- Money laundered through frequent online transfers to 25 bank accounts in bid to avoid detection
- Syndicate offered cash payments to recruit city residents to set up accounts with virtual banks to hide cash
Hong Kong police broke up a criminal gang that collected HK$40 million (US$5 million) in illegal bets from its gambling website in just four months, the force revealed on Thursday.
Seven people – two core members of the syndicate and five others who laundered the dirty money through 25 bank accounts – were arrested on Wednesday.
Senior Inspector Lo Chun-hei, of the financial intelligence and investigation bureau, said the racketeers set up an overseas gambling website and found customers through social media.
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“The syndicate then offered a monetary reward to lure local residents into setting up accounts with virtual banks,” he said, adding that they were paid between HK$500 and HK$2,000 each.
Police arrest 283 in Hong Kong tied to syndicates that laundered HK$1.8 billion
He said the core members used the accounts to collect illegal bets and launder the money through frequent online transfers in an effort to “cover up the flow of the funds and avoid police detection”.
“The investigation showed the syndicate used 25 bank accounts to handle HK$40 million in suspected crime proceeds between April and July,” Lo said.
Police picked up the seven residents in a series of raids across the city on Wednesday after analysis of intelligence reports and a major investigation.
Officers seized mobile phones, bank cards, computers and documents during the operation.
Police seized a small amount of crystal meth at the home of one of the core members.
Police arrest 283 in Hong Kong tied to syndicates that laundered HK$1.8 billion
The suspects, aged between 19 and 56, were detained for conspiracy to launder illegal proceeds and possession of illegal drugs.
They included a cleaning worker, a delivery man and unemployed people.
Police on Thursday said they were still detained for questioning.
Lo said police were trying to track down the flow of the money and final destinations for the cash, adding that the investigation continued and further arrests were possible.
He added officers were also investigating what types of gambling were offered on the website.
Illegal bookmaking is punishable by up to seven years in jail and a HK$5 million fine in Hong Kong.
Placing bets with an illegal bookmaker carries a maximum penalty of nine months in prison and a HK$50,000 fine.
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This article originally appeared on the South China Morning Post (www.scmp.com), the leading news media reporting on China and Asia.
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