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It’s unclear why the central bank, the Peoples Bank of China (PBOC), hasn’t cracked down harder on the practice, although the documents Reuters reviewed show the bank was aware it had become a growing problem.

Industry experts point to a weak enforcement culture in China, a reluctance to hurt Macau financially with 80 percent of the city’s revenues drawn from gambling, and a willingness to tolerate some capital flight - especially if it can be tracked through names on bank cards.

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“The problem you are talking about has existed for several years,” said the executive, who spoke on condition of anonymity.

In a warren of gritty streets around Macau’s ritzy casino resorts, hundreds of neon-lit jewellery, watch and pawn shops are doing a brisk business giving mainland Chinese customers cash by allowing them to use Union Pay cards to make fake purchases - a way of evading China’s strict currency-export controls.A senior Union Pay executive said the Shanghai-based company has long been aware of the payment card abuse in Macau and elsewhere, but was limited in its ability to act.That’s because the primary responsibility lies with authorities in Macau or any other country where the fraud is taking place, he said.You can find much more information about your privacy choices in our privacy policy.Even if you choose not to have your activity tracked by third parties for advertising services, you will still see non-personalized ads on our site.

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