Jun 17, 2010 (06:06 AM EDT)
China Grapples With Online Gambling
Read the Original Article at InformationWeek
China is stepping up its efforts to crack down on online betting as gambling syndicates try to cash in on the World Cup.
"The World Cup and other sporting contests will provide momentum to online gambling activities," the deputy chief of China's Ministry of Public Security's Internet security division, Gu Jian, said in a media briefing.
Gambling has been illegal in China ever since the Communist Party came to power in 1949, but it is still a thriving underground industry. The government would especially like to cut down on betting in soccer. Gambling, match-fixing and corruption have all severely marred the country's top professional soccer league, the Chinese Super League.
There are many links in the chain of illegal internet gambling, including website developers, hosting platforms, advertisers, and members. Xu Jianzhuo, Director of Network Security Protection Service at the Public Security Investigation Agency, said it's easy it is to open personal gambling sites, which exacerbate the spread of online gambling.
Xu points out that an integral part of the problem lies with third party payment platforms, often ignored by banking supervision. Some of these are knowingly participating in illegal activities but it is extremely difficult to obtain valid evidence to prove this, he said.
In the crackdown, police around China said that they have already caught more than 180 suspects from outside mainland China, including citizens of Malaysia, the Philippines, Taiwan, Hong Kong and Macau.
And in two major Chinese cities, Shenzhen and Chengdu, police said they acted in unison to take down a major online gambling ring. They said they caught a total of 34 suspects and seized $11.7 million in funds.
Including that raid, Shenzhen police said they have uncovered eight online gambling syndicates in the past two months, five of which were running operations totaling more than $14.6 million.
Despite the efforts, China's gambling problem will not be tackled overnight. As much as $73 billion was spent on online gambling in China the last time the World Cup was held in 2006. Gu added that judicial and security officials will meet to discuss new sentencing standards for online gambling. Offenders currently can be punished for three years or less and assessed a fine, while the time in prison increases to three to 10 years for serious offenses. The law, however, is not specific about what constitutes a "serious" offense.