CHINA:POLICE RAIDS on four underground betting dens in the southern Chinese city of Guangzhou last week netted eight suspects and betting slips worth 6.58 million yuan (€610,000), writes Clifford Coonan.
Gambling may be illegal in China, but online soccer gambling is booming - Peking University in Beijing estimates the business is worth €50 billion a year.
In Guangzhou, the China Daily reported, more than 40 police officers raided betting dens in the residential districts of Tianhe, Haizhu, Baiyun and Yuexiu, and all were being used for betting on the Euro 2008 soccer championships in Austria and Switzerland.
"The crackdown has dealt a heavy blow to those involved in online gambling and underground soccer betting events," said one officer. The police estimated that more than 30 million yuan (€2.7 million) was betted during the competition through the online sites.
Establishing how much the illegal online betting market is worth in China is an inexact science. The legitimate internet gambling market worldwide is forecast to surpass €13 billion in 2008, but the illegal market, where the odds are often better and the rewards greater, is said to be enormous. In China, where gambling is generally not permitted, sometimes under pain of execution, gathering data is particularly difficult.
Punters who join gambling rings have to pay a guarantee of up to 100,000 yuan (€9,300), and are then given a log-on to a secret website. Betting takes place online, with updates possible by text message.
A survey by Peking University reckons punters spend 15 times more on illegal online gambling in China every year than they do on the two legal lotteries in the country - the national welfare lottery and the sports lottery - and the amount is equivalent to China's entire annual tourism revenues.
There are more than 300 Chinese-language gambling websites, most based in southeast Asia, and much of the activity is said to work cross-border from Hong Kong and Macao, as well as the Philippines and Singapore.
"In recent years, in China's fight against illegal soccer gambling cases, the number of southeast Asian betting groups involved in such cases are the most," Wang Xuehong, executive director of Peking University's institute for the public welfare lottery, told the Xinhua news agency.
There are reports of millions of euro being transferred out of China via legitimate firms around the country, just minutes before major matches start. The funds flow to major Chinese gambling sites in the US, Europe, the Philippines, Macau, Gibraltar and other areas.
"Last year, one Singapore online betting company's trading volume reached 1.7 trillion yuan, and most gamblers were from mainland China," said Wang.
Wang said he believed illegal gambling sites were preparing to target the Olympics.
"These Olympics will be held in China; Chinese people's enthusiasm to take part is very high. And China itself prohibits gambling, which is precisely why these offshore gambling companies can earn a lot of money," he said.
The International Olympic Committee said it would set up a special unit to check for suspicious betting patterns during the Olympics next month, in an effort to keep illegal gambling and matchfixing out of the games.
China's highest-profile gambler is Ren Jie, who blew almost 10 million yuan (€930,000) and is still heavily in debt.
He said the problem was traditionally rife among ordinary workers, but was spreading among clerical workers and students. Some students lost up to 50,000 yuan (€4,600) on the European Football Championship, most of it borrowed money. This level of gambling debt is equivalent to the annual cost of living for the majority of college students.
Illegal syndicates are popping up all over the country, with pyramid structures of shareholders and agents. Although most of these syndicates bet by phone, they are increasingly going online to gamble.
During Euro 2008, policemen came across sites where bets of 30 million yuan (€2.78 million) and more were allowed.
The interest in gambling on soccer really began in 2002, when the Chinese national soccer team qualified for the World Cup.
China had a disastrous run, and has failed to improve since.
Interest in soccer has suffered badly since the rights to the English Premiership matches was awarded to an obscure Guangdong firm, which means viewership figures have nosedived.
However, people's interest in international soccer was piqued and now millions go online for every competition.
Gamblers complain that there is no outlet for people to have a bit of a flutter - the state-run lotteries are prone to scandals and the odds of winning are slim.
"If the national welfare lottery and the sports lottery were fair and transparent, who would participate in soccer gambling?" one individual from Henan commented online.
Some have suggested that, while gambling is illegal and a mug's game, it beats investing on the stock market, which has plummeted this year.
As one online commentator from Hunan province said: "The yield from soccer gambling is certainly better than buying 'A' shares on the stock market."