More than $30mn of the money hackers stole from the Bangladesh central bank’s account at the New York Fed was delivered in cash to a Chinese casino junket operator in Manila, officials told a Philippines Senate hearing yesterday.
A further $50mn was split between a casino resort and a gaming firm in the Philippines, where bank accounts that first received the funds were opened in 2015 as part of what officials now believe was an elaborately planned laundering scheme.
“Our money trail ended up at the casinos,” Julia Bacay Abad, executive director of the Anti-Money Laundering Council, told the open hearing.
She said her agency had frozen 44 accounts connected to the case and had requested assistance from the US’ Federal Bureau of Investigation (FBI).
Teofisto Guingona, head of the Senate’s anti-corruption committee, said ahead of the hearing that cash deliveries were made to an ethnic Chinese man over several days from a foreign exchange broker.
These were made up of 600mn pesos ($12.87mn) and around $18mn, which meant the junket operator would have received a haul made up of at least 780,000 banknotes.
The details shine a partial light on what happened after last month’s cyber-heist of Bangladesh Bank’s account at the Federal Reserve Bank of New York, which netted hackers more than $80mn.
The hackers tried to withdraw about $951mn from the account but the other transactions were blocked after a typo in one of the instructions raised red flags.
Bangladesh Bank suspects the money was sent to the Philippines in four tranches and, once there, was diverted to casinos. It has said it is working with the anti-money laundering authorities in the Philippines to recover the funds.
The Philippines’ Rizal Commercial Banking Corp (RCBC) said last week it was investigating $81mn deposited at one of its branches.
Senator Guingona said the transfers into RCBC were subsequently consolidated into one account and some of the money was converted to pesos.
CCTV cameras at the branch were not functioning when the money was withdrawn, RCBC’s anti-money laundering head, Laurinda Rogero, told the Senate hearing.
The president of a foreign exchange broker called Philrem Service Corp, Salud Bautista, told the hearing her company was instructed over the phone by the bank branch manager to transfer the funds to a man named Weikang Xu and the two casinos.
Guingona, the senator, said Xu was an ethnic Chinese foreigner but did not know if he was from mainland China.
Bautista said $29mn ended up in an account of Solaire, a casino resort owned and operated by Bloombery Resorts Corp. Bloombery is controlled by Enrique Razon, the Philippines’ fifth-richest man in 2015,
according to Forbes.
Silverio Benny Tan, corporate secretary of Bloomberry Resorts, told the hearing that the $29mn was transferred into a casino account under Xu’s name in exchange for ‘dead chips’ that can only be cashed in from winnings.
Bautista said a further $21mn went to an account of Eastern Hawaii Leisure Co, a gaming firm in northern Philippines. Eastern Hawaii officials were not
available to comment.
State prosecutors said a complaint has been lodged by the Anti-Money Laundering Council against the manager of the RCBC branch and the holders of accounts into which the money was originally deposited. A council official said that more people were likely to be named.
The branch manager, Maia Santos-Deguito, has denied any wrongdoing and in an interview with the local ANC TV channel said she was being used as a scapegoat.
Asked if she gave instructions to Philrem to transfer the funds, she told the hearing that she would answer all questions in a closed-door session if given the opportunity.
Senator Guingona said that because casinos are not covered by the country’s anti-money laundering laws it was not clear if the stolen funds could be
recovered.
“The paper trail ends there. That is the problem,” he said. “Right now we are at a dead end.”