China Steps Up Efforts To Fight Online Gambling

China is stepping up its efforts to fight online gambling, including creating an online blacklist and enhanced financial transaction scrutiny.

Last week, the Chinese Public Security Ministry held a meeting on countering’ cross-border gambling’ at which Minister Zhao Kezhi called on officials to investigate’ a number of major cases’ of internationally-based online gambling operators serving Chinese customers to’ completely destroy a group of criminal organisations.’

Zhao added that it was “necessary to establish a ‘blacklist’ system for participating in gambling and employees and overseas tourist destinations.” The ministry also sought to “strengthen the ‘fund chain’ and ‘technical chain’ governance measures and resolutely cut off the channels for the circulation of gambling funds.”

Zhao’s call was followed Monday by China UnionPay announcing that some of its partners were failing to “take effective measures to curb illegal elements from engaging in illegal trading activities.” While UnionPay’s announcement also referred to sketchy loan arrangers and other “illegal public merchants,” it reminded its partners that they are prohibited from doing business with online gambling and lottery platforms.

UnionPay advised its partners to “standardise the display of transaction information, accurately reflect the names of real merchants and acquirers,” while warning of’ legal measures’ for illegal use of the UnionPay label.

Chinese officials also make statements of this sort, such as the declared’ Gambling Prohibition Publicity Month’ in January. The campaign has reportedly resulted in 22 significant disturbances to gambling, 13 of which included online gambling sites.

Ironically, due to the coronavirus outbreak, the Ministry may have felt compelled to issue its most recent anti-online statement. In mid-January, the government suspended all lottery operations to prevent people from clustering in retail outlets, imposed extreme travel restrictions on Macau casinos and even detained individuals who had defied instructions not to participate in private mahjong games.

In doing so, the government robbed the residents of their only legally available incentives for gambling. As a result, a recent increase in attempts by local residents to access internationally licenced online gambling services may have been observed by the State. Hedge fund manager Jason Ader recently claimed that during the Lunar New Year holiday period, China’s daily online gambling stats rose 90 percent year-on-year.