Police shut down PCSO outlets, arrests made

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Metro Manila (CNN Philippines, July 27) — Authorities on Saturday began closing down lotto and other gaming outlets of the Philippine Charity Sweepstakes Office (PCSO) at President Rodrigo Duterte's order.

"[T]he Philippine National Police (PNP) chief General Oscar Albayalde has immediately directed all Police Regional Offices nationwide to launch a massive crackdown against illegal gambling and arrest anyone who will continue to engage in illegal acts," the PNP said in a statement.

"We encourage the public to report to the police any suspected illegal gambling activity in their communities," it added.

Police officers placed barricade tapes on PCSO outlets in Metro Manila, Bicol, General Santos City, and other parts of the country. Top cop Albayalde himself made rounds in Baguio City to make sure that all PCSO-accredited Lotto, Keno, and small time lottery outlets in the area have stopped their operations.

Metro Manila police chief Major General Guillermo Eleazar said at least five people were arrested in the National Capital Region.

“Well, the instruction of the President as relayed by the chief PNP is to arrest yung mga employees, pati itong mga nangongkolekta ng bets (including those who collect bets)," Eleazar said.

This follows the President's verbal order late Friday evening to immediately stop all gaming operations, licenses and franchises of the PCSO, as he alleged corruption of the state charity fund. Small town lottery and other gambling activities authorized by the PCSO have been declared illegal. Duterte also ordered the military and the police to arrest anyone who will violate his order. Some lotto outlet owners voluntarily closed their kiosks upon learning of the President's pronouncement.

"Those businesses that continue to operate in connection with the franchises, licenses, concessions granted by the PCSO are hereby warned to cease and desist from engaging business, following the provisions stipulated in their franchises or face consequences under existing laws," Eleazar said.

PNP Spokesperson Bernard Banac said that they are also operating under a written order from PNP Chief Oscar Albayalde.

"Ang ating PNP chief si General Oscar Albayalde ay nagbigay ng direktiba sa aming regional offices through verbal and written order," Banac told CNN Philippines Newsroom.

[Translation: PNP Chief General Oscar Albayalde gave the directive to our regional offices through verbal and written order.]

Banac said the PNP will continue its operations on Sunday.

PCSO to appeal

PCSO officials on Saturday committed to comply with the President's order, informing stakeholders about the closure of outlets.

"To our valued customers, please be advised that our PCSO games are suspended pursuant to the directive of President Rodrigo Roa Duterte. All players with advanced play tickets are advised to keep their tickets until further notice," recently appointed PCSO General Manager Royina Garma said in a video message.

She, however, stressed that the PCSO will appeal to the the President for the resumption of its games, "for the interest of the PCSO, its agents, and its beneficiaries."

The PCSO was created in 1954 to raise funds for health programs, medical assistance and services, and government charities from sweepstakes races, lotteries, and other similar activities. It is under the Office of the President.

State auditors have earlier flagged alleged irregularities in the use of the charity fund. Duterte recently appointed Cebu City Police Office Director Col. Royina Garma to head the PCSO, replacing Alexander Balutan who had a controversial stint. Balutan was accused of improper spending, particularly for the lavish Christmas party he threw for the government agency in 2017. Balutan , however, said the government even saved millions of pesos for that party, spending only ₱6.3 million from an approved budget of ₱10 million.

Justice chief orders probe

Duterte did not specify the corruption allegations that prompted him to issue an unprecedented order to stop all PCSO gaming operations. Presidential Spokesperson Salvador Panelo said 60 percent of PCSO revenues are lost to corruption, and that the President will soon reveal the modus operandi.

"All players, all participants of the gaming corporations are involved, including even court [that] issues injunctions in favor of these operations," Panelo said in an interview with CNN Philippines.

Justice Secretary Menardo Guevarra said he has ordered the National Bureau of Investigation to conduct an in-depth probe into the supposed anomaly. He said he too was "surprised" by the President's move, noting that it could be a "temporary suspension only."

Senate President Vicente "Tito" Sotto III in a statement sent to CNN Philippines said he is supporting the President's move "because of the gross dishonesty and deceit the government is experiencing from these operators."

University of Santo Tomas Faculty of Civil Law Dean Nilo Divina stressed that is "completely within" the President's prerogrative to suspend the PCSO-licensed operations, "but I would like to believe that this will be supplemented by an implementing memo."

Panelo said the President will put his order into writing soon.

CNN Philippines' Gerg Cahiles and Paolo Barcelon contributed to this report.