Chinesemedia targets Suncity Group for possible offshore gamblingSuncitycounters claims and threatens legal actionAnalystsstill cautious about what the ramifications can be
Suncity Group has responded to Chinese media accusations that the company has been running offshore online gambling. The junket operator has threatened legal action.
ChineseNewspaper Accuses Suncity of Running Offshore Gambling
Caughtin controversy, Suncity Group,one of the largest Asian VIP casino operators, has denied allegationsthat the company has been supporting online gambling businesses orhas been involved in runn 7BALL ing such subsidiaries.
SuncityGroup is responding to accusations that circulated in Chinese Mediaon Monday, July 8. Based on those report Suncity has used proxies toallow offshore online casinos gain access to Chinese customers.
Thenews comes directly from EconomicInformation Daily,which is under the control of the national news agency Xinhua.According to EID, Suncity Group canvassed junket room patrons inMacau and offered to sign them at online casinos located offshore.This allowed Suncity to allegedly move capital out of the country.
SuncityResponds to the Accusations
Falling out of grace with the state is a proven formula for wrecking business. Even China’s largest tech company Tencent, which also provides solutions to online casinos and card rooms, has been forced to shut down or stop developing a number of its products.
In light of the inexorable stance of the state against flaunting the law, Suncity has issued a Statement of Clarification which addressed the issue head on. Sun City stated that under the Junket Promoter License that has been obtained under Macau’s law, the company had “no possession of any casino and gaming tables, neither does it operate any online gaming business”.
Suncityalso pointed out that the key areas of interest for the groupremained the VIP gaming services along with the hotel and integratedresorts. The company called the information circulated by EIDwrongful, butting heads with the state media.
Morespecifically, Suncity Group has argued that the “informationcould contain subjective speculation and therefore has led toreputational damages to the Company and its shareholders”.
WhatDo Observers Say?
Globalasset management firm StanfordC Bernsteincommented earlier this week that this had been the first time that aChinese national media had accused a junket operator from running anoffshore gambling business.
Thefirm said that it was too early to see any consequences from what hadhappened, but analysts also expressed the cautious opinion that Chinamay be warning junket operators to watch out about any offshoreoperations they might be running, which in turn means that companiesmay soon see the government intervene more.
SuncityGroup’s portfolio has multiple investments on its portfolio includingthe VietnamIR Hoiana(34%) and Summit Ascent Holdings which in turn owns the famousRussian casino property, Tigrede Cristal.
Respondingto the accusations leverage by EID, Suncity noted that it wouldn’thesitate to seek legal action to protect its reputation.
