Saturday, South Korean officials from the Seoul Central Prosecutor’s office charged four individuals in connection with an illegal gambling ring. Authorities are holding the four suspects without bail while they continue to investigate the ring.
One of the suspects has been identified as “Lee.” According to prosecutors, he opened a land-based casino in Manila, the Philippines in February 2007. His staff then hired 30 Filipino dealers, and purchased three casino tables and several webcasting devices.
Prosecutors allege that the staff used the devices to broadcast live baccarat games via nine websites and accepted remote outside betting on the games from Korean citizens. The websites reportedly featured CNN broadcasts in the corner of their webcasts to prove that the games were live.
In order to accept the bets, the ring reportedly required that Korean bettors exchange their currency for “cyberchips.” The ring then required winning bettors to pay a 95- to 800-percent fee—depending on the amount they had wagered and whether they bet on the Player or the Bank—when they exchanged their cyberchips for currency.
Each gambler was allowed to bet a maximum of W120 million (€70,647), and many wired more than W100 million to the ring. Consequently, prosecutors say, the ring earned over W100 billion, and bettors risked an estimated W500 billion over the course of the 19-month operation. The Won (W) is South Korea’s national currency.
According to authorities, Lee took half these earnings. The remaining 50 percent was divided between the ring’s advertising “partners,” who received 35 percent, and the nine hosting sites’ owners, who shared a 15-percent take.
Prosecutors said Lee and his affiliates spent a majority of their profits living lavishly. They cited the W850 million in luxury cars seized—including a Mercedes Benz and a Porsche—as examples of the ring’s decadence. Korean authorities also seized W4.35 billion in real estate and W1.57 billion in cash recovered from the ring’s hideouts. And they have frozen W3.45 billion remaining in the group’s bank accounts. All-tolled, South Korean officials confiscated W12.3 billion in assets belonging to the ring.
Prosecutors are now pursuing two ringleaders who, they believe, fled the country. They have begun indicting the men in absentia and have moved to confiscate their illegal earnings. If the men are convicted in absentia, Korean officials will then move to have them extradited and seize the remainder of their assets.
A fourth ringleader, known as “Yun,” has been arrested and indicted in Malaysia on charges of conspiring with Lee. Prosecutors said he operated an illegal gambling site on servers in Japan and Thailand, and collected commissions from online gamblers under the guise of “dealer commissions.” Yun netted a reported W80 billion before his arrest.
Three of Yun’s accomplices, authorities say, are still at large in Malaysia and are on wanted lists there.
Prosecutors also announced suspicions that the ring was connected with three Korean crime syn- dicates. They are launching a probe into the possible link between the syndicates and the group.