Vietnam Crackdowns Illegal Online Gambling Industry And Money Laundering

Vietnam’s Ministry of Public Security (MoPS) announced earlier this week that the authorities had launched a crackdown on the illegal online gambling industry in the country and also targeted money laundering schemes that were taking place in the gambling industry. MoPS decided to release an official report after a number of local publications have been publishing inaccurate reports about the investigations.
MoPS Targets Rikvip iGaming Operator
To set the record straight, the officials finally divulged the status of their operations and revealed that they are currently going after the Rikvip Group, which has been running online gambling websites rikvip.com and rikvip.vn since 2015.
Online gambling is banned in Vietnam and locals are prohibited from setting up or operating online gambling websites. Although foreign bookies licensed off-shore are able to offer their services in Vietnam, the government has blocked many betting and gambling websites to prevent locals from accessing them.
But despite the censures and raids, the Rikvip Group has continued offering paid gambling services to many Vietnamese locals in the last few years. According to the MoPS, the Rikvip websites were offering as many as 42 varied forms of online gambling and renamed its website to Tip.club in August 2016 and made it accessible to Vietnamese locals via mobile and PC platforms.
Rikvip Group Had A Nice Set-up  
To join the games, punters would register and create an account and buy virtual scores called RIK to play. These virtual scores can be purchased via direct deposits to bank accounts; direct purchases from Rikvip agencies; prepaid telecom cards under providers Viettel, Vinaphone, and Mobifone; or using game cards by Vcoin, Zing, Megacard, GoCoin, Gate and Vcard.
If a punter has managed to win enough to collect a certain amount of RIK, he can then convert the RIK to real money by selling the RIK back to the Rikvip agencies, selling the prepaid telecom and game cards or by using various payment channels.
According to the MoPS, payment gateways like HOMEDIRECT, VNPT EPAY and Ngan Luong were used by Rikvip so punters can use the telecom cards to send money. The National Payment Corporation of Vietnam (NAPAS) was also used by gamblers to top up their game accounts.
The MoPS also found that there were 25 tier-1 agencies and some 5,852 tier-2 agencies working as Rikvip representatives.
MoPS called out Viettel, Vinaphone, and Mobifone for encouraging gambling activities in the country by allowing their prepaid cards to be used for illegal online gambling activities which accounted for over 16 percent of the total money funneled into the system. According to their investigations, the three telecom companies earned a combined total of VND1.4 trillion ($62 million) from Rikvip illegal online gambling activities.
Investigations Show Rikvip Group Biggest Illegal iGaming Operator
According to the investigations conducted by the MoPS from April 18, 2015 to August 29, 2017, they found 42 million accounts on the Rikvip/Tip.club system, 14 million users, and over VND9.54 trillion ($420 million) in circulation. This makes Rikvip the biggest online gambling ring in Vietnam.
The scale of operations of Rikvip Group caught the attention of the authorities who carried out a raid last week that led to the arrest of 83 people connected to the Rikvip group. MoPS has now launched legal proceedings against those arrested people, where 41 were charged with organized gambling, 38 were gamblers, four were found to be illegally trading invoices, two were charged for violating money laundering regulations.
Phan Sao Nam, founder of VTC – a multimedia firm and chairman of the online security company CNC, Nguyen Van Duong were arrested and accused of being the masterminds behind the online ring. Along with the two tech businessmen, were the former head of the Ministry of Public Security’s ‘C50’ cybercrime division Major General Nguyen Thanh Hoa and Hoang Thanh Trung, deputy director of the Nam Viet Investment Development Service.
MoPS Looks To Tighten Protocols To Prevent Illegal Online Gambling
Moving forward, the MoPS recommends lawmakers to improve telecommunication regulations and requirements to prevent online rings like Rikvip from taking advantage of these payment channels.
In a statement, the MoPS said, “The loose management of publishing and using telecommunications scratch cards enabled these to become the main payment methods for other services. MoPS recommends the government to add several regulations to patch the holes and overcome shortcomings in the draft Law on Network Security, which is expected to be approved in the upcoming session of the National Assembly.”