorities’ concerns about cross-border currency flow.
Balancing Act:
Criminalizing unlicensed money exchange in Macau is a sensitive issue requiring careful consideration to align with Chinese authorities’ aims to control cross-border currency flow while respecting Macau’s open market economy.
A 2019 report by the city’s Public Prosecutions Office emphasized the need to balance the free exchange of currencies in Macau with efforts to combat gains from illicit money exchange.
Current Legal Status:
The illicit money exchange trade has thrived due to challenges in moving money for gambling from mainland China to Macau, primarily denominated in Hong Kong dollars.
Unlicensed exchange of money is presently punishable under Macau’s Financial System Act as a contravention, resulting in fines and public sanctions.
Views and Perspectives:
Observers suggest that criminalizing illicit exchange for gambling purposes is “doable” within the framework of a new law on illicit gambling, as mentioned in the city government’s 2023 policy address.
Some view illegal money-changers as “touts” who enable transactions by bringing mobile UnionPay POS terminals, often associated with manipulating cross-border money movement.
Financial Regulation Updates:
The amended Financial System Act, effective from November 1, does not include provisions for criminalization.
Addressing concerns about illicit money exchange aligns with the objectives of the revised Macau Gaming Law, emphasizing alignment with Macau policies against cross-border illegal flow of capital.
Proposed Solutions:
Alternatives to criminalization include strengthening supervisory measures and enforcing penalties more expediently.
Another potential solution is allowing the use of digital RMB within casinos, enabling authorities to monitor financial transactions more accurately and simplifying the currency exchange process.
By addressing concerns about illicit money exchange while considering legitimate economic interests, Macau aims to strike a balance that supports its market economy and aligns with regulatory objectives.