Korean authorities have busted a gambling ring based in Manila, the Philippines, that allegedly aired live Web coverage of its casino in Manila to viewers in Korea and earned more than 100 billion won in the process.
The Seoul Central Prosecutors Office confirmed Saturday that it had indicted without bail four suspects on the charge of illegal gambling. The suspects allegedly allowed Korean Internet users to bet on the games webcast in real time.
The ringleader of the scheme, identified only as Lee, opened a casino in Manila in February last year. His staff purchased three casino tables and webcasting devices, and hired around 30 Filipino dealers. Then a webcast broadcast in real time of baccarat games at the casino was aired to viewers in Korea via nine gambling sites.
Lee exchanged Korean online gamblers money into cyber chips and then let them make bets while watching the webcast. Winners reportedly had to pay commissions of 95 to 800 percent to cash out based on how much they bet and on which side, banker or player, that they bet. A gambler was allowed to bet up to 120 million won.
As a result, certain online gamblers wired more than 100 million won for cyber chips.
The ring reportedly earned more than 100 billion won over the past 19 months until it was busted last month. Lee reportedly took half of the earnings and nine owners of relaying sites took 15 percent. The remaining 35 percent went to business partners who recruited gamblers via spam.
Considering the earnings they made, prosecutors estimated that around 500 billion won was probably gambled with.
To make a fortune in such a short amount of time, the ring used the news network CNN. To show online participants that the webcast gambling was live, the ring featured CNN on the corner of its online coverage.
Lee and his crew spent most of the money living a luxurious lifestyle. The rings assets of 12.3 billion won has been frozen, including 4.35 billion won in real estate, 3.45 billion in bank accounts and 850 million won worth of luxury cars including a Mercedes Benz and Porsche. Moreover, prosecutors seized 1.57 billion won in cash from the rings hideout in Korea.
Two ring members have fled abroad, but prosecutors will indict them in absentia to confiscate their illegal earnings. When their sentence is rendered in absentia, steps will be taken to have them extradited back to Korea and to trace their illegal assets.
Another gambling ringleader "Yoon" was also indicted for running an illegal gambling site. He opened servers in Japan and Thailand and collected commissions from online gamblers under the name of dealer commissions. Yoon reportedly earned 80 billion won until his arrest. Three of Yuns accomplices are on the wanted list after they fled to Malaysia.
Prosecutors said some of them have connections with one of the three large mob families in Korea, and a probe will determine if criminal organizations in Korea are involved in online gambling.