News Credit Card Gambling Raid for China Fintech Firm

Credit Card Gambling Raid for China Fintech Firm

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Chinese police have raided a top fintech firm in an anti-credit card gambling operation.  

Media in China reported on Monday that 100 officers took part in an anti-gambling raid on the office of 51 Credit Card Inc. The firm, which is listed in Hong Kong, is one of the biggest credit card bill services in China, and claims more than 83 million users.

China is determined to combat underground banking, through which Chinese residents avoid strict capital control laws. Above all, gambling and sending money abroad are the main drivers of attempts to evade the rules.  

In March this year, the Chinese Centre Bank warned finance firms to improve their checks to make sure that they were not missing illegal payments.

But in this case, it seems there were several causes for the raid. One report said that the firm was suspected of misuse of customer data, however the most likely cause seems to be a link with credit card gambling. One media outlet reported that 51 Credit Card Inc had processed payments for gambling firms.

China outlaws all forms of gambling except the state lotteries. In recent months, the government has been vocal in its anti-gambling stance. In August, they praised Cambodia’s government for promising to close down gambling in that country. It has also urged other countries to follow suit and as a consequence, has been working with other nations to target betting firms that target China.

But the raid was bad news for investors. 51 Credit Card had shown a big rise in profits this year after its stock market debut in 2018, but its share price has dropped by a third since Monday.

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