550 Billion Won Earned from Illegal Gambling Sites... Sweeping Shopping Spree for Buildings and Companies

A group that laundered approximately 50 billion KRW in profits from operating illegal gambling sites and spent it on purchasing supercars, high-end artworks, real estate investments, and corporate acquisitions to enjoy a luxurious lifestyle has been apprehended by the prosecution.

The Busan District Prosecutors' Office Violent Crime Investigation Division announced on the 22nd that four members of the group, including Mr. A (42), were arrested and indicted on charges of violating the Act on the Regulation of Concealment of Criminal Proceeds, the Real Name Real Estate Act, and the Real Name Financial Transactions Act, while five accomplices were indicted without detention.

A bundle of 50,000 won bills hidden at the residence of fund manager Mr. A [Image source=Busan District Prosecutors' Office]

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Among the group, Mr. A is reported to be the head of domestic money laundering. Meanwhile, Mr. B (35), the head of the gambling site operations, fled to the Philippines and is currently being pursued under an Interpol red notice.

Since around February 2017, Mr. A, Mr. B, and their associates have been operating 16 illegal gambling sites domestically with servers and offices located in the Philippines. It is known that their daily operating revenue from these gambling sites reached up to 600 million KRW. The proceeds were withdrawn domestically through 100 dummy bank accounts and laundered.

Supercar purchased with criminal proceeds by Mr. A and others [Photo by Busan District Prosecutors' Office]

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The methods of money laundering were diverse. They imported and resold 24 supercars such as Ferrari and Lamborghini, acquired a tire company and laundered money by purchasing tires, among other tactics.

Additionally, they pretended to acquire shares in real estate corporations and then resold them for profit, purchased ships, and consecutively bought and sold luxury apartments in Haeundae, Busan, priced at 900 million KRW and 1.8 billion KRW, ultimately purchasing an apartment worth 2.7 billion KRW. It was revealed that they mainly used family members, employees, and employees’ family names to hold the large sums of laundered money, assets, and corporations, enabling them to live an ultra-luxurious lifestyle.

The group also laundered criminal proceeds through high-priced artworks.
[Image source=Busan District Prosecutors' Office]

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In particular, Mr. A created shell companies to hold real estate under borrowed names and posed as a successful businessman by purchasing land in Sinsa-dong, Gangnam, Seoul for 16.4 billion KRW and constructing a building. To support this, he also purchased a supercar 'Bugatti Chiron' worth about 4 billion KRW and luxury watches 'Richard Mille' valued between 300 million and 600 million KRW.

He also acquired artworks by Picasso, Nam June Paik, Andy Warhol, Roy Lichtenstein, Takashi Murakami, and Lee Ufan from famous galleries, and purchased luxury brand bags from Hermes, Chanel, and others. Meanwhile, Mr. B’s family reportedly purchased a 1.7 billion KRW apartment in Haeundae with laundered criminal proceeds and have been residing there.

The prosecution seized supercars and high-value artworks from Mr. A’s residence and achieved the confiscation and preservation of real estate and financial assets worth approximately 53.5 billion KRW, accounting for 97% of the 50 billion KRW criminal proceeds laundered by Mr. A and his associates.

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