Articles
High Stakes: Kidnapping in Macau
Due to an increase in kidnappings over gambling debts in Macau, major hotels andcasinos have shown an interest in KR insurance policies to guard against the legal liability associated with such incidents, writes Mandira Bagwandeen.
Incidents of kidnapping have been reported in Macau, as increasing law enforcement and decreasing disposable incomes in China have encouraged junket operators to issue gambling loans to those less able to pay their debts. Operators have reportedly resorted to kidnap to recover some of these funds.
Macau’s junket system is founded on Chinese regulations which limit the funds mainland visitors can legally take to Macau. The system enables companies or individuals to loan credit to high-rolling gamblers on behalf of Macau’s casinos. However, junket operators have been less busy recently due to two factors. A government crackdown on corruption and illicit transactions has increased reluctance to gamble in Macau due to fears of being apprehended for fraudulent money exchange. Secondly, as a result of a slowing economy, previously-flush Chinese citizens no longer have the same disposable income to spend. These dynamics have reportedly decreased visitor numbers, and caused mainland visitors to visit other casinos in Asia instead. Desperate to make a profit, junket operators have resorted to lending money to those less able to pay their debts easily. This has driven an increase in the number of gamblers being kidnapped to recover these debts.
Information and statistics related to these alleged kidnappings is limited. However, some kidnappings reportedly occur in hotel guest rooms attached to casinos and the victim is generally held until family or friends accumulate enough money to settle debts on the hostage’s behalf. The perpetrators apparently only seek to be paid the outstanding gambling debts and generally do not ask for high ransoms. According to Wong Sio-chak, Macau’s Secretary for Security, most of the offenders and victims are mainlanders. Major hotels and casinos have reportedly expressed interest in kidnap for ransom insurance, including allowance for the deployment of crisis responders to resolve kidnapping disputes, purportedly guarding venues against legal liability that could result in lawsuits from the victim or their family members. It remains to be seen whether this is a pre-emptive measure, or a practice that will become increasingly common in the industry.