Alleged $1.8B Cross-Border Gambling Scheme in Macau Infiltrated, 30 People Detained

Posted on: December 30, 2020, 08:56h. 

Last updated on: December 30, 2020, 09:39h.

Devin O'Connor @CasinoorgDevinO Read More
Expertise: Asia Pacific Gaming, Commercial Gaming, Legislation, Politics.

Police in Macau say they, along with assistance from mainland authorities, have successfully infiltrated an alleged cross-border gambling scheme that moved CNY11.62 billion (USD$1.8 billion) into the enclave undetected.

Macau casino gamblers crime
Police say an illicit operation that provided gamblers in Macau with a way to get quick cash has been taken down. (Image: Macau Photo Agency)

Macau’s Judiciary Police announced this week that 30 people have been apprehended on charges of using illegal point-of-sale (POS) terminals to move money from China to Macau. Police say the defendants rigged the handheld bank payment machines to register the transaction as being made on the mainland instead of the enclave.

This joint operation has successfully dissolved the whole cross-border criminal group. Our unit will charge these 30 suspects with the crime of committing computer fraud and being involved in organized crime,” said Macau Judiciary Police spokesperson Cheong Kam Fai.

Cheong’s comments were first reported by GGRAsia.

Along with smaller transaction fees, the POS terminals allowed the gamblers to move their money out from under the People’s Republic into the tax haven that is Macau. Gamblers would make card purchases for high-value items at jewelry and pawn shops, and then return the items for cash.

Face Substantial Penalties

Police say the alleged illegal POS operation began back in 2016. Authorities believe the $1.8 billion in transactions resulted in the operatives pocketing CNY69 million (USD$10.6 million).

The retail shops, which were located near casinos, charged a fee under the gift purchase and return for cash conspiracy. Law officers said the group had representatives active in Macau and on the mainland.

Of the 30 people arrested, 12 are Macau residents, and the other 18 call the mainland home.

According to China’s Criminal Law, “Whoever commits … organized crimes of the underworld … are to be sentenced to not more than five years of fixed-term imprisonment or criminal detention, and are to be in addition or exclusively sentenced to a fine not less than five percent and not more than 20 percent of the amount of money laundered.”

The charge for committing computer fraud also has severe potential penalties.

“Whoever violates state’s regulations and deletes, alters, adds, and interferes in computer information systems, causing abnormal operations of the systems and grave consequences, is to be sentenced to not more than five years of fixed-term imprisonment or criminal detention,” the Criminal Law reads. “When the consequences are particularly serious, the sentence is to be not less than five years of fixed-term imprisonment.”

Gambling Offensive

China has had enough of watching tens of billions of dollars flow outside its borders to foreign casinos each year. The country recently amended its Criminal Law to impose lengthier prison terms against those found guilty of organizing cross-border gambling trips.

While Macau’s economy almost entirely relies on its casinos, China has urged the enclave to diversify and become less dependent on gaming. Macau was in the process of trying to develop its own yuan-denominated stock market when COVID-19 hit. That goal has the support of lawmakers in Beijing, as well as President Xi Jinping.

A stock market would presumably bring new business to the region, as companies would establish presences near the trading center.