How a gambling ring protected by top cops was busted

By Staff reporters   December 20, 2018 | 08:00 am GMT+7
How a gambling ring protected by top cops was busted
Phan Van Vinh, former director of the General Police Department under the Ministry of Public Security, is in court in Phu Tho Province in northern Vietnam on November 30. Photo by VnExpress/Giang Huy

It took courage to bust a $420mln online gambling ring protected for over two years by top Vietnamese cops.

On August 30, 2017, Le Xuan Loc, a senior official with the prosecution office of Phu Tho Province, two hours northwest of Hanoi, was assigned to join a team to examine the headquarters of the Hi-Tech Security Development and Investment Co., Ltd, or CNC, in Hanoi.

"Do you know what company we are?" CNC’s CEO Luu Thi Hong asked Loc and the team.

She then called the company’s chairman, Nguyen Van Duong, who showed up not a bit scared, but confident.

"Nice. Very nice. Provincial policemen dare to come here to examine a company of the ministry," Duong said. His company was then an official security partner of the Ministry of Public Security.

He then called Nguyen Thanh Hoa, chief of the ministry’s cyber-crime unit, on the phone. But Hoa could not save the firm from the inspection, Duong was arrested late that night.

That inspection of CNC was a result of another investigation of a fraud case involving mobile top-up cards that Phu Tho police had been pursuing since May last year.

The scammer in that card case claimed he had redeemed all the cards for virtual currencies used in an online gambling card game. To check his claim, investigators spent 105 days tracking down the ring before finding out that it was run using two online game portals that resembled professional casinos in which players could gamble virtual money and convert their winnings to real money.

That probe was what led them to CNC.

When Loc and others continued the search throughout the night, they found documents leading to Hoa and Phan Van Vinh, who had retired as director of the General Police Department under the Ministry of Public Security in April last year.

Nguyen Thanh Hoa,former director of the ministrys Department for High-Tech Crime Prevention. Photo by VnExpress/Giang Huy

Nguyen Thanh Hoa, former director of the Department for High-Tech Crime Prevention at the Ministry of Public Security. Photo by VnExpress/Giang Huy

In 2011, Hoa of the cyber-crime unit signed an agreement to set up CNC as an economic unit to support its activities in fighting high-tech crime. The agreement was approved by Vinh.

Loc and the investigation team were well aware who they had to confront when approaching CNC, but they were determined to press ahead.

When they collected enough evidence to launch criminal proceedings against Duong, seven days since he was arrested, the team felt like they had removed a big burden from their shoulders, he recalled.

Under the name of an economic unit of the public security ministry, Duong had repeatedly asked for permission from Hoa and Vinh to pilot a gambling network. But long before he’d got the green light, he had already worked to set up the gambling service in May 2015 with Phan Sao Nam, founder and former board chairman of major online communications firm VTC.

According to investigators, the gambling ring headed by Nam and Duong on web portals Rikvip/Tip.club had established a large network of 25 "tier 1 agencies" and nearly 5,900 "tier 2 agencies" with nearly 43 million user accounts.

The illegal ring was found to have generated a total income of over VND9.8 trillion ($426 million) and a profit of VND4.7 trillion. Out of this profit, Nam received nearly VND1.5 trillion, Duong got over VND1.6 trillion while a group of other suspects earned VND1.57 trillion.

Vinh had not only turned a blind eye to the formation ofthe ring, but also signed documents to facilitate its formation.

Arrest of top cops

In January 2018, the police summoned Vinh and Hoa. Six investigators of Phu Tho were assigned to work with the top cops.

Loc said the police had trouble with Hoa as he kept saying he was sick. He actually stayed at a hospital in Hanoi.

"We traveled from Phu Tho to Hanoi several times but he did not cooperate," Loc said. "One time I came to the hospital and he said he had a headache, but just after we left the hospital, we saw him driving a motorbike out of there."

On March 11, Phu Tho prosecutors granted the police the arrest warrant. They came to the hospital and took Hoa away after doctors said he was fine.

Vinh was more cooperative. He was arrested when meeting with the police on April 6, 220 days after Duong's arrest. He had asked not to be taken at home.

At a court in Phu Tho in November, Vinh was sentenced to nine years in jail while Hoa got 10 years for "abusing power or position in the performance of official duties."

They were also fined VND100 million ($4,300) each.

For organizing gambling and money laundering, Duong got 10 years in jail while Nam got five years.

 
 
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