Chinese Gambling Networks Utilize E-Commerce Cards as Casino Chips in Illegal Online Casinos

(AsiaGameHub) –   Police report that Chinese online gambling operations are enabling illegal bettors to use prepaid e-commerce cards, gift vouchers, and gaming credits as a substitute for casino chips.

Authorities explain that gamblers utilize these cards to add funds to their accounts on gambling platforms. The syndicates then convert these vouchers into cash through the use of professional money mules and third-party verification services, according to the Chinese media outlet E23.

Furthermore, law enforcement officials in Sichuan Province indicate that these syndicates are assembling a network of small-scale online retailers and technology experts to manage their operations.

Chinese E-Commerce Cards Function as Casino Chips: An Explanation

Journalists from the Chinese media outlet CNR spoke with an online retailer who used the alias Zeng Lin.

Zeng Lin stated that she established her business in 2023 but initially experienced limited success selling e-commerce store vouchers.

“One day, someone contacted me online,” Zeng Lin recounted. “They offered to provide me with a consistent supply of cards, assuring me that sales would be guaranteed as long as we sold their cards.”

Zeng Lin accepted the offer.

“Sales remained slow at first,” she said. “I was only managing to sell vouchers worth a few thousand yuan daily.”

One thousand yuan is equivalent to just under $150.

However, the store owner reported that approximately two weeks later, “sales suddenly surged,” generating daily revenues of 600,000 yuan (over $88,000).

A subsequent police investigation revealed that Zeng Lin’s store had generated over 20 million yuan (approximately $3 million) in a single month.

She later informed detectives that she began to suspect something was seriously wrong.

“With such substantial daily sales, I started to suspect that the cards were exclusively being used for gambling,” the store owner admitted.

Zeng Lin told the police that her supplier offered her cards and vouchers at a 9.85% discount. As sales increased, this discount rose to 9.9%, she stated.

“When you deposit funds onto casino platforms, the operators recommend specific stores where you can purchase [vouchers and gift cards],” a gambling suspect informed the police. “Zeng Lin’s store had the best reputation and a high sales rate, so I would choose her store.”

Redemption Platforms and Money Mules Facilitate the Scheme

Police report an increase in what are known as “redemption platforms,” which cater to gambling rings.

These platforms ostensibly allow customers to purchase virtual goods from legitimate online retailers.

However, by routing payments through what police described as “layers of complex back-end systems,” these platforms also enable customers to exchange e-commerce credit for cash.

This is where money mules become involved, according to detectives. The mules lend their bank accounts to casino operators, who then use these accounts to launder funds before eventually transferring the money to their own accounts.

Casino operators can also utilize this same system to disburse winnings, police noted.

“If an online gambling platform receives a significant volume of cards and needs to convert them to cash within a short timeframe, it can only do so through a redemption platform,” explained an officer from the financial investigations team at the Neijiang Public Security Bureau in Sichuan Province.

Several police officers have commented that current e-commerce regulations are “practically ineffective” against this type of criminal activity.

“Regulations only mandate that card-issuing companies are responsible for monitoring card purchasers,” an officer stated. “However, they do not require any oversight of what happens to these cards and vouchers after they have been sold.”

Police Intensify Efforts to Locate Illegal Gambling Operations

Earlier this month, several individuals suspected of being Chinese gamblers sustained injuries while attempting to evade a police raid in Pattaya, Thailand.

Officers reported that three men jumped from a second-floor window onto a hard-tiled surface. Police characterized the illegal establishment as a “VIP gambling club.”

Authorities also report that operators of illegal gambling dens are increasingly establishing themselves in abandoned buildings within Mainland China.

Many of these operations employ CCTV networks and paid lookouts to detect the presence of law enforcement, detectives added.