The downfall of a Philippine mayor may be linked to Chinese gangs

Alongside the scam-farm allegations, Ms Guo has also been accused of faking 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 Filipina mother. But in June politicians claimed her name was Guo Hua Ping, and that she was a Chinese national who arrived in the country in 2003 with her family. Ms Guo then allegedly procured a fake birth certificate showing she was born in the Philippines. This allowed her to qualify for a passport and run for mayor. The solicitor-general is now seeking to cancel this birth certificate. Ms Guo’s lawyers vow to provide “substantial evidence” of her Philippine citizenship.

The claim that she is a Chinese spy is dubious. As hostilities increase between China and the Philippines, some Filipino politicians accuse Ms Guo of being a proxy of the Chinese government. Others have speculated that the Chinese Communist Party secretly supports criminals of Chinese origin in South-East Asia because they steal billions from Westerners through their online cons.

But there is no evidence of this, according to law-enforcement officials in the Philippines and elsewhere in Asia. Although the Communist Party has a record of working with organised crime, especially in Hong Kong, it has long been opposed to the gangs which have set up shop in South-East Asia. The Hong Kong triads sometimes help further the party’s aims. The criminals in South-East Asia do not.

The reason these gangs are in South-East Asia is that the Communist Party forced them out of China. When Xi Jinping became leader of China in 2012, he launched a crackdown on corruption and organised crime, including in Macau, the world’s largest gambling centre 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 mostly targeted punters in mainland China, where gambling is illegal. The groups then expanded into scams.

Indeed, China’s government is infuriated that these criminals continue to target Chinese nationals. Billions of dollars have been stolen from ordinary Chinese at a time when the economy is stagnating and the party is trying to curtail capital outflows. The Supreme People’s Court, China’s highest judicial authority, prosecuted more than 300,000 people in 2023 for crimes related to online scams. Behind closed doors, China urged the Philippines to shut down its POGOs, according to government officials. When President Ferdinand Marcos finally banned POGOs in July, the Chinese embassy in the Philippines welcomed the decision, even as tensions between the two countries soared in the South China Sea.

Ms Guo’s links appear to stretch beyond China and the Philippines. In August last year Singaporean police arrested ten people in the country’s largest-ever money-laundering bust. They seized $3bn in luxury properties, cars, gold bars and cash. Zhang Ruijin and Lin Baoying, two of Ms Guo’s business partners at the scam compound in Bamban, were convicted in the money-laundering case in Singapore.

In Bamban the POGO complex, which is visible from the mayor’s office, dwarfs the town. The enclosure of 36 buildings includes office towers, a shopping mall, dormitories and luxury villas reserved for the criminal ringleaders. Police rescued more than 800 people when they raided the site in March. When your correspondent visited after the raid, dusty BMWs and Mercedes were impounded beside a now-empty swimming pool.

Questions remain. Sherwin Gatchalian, one of the senators leading the campaign against online swindles in the Philippines, argues that POGOs are run by the same shadowy group but have different enablers across the country. Ms Guo, he thinks, was one such collaborator: an adept politician who navigated the corruption that permeates the Philippines. Mr Gatchalian has urged Ms Guo, who was sent back to the Philippines on September 6th, to expose her co-conspirators and any officials who protected her. The net may yet widen.