Macau Gambling Firm Suncity's Shares Plunge After CEO's Arrest

Shares of Macau gambling group Suncity Group Holdings Ltd. slumped 40% in resumed trade on Tuesday after its CEO was arrested over alleged links to cross-border gambling. The company said he intends to resign, Eduardo Baptista and Donny Kwok reported for Reuters.

Photo Insert: Casino buildings at the Macau Peninsula

Alvin Chau, also the founder of Macau's biggest junket operator which brings in high rollers to play at casinos, was arrested by Macau police on Sunday and is the subject of an arrest warrant in mainland China - where all forms of gambling are illegal.

Macau authorities arrested Chau and 10 others, accusing them of using the world's largest gambling hub as a base for an illegal "live web betting platform" in the Philippines that attracted mainland Chinese.

Authorities in the eastern Chinese city of Wenzhou have separately accused Chau of forming a junket agent network that helps citizens engage in offshore and cross-border gambling activities as well as setting up an asset management company that helps gamblers make cross-border fund transfers.

Cross-border flows of money due to gambling have long irked the Chinese government and Macau authorities said their investigation has been in train for two years.

That coincides roughly with the time that Suncity came under attack in China's state media which criticized online gaming activities for causing what it described as great harm to China's social-economic order.

Suncity said at the time it did not operate any online gaming. Miao Shengming, an official with China's top prosecutorial agency, said on Monday that some overseas casinos and online gambling websites primarily target mainland clients, harming China's "economic security."

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