Chinese Gambling Syndicate Arrested

A gambling syndicate noticed the way that some online bookmakers behave when customers start losing money. It led to a syndicate cashing in on the ‘loophole’ to cash in nearly $4.6 million. That’s come to an end though as Chinese police in Wenzhou City have made arrests.

How did they allegedly earn so much money? Well, the method the syndicate used was to buy up hundreds of accounts that had been making losses. But why would they do that and how did it see them winning so much?

The ‘core figure’ of the syndicate is someone only known so far as ‘Shi.’ He was the owner of an internet café in Wenzhou. It’s alleged that the café owner hasn’t had the best of gambling records. Time spent on several sports betting sites had seen him make heavy losses. Bad news of course but then It’s alleged that Shi made a discovery.

He found that if a gambler was having a bad patch and losing a lot of money, some bookmakers were then willing to give the struggling customer plenty of offers. The plan being of course to keep the custom of the customer.

Such offers include cashback on losing bets (because that’s what the customer is doing at present), instant betting features and unlimited withdrawals. It’s also possible that the gambling company may be more likely to accept larger bets as the customer tries to win back what he’s lost.

July of last year saw Shi get in touch with an associate identified only as ‘Zhou.’ He requested that his associate place some advertisements online. They would ask for as many ‘losing accounts’ in return for up to yuan 5,000 ($782) every day just by handing over the information that would allow the purchaser to get into the losing accounts.

This wasn’t as easy a task as it sounds. Some accounts needed facial recognition to gain access to them. It’s said that Shi found a solution to this problem by having several account holders live in a villa owned by his father. It’s believed that over 200 account holders from all over the country of China gave access to their accounts.

Shi needed more help with this project. He next contacted a gambler named ‘Wang’ who lived in the Hainan Province of China. The pair formed a team that consisted of more than 12 gamblers and sports betting analysts.

These experts then spent time going around Europe and Southeast Asia exploiting the instant-betting function. They also took advantage of the short latency of data feeds and broadcast.

The group had been operating for seven months before the Wenzhou police stepped in. They arrested 69 suspects and confiscated 136 mobile phones and 35 computers. A sum of nearly $3 million has been frozen.