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A Taiwanese court has convicted the first tranche of 52 employees from a leading Chinese online gambling group for organising illegal gambling activity for profit, although all avoided jail time after confessing to the charges.
The District Court in Taichung, Taiwan’s second-largest city, sentenced the 52 defendants to lesser sentences of between two and six months in prison in a judgment dated March 29.
However, Taiwanese law allows custodial sentences of six months or less to be converted to fines.
The defendants were lower-tier employees of the Wanbo Group, one of the largest online gambling syndicates in Asia, and targeted gamblers in China, Taiwan and the Philippines, according to the judgment.
Convictions of more senior suspects linked to the group have yet to be announced, with a husband-and-wife team who are believed to have been running Wanbo’s Taiwan operation denying they had overall control.
The judgment said the real names and ages of the two have yet to be determined, but it has been confirmed they came from China to the central Taiwanese city of Taichung to supervise the offices before they were raided in August 2022.
The court said the wider enterprise was dominantly a money laundering operation that concealed and transferred criminal proceeds, and that the husband and wife, nicknamed “James” and “Coco”, were “responsible for initiating, hosting and controlling gambling in Taiwan”.
The group allegedly ran seven gambling websites covering casino games, sports betting, esports and other games, with staff on site soliciting customers in Taiwan, China and the Philippines.
Gamblers could choose between cryptocurrency, Chinese credit cards, Alipay and other payments channels to place bets and redeem winnings.
Another nine suspects with more senior roles are named in the judgment, and are likely to be included in any future ruling against “James” and “Coco”.
A legal source familiar with the case said that Wanbo, one of the top three online gambling syndicates with Taiwan connections by gaming volume, had changed its corporate structure after initial investigations into the company prior to the 2022 raid.
The changes included firing all employees, then rehiring them as consultants and paying their salaries using cryptocurrency channels, the source said.
The intent was to reduce risk of prosecution, the source said, although the group’s ongoing B2C exploits under the guise of a registered B2B company ended up sinking the operation.
The judgment identified the cryptocurrency used to pay staff salaries as the US-based Tether stablecoin.
The court said it took into account the defendants’ “motivations, purposes, conduct, period of involvement with the gambling group, seniority, work requirements, salary, and other factors such as intellectual capacity, and economic and family circumstances” in handing down the transferable jail terms and fines.
Taiwan had enjoyed a reputation for hosting online gambling backend services for some years, complementing B2B and B2C operations in the Philippines, but a series of prosecutions of B2C offenders has significantly narrowed the grey area in which operators function.
