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MANILA—In the main gambling hall at the Solaire Resort & Casino here one recent afternoon, hundreds of casual gamblers tried to win enough at the baccarat tables to pay for their weekend.

But the real action happens upstairs, in a small but high-end part of the Philippines casino scene that is now drawing scrutiny from Filipino and foreign investigators. There, major junket operators from China and Macau bring guests to seven VIP rooms, decorated with paintings, and their ceilings studded with crystals. Croupiers wait in silence for players who might win or lose millions on a roll of the dice or the turn of a card.

These rooms, critics say, represent a loophole in efforts to stem the flow of ill-gotten money through the country.

The Philippine Amusement and Gaming Corp., or Pagcor, which is both the industry regulator and a casino operator, succeeded in exempting casinos from new anti-money-laundering regulations when they were introduced in 2013. That means large amounts of untraceable cash can wash through without casino operators having to identify its source or report it to financial regulators—something which simplifies business at the casinos, but also opens the door to money launderers.

This loophole was exploited in February, Philippines investigators say, when millions of dollars stolen from Bangladesh’s central bank were used to buy large volumes of chips used in high-stakes VIP junket rooms at Solaire and another Manila casino.

The saga began early this year when investigators found that hackers planted malware on computers at the central bank’s Dhaka headquarters and accessed an international funds-transfer system. On Feb. 5, someone instructed the New York Federal Reserve to withdraw $951 million from Bangladesh Bank’s account there, transaction records show.

Some $81 million went to bank accounts in the Philippines and $20 million to Sri Lanka before the New York Fed stopped the payments, records show.

The money directed to Sri Lanka was intercepted and returned.

But in the Philippines, efforts to trace the cash have been hampered because money was transferred to junkets operating in the casinos, according to testimony at Philippines Senate hearings on the theft.

“It’s not hard to imagine why those guys chose Manila to clean their money,” said Ben Lee, a gaming-industry analyst at Macau-based consultancy IGamiX.

In other jurisdictions, notably Macau, the world’s biggest gambling center by revenue, anti-money-laundering legislation does apply to casinos. Authorities in the southern Chinese territory recently stepped up enforcement of the laws there amid a crackdown on corruption initiated by China’s communist leaders.

“We have to put more teeth in our laws so we could stop criminal elements from exploiting the deficiencies in our existing laws,” Emmanuel Dooc, a member of the Philippines’ Anti-Money Laundering Council, told the Senate hearings. “There are gaping holes in our law. We have to include casinos as covered entities” under the anti-money-laundering law, he said.

Operating like a casino within a casino, a junket lures high rollers to play in its exclusive gambling rooms and guarantees a casino a set amount of revenue. Junkets propelled Macau’s success, and Pagcor won a small slice of this business after lobbying for the money-laundering exemption for junkets and casinos.

The Solaire was the first privately operated casino opened on Manila’s seafront in 2013, by ports magnate Enrique Razon Jr. It was followed by City of Dreams, operated by Laurence Ho and James Packer, sons of billionaires Stanley Ho and Kerry Packer. Japanese pachinko billionaire Kazuo Okada is currently building a $2 billion casino nearby. Total gambling revenue rose 17% to $2.78 billion last year, according to Pagcor—though still a fraction of Macau’s $29 billion 2015 casino take.

One junket operator, Kim Wong, a Chinese national who has lived in the Philippines for decades, told the Senate inquiry that he helped clients from China open the bank accounts that received the stolen money, but said he had no idea where the money originated. The Philippines’ Anti-Money Laundering Council has filed a criminal complaint against Mr. Wong, who denies any wrongdoing and has since handed over to the council $15 million he received from his clients.

Macau-based junket Gold Moon said it received some of the money. In one instance, it issued 100 million pesos ($2.1 million) of chips for use at its Solaire VIP rooms, a lawyer for Gold Moon told the Senate hearings. Another chunk went to another Macau-based junket, Suncity, whose lawyer told the hearings that it was still checking how much it received.

In Gold Moon’s VIP room, two Chinese high-rollers allegedly gambled 33 million pesos worth of the chips during a marathon two-day stint, turning that into 38.5 million pesos before leaving, according to the junket’s lawyer. The other 67 million pesos in chips remain unaccounted for, according to the casino. Gold Moon’s attorney said the two men may have walked out with the chips and could have sold them to other gamblers.

Solaire declined to comment. Midas, a Pagcor-run casino where investigators say another $11 million of the stolen Bangladesh money was gambled, didn’t respond to requests for comment.

Executives at Pagcor have said stricter anti-money-laundering rules for casinos wouldn’t have stopped the stolen money entering the VIP junket rooms. They blamed banks for failing to stop the funds entering the country.

The Philippines’ central bank Gov. Amando Tetangco has said the bank will work with the nation’s Congress to enhance money laundering laws.

—Yang Jie contributed
to this article.

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