Boyaa Interactive, the company behind several mobile poker apps, has announced that almost $90 million in funds have been frozen by the Chinese authorities in their crackdown on illegal gambling.
Chinese court seizes bank accounts of online card game developer Boyaa https://t.co/yo49Uisc39
— Topgoal Media TV (@Topgoal) September 2, 2019
The Chinese Crackdown on Poker
The Hong Kong-based tech developers revealed the staggering figures in an Inside Information Announcement to shareholders via the Hong Kong stock exchange.
According to the statement:
“Reserves were frozen due to a prosecution made by the relevant PRC judicial authority against its individual current or former employees for their alleged illegal activities conducted through one of the Company’s onshore online gaming platforms.”
The news comes almost exactly one year after China’s Higher People’s Court confirmed Boyaa Interactive International Limited Chairman and CEO, Zhang Wei’s one-year jail sentence.
Zhang had appealed against his sentence, which included 18 months suspended – as well as a RMB2,500,000 (roughly $350,000) fine for the company – after the court convicted him on bribery charges.
Boyaa is the company behind the poker app Texas Hold’em Poker, one of dozens of mobile poker-rooms available to poker players. They are especially popular in heavily-regulated countries.
Boyaa and Other Chinese Poker Apps
Essentially operating as social, play-money cardrooms, the apps are hugely popular as a means of bypassing laws such as those the Chinese government passed in June of last year.
In reality, people use these apps as proxies for real-money play. Agents are recruiting and organizing the private online games, as well as controlling the funds.
The ‘tokens’ bought by players for use in the games are basically ‘markers’ for cold, hard currency, the middlemen agents taking a cut for their services.
Boyaa’s share price fell quickly after last year’s seizure. This week’s news is a further blow, although the company itself is not under legal scrutiny.
They also state “all other bank accounts of the company … remain in normal operations and the case will not affect them”, despite the possibility of the $88.6 million in frozen funds being partly or wholly forfeited.
The rise of social poker apps has been a massive factor in the Asian poker explosion over recent years, estimates at up to $10million per day passing through the underground mobile cardrooms.
The Chinese government’s attacks on the industry, however, have seriously undermined it – Boyaa’s Texas Hold’em Series revenue, for example, declining by over 30% in just one year.
It looks likely that the polarised battle between the Chinese authorities and those wanting to offer and play poker will be running for the foreseeable future.
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