Huge illegal gambling operations continue to operate in South Korea, but their days are numbered, as recent police operations have demonstrated, with a new major bust targeting a gambling enterprise that saw $230 million (KRW 320 billion) wagered and exploited people with hearing impairment and used them as “mules” to facilitate gambling transactions in an attempt to obfuscate the ringleaders’ traces.
Vulnerable People Targeted in Illegal Gambling Scheme
Police opened an investigation into a fairly low-key illegal gambling website, which quickly turned out to be ground zero for a massive gambling operation, including the use of aforementioned “mules” to process payments worth millions ($3.8 million) of dollars in the space of months.
The group did not operate the websites specifically, but rather recruited people to place bets and use their bank accounts to go unnoticed.
The Busan Metropolitan Police Agency was quick to identify that people who were receiving payments through their bank accounts from the website were in fact people with hearing impairments, which immediately signaled foul play to the police officers.
They immediately identified a key person in the scheme, a 40-something interpreter for people with hearing impairments, who had misled victims to believe that processing gambling payments through their accounts would improve their credit score. The interpreter was also paid about $1,100 per account to maintain the ruse and keep recruiting people.
The scheme operated on familiar terms. Financially vulnerable people would be offered payment to release their accounts to third-parties, or in this case the group behind the gambling website, and as it turned out – other websites as well. Overall, there were 90 bank accounts secured this way.
$230M Wagered Through Accounts as Part of Group’s Operations
But the larger group was not limited to the website that police initially detected, and that led them to the rest. In fact, the group was using various bank accounts to engage in “hedge” betting, a practice where the criminals were betting against different outcomes on the same event, allowing a slight difference in odds to ensure a profit in the end.
The precise term used in South Korean outlets is “two-way gambling,” which further implies that, besides seeking for the best odds, the culprits were also abusing other promotional perks and offers.
By using many different recruited accounts, they were also staying undetected by gambling websites.
Overall, following the initial investigation, police were able to arrest 172 people linked to the scam, but also gamblers and the people behind the gambling websites targeted, and establish the total sum processed through the accounts – $230 million. Six of the suspects – which include the interpreter – were referred to prosecutors and are in custody.