Wednesday, July 1, 2015

Gambling on Hope

Fresh faced and wide eyed, I arrived in the Dominican Republic. It was my first time visiting in years.

The first person I wanted to see was my favorite cousin, Tati.
“Let’s surprise her at work” my aunt suggested.
“Let’s go!” I beamed, “Where does she work?”
“Right up the block, in la banca”
I looked to where my aunt was pointing, there wasn’t a bank in sight.
“No, not a banco, a banca” my aunt said.
“Oh yes, of course” I nodded, pretending to know the difference…

Bancas are small betting parlors found most prominently in the Dominican Republic. They process almost all types of gambling activity, from the national lottery to wagers on athletic competitions. Sport Bancas accept bets on local sports, as well as American athletic leagues such as Baseball (MLB), Basketball (NBA), Football (NFL) and even hockey (NHL)!

Bancas are usually very small in size but stand out due to their brightly colored storefronts, painted in cheerful shades of greens, blues and yellows. Inside, they are inhabited by a single clerk, who sits behind a glass window typing away in the computer used to record the bets.

Bancas are a fairly new phenomenon, with the majority emerging around 2006. By this estimate, most bancas are not even 10 years old. But boy have they spread quickly!

In the Dominican Republic alone, there are about 30,750 legal betting parlors. However, it is estimated that there is a similar figure of illegal establishments, bringing the total number to a little over 60,000 bancas in the country. In some areas, there are two or more bancas in a single street block, disregarding the law that states that Bancas must be located more than 400 meters apart.

Setting up a banca requires a permit, which may be expensive and difficult to obtain. Illegal bancas are more profitable for their owners because by setting up shop without a permit, they can keep most of the profit for themselves.

Dominicans wager about RD $300 million pesos, or the equivalent of $70 million US dollars on betting parlors a day. And this figure only accounts for the legal parlors. Assuming that the same figure is staked on illegal parlors, it can be said, as noted by Dominican news source, Dominican Today, that Dominicans are currently spending over RD $600 million pesos or $140 million American Dollars on gambling activities each day.

Let that sink in…

In a country characterized by poverty, where unemployment is currently at 15% and about 41% of the population lives on less than $1.25 a day, people are gambling the equivalent of the listing price of the most expensive mansion in the Hamptons on a daily basis.

Illicit gambling activity is not just limited to the Dominican Republic. Gambling is a growing problem in all of Latin America. Largely in part due to lax gambling laws and regulations, many Latin American countries are plagued by illegal street lotteries, unauthorized use of slot machines and a wide array of both legal and illegal casinos.

In Chile, for example, recent years have seen a boom in illegal slot machine parlors, known as neighborhood slots. There are about 150,000 slot machines accessible in local storefronts, even though the law restricts their use to casinos only. A similar issue occurs in Uruguay, where there are about 20,000 illegal machines located in neighborhood businesses nationwide. In Mexico, an estimated 107 of the nation’s casinos currently operate without a license.

Not surprisingly, gambling is a source of big money in these countries. Illegal slot machines in Uruguay generate an estimated $170 million a year, not counting the $240 million generated by legal slot machines. A Latin American Gaming & Gambling Report published by Research and Markets in 2011, estimated that if the legal and illegal gaming activities of Latin America were combined, they would generate over $150 billion dollars in revenue a year.

But who is this money going to? Certainly NOT to the people making the bets, that’s for sure.

Studies show that people who live in poverty gamble at a higher rate than those who are better off. It should come as no surprise then, that Bancas and gambling establishments like them, are most abundant in poor neighborhoods. Neighborhoods in which you may not find a paved road to walk in but you can expect to find several colorful betting parlors only steps apart.

So why do these people, who for all intents and purposes do not have the means to do so, continue to gamble? Are they stupid? Are they lazy? Or are they just people like you and I, driven by hope? Hope that things will get better. That luck will finally be on their side. That one day, “van a pegar una” and they will make it big. At the end of the day, isn’t that what we all hope for?

Originally Published in LatinTrends Magazine, May 2015

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