Posted on: November 11, 2021, 08:08h.
Last updated on: November 11, 2021, 09:09h.
Chinese police in the eastern city of Wenzhou say they have disrupted a syndicate that illegally capitalized on an online sports book “loophole” to cash in the equivalent of around US $4.6 million.
Two Chinese police officers stand guard in Beijing in an image taken in 2009. Their colleagues in Wenzhou have disrupted a gambling ring that made $4.6 million in just seven months. (Image: Getty) The scheme involved buying up hundreds of money-losing accounts to exploit perks afforded to big-betting but unsuccessful gamblers, as reported by Wenzhou Evening News.
Police said the “core figure” of the gang was a Wenzhou internet café owner identified only as “Shi.”
Shi had previously lost “hundreds and thousands of yuan” via unnamed sports betting sites. But the experience taught him that once an account lost a huge amount of money, the operator would offer more enticements to keep the owner playing.
These included unlimited withdrawals, instant betting features, and a percentage back on losing bets. And of course, operators would also be more likely to accept large bets.
Shi realized if he could gain control of as many of these accounts as possible, he would have an edge.
There Shi Goes Again In July last year, Shi asked an associate, “Zhou,” and others to place web advertisements asking for as many “losing accounts” as possible. Respondents could earn 1,000 yuan (US$156) to 5,000yuan (US$782) per day for doing little more than providing the information necessary to access their accounts.
Some 200 account holders signed up to the plan from all over China.
In some cases, access required facial recognition, and so Shi arranged for many of the account holders to live in his father’s villa while the syndicate was in operation.
Next, Shi teamed up with a gambler called “Wang,” based in Hainan Province. Using his own resources, Wang formed a team of more than a dozen gamblers and sports betting analysts.
Team members would travel to sports events in Europe and Southeast Asia to exploit the instant-betting function, taking advantage of the short latency of broadcast and data feeds.
Beating the Bookies This would have allowed the team to bet on the changing odds of the final score of a soccer match after a goal had been scored, for example, faster than those watching it on a “live” feed.
A goal will always change the odds of the game’s outcome. But this may not be reflected at precisely the same time at different sports books. This provides a window for arbitrage, and for a quick-fingered gambler to make money.
According to police, Shi’s team was responsible for managing the accounts and account holders, and Wang’s team was responsible for betting and gambling. Meanwhile, Zhou was allegedly the money man. He purchased nearly 3,000 bank cards for the syndicate’s use.
Wenzhou police said they have so far arrested 69 criminal suspects and seized 35 computers and 136 mobile phones used in the crime. That while freezing the equivalent of around $3 million in funds.
The group was in operation for just seven months.