At the beginning of the year, the figure of 600 billion yuan
(US$72.5 billion) shocked the country.
This was the amount of money that flew overseas through gambling
annually. It is 15 times the overall volume of welfare and sports
lotteries in 2003, and equal to the total revenue from tourism in
2004, according to Peking
University's China Public Lottery Research Institution.
An anti-gambling campaign launched nationwide in January
resulted in 23 big cases supervised by the Ministry of Public
Security, 13 of which were Internet-related cases in Beijing,
Shanghai, Liaoning, Jiangsu, Fujian, Guangdong, Jilin and
Guizhou.
On January 20, Beijing police said that half of 10 gambling
cases they cracked in the campaign were involved with online soccer
gambling.
Till March 3, over 317 Internet gambling cases, involving 1,137
people, were solved. Sixty-eight people were arrested, 250 are in
custody, 123 bailed for trial, 62 reeducated through labor and 250
punished, said sources from the National Anti-Gambling Coordinating
Team. The money involved totaled over 1.7 billion yuan (US$205
million).
However, insiders say that the estimated total is a little
conservative, since domestic agents only get a small proportion of
gambling funds, while much is remitted overseas through illegal
financial channels like underground banks. The amount lost every
year is uncountable.
Companies eye the Chinese market
In 2000, online gambling started to penetrate China, first
appearing in provincial capitals and big- and middle-sized cities
where the economy and Internet were comparatively developed. Soccer
gambling quickly became the most dominant form.
"Not all overseas gambling websites regarded China as a
potential market at first," said Xu Yong, an official from the
coordinating team, "However, after some websites reaped huge
profits, the rest shifted their attention to China one after
another. Chinese websites also followed suit."
In two to three years, the numbers of gambling websites,
bankers, agents and members all sharply increased. Gamblers not
familiar with the Internet could bet via phone, short message and
fax, and many who neither knew nor liked soccer could hire other
people to gamble for them.
After May 2003, the "sword campaign" was started to target
Chinese who were gambling overseas. It forbade leading Party and
government officials, civil servants and senior executives of
state-owned enterprises and public service units from going
overseas for gambling and achieved positive results.
To get around new restrictions, some hired overseas agents via
the Internet to gamble by "remote control" from China.
New challenges for law enforcement
Agents at different levels of online gambling firms don't
usually meet other agents and members in person, so a high level of
secrecy is maintained. They use virtual hosts for their
advertisements and change websites and domains continually. Once
they go offline or switch off their computers much evidence gets
lost, so police have to catch suspects while the latter were
betting online.
The coordinating team disclosed that the Ministry of Public
Security, together with telecom companies and the China Banking
Regulatory Commission, will strengthen supervision of online
gambling information and forbid any capital transfer to the
accounts of gambling websites through credit cards or banks.
A special judicial appraisal center on digital data will be set
up to improve judicial awareness of the kinds of evidence used in
online gambling cases.
Public security departments nationwide now have more experience
in targeting suspects, ascertaining the channels used to transfer
gambling funds, recognizing the relationship between upper and
lower agents and acquiring digital evidence.
"The penalty for online gambling should be strengthened," said
Jing Di, preliminary judge in the high profile Fu Xiangrong
case.
According to Article 303 of the Criminal Law, any person who
aims to profit from collective gambling, establish gambling houses
or take gambling up as a profession will be liable to a maximum of
three years in prison and fines, even if their crimes involve
hundreds of millions of yuan.
"Such penalties don't?match the amounts," said Xu Chenglei
from the coordinating team, "Online gambling and the tremendous
profits involved weren't foreseen when the legislation was
made."
The coordinating team hopes that legislators can amend the
Criminal Law and solve what they see as a legal bottleneck.
(China.org.cn by Tang Fuchun, March 22, 2005)