China busts massive cross-border online gambling ring that handled $78b in wagers

china-taiwan-online-betting-bustAuthorities in China have broken up a massive cross-border online gambling ring they claim handled over $78b in wagers from nearly one million customers.

On Tuesday, China’s Ministry of Public Security announced that it had arrested 98 suspects involved in a network of over 500 betting websites. Police said the investigation, dubbed Operation 109, had begun rounding up the conspirators in July but official word is only now emerging.

Police said their investigation began in August 2014 when an officer in Hunan province caught one bettor logged on to a betting site via an internet café. In March 2015, police formed a special investigation team to track down the ringleaders. A 40-year-old Guangdong resident named Xu has been fingered as the operation’s top man.

The operation reportedly based its main servers in Taiwan, although the technical team was run from a mainland technology firm in Shenzhen, while customer service teams operated out of Hong Kong, Thailand and the Philippines. China’s ‘renegade province’ Taiwan has been cooperating with mainland authorities on similar busts since 2013.

The ring’s sites were heavily disguised as password-protected intra-company email or financial systems, and even members with passwords had to burrow several layers deep — including entering a specific set of search criteria – to find the sites’ actual gambling interface.

The authorities claim the operation extended credit to over 120k registered customers. Winnings were delivered in person, while losing bettors were required to forward their stakes to the operation’s bank accounts. Police reportedly seized accounts tied to the ring at 14 commercial banks, while freezing another 3k accounts tied to individual gamblers.

This has been a banner year for Chinese authorities in their ongoing war against illegal gambling operators. In January, police in Shandong province took down an online gambling ring that handled $9.7b in wagers, much of it with live-dealer baccarat operations based in other countries. This spring, over 1k individuals were arrested for their links to a Thailand-based online betting operation, which also had ties to Taiwan.

In August, police announced their dismantling of an online betting ring tied to fugitive Wang Bo as part of the country’s desire to ‘clean the internet’ of illegal activity. Seems the authorities’ brooms still have a lot of dust left to pick up.