Tue, Jan 7, 12:07pm by Ethan Anderson
The chief executive of a Chinese sports betting group has temporarily stepped down amid an investigation into whether the company bribed lawmakers in Japan involved in legalising casino gambling there.
Asia Nikkei reports that Pan Zhengming, the chief executive of 500.com, will vacate his positions, including a seat on the board of directors, until an internal committee finishes a probe into “alleged illegal money transfers and the role played by consultants” in Japan, the company said in a statement to investors.
The board decision was made at Pan’s request, effective December 30, according to the company.
Tokyo prosecutors reported a former head of 500.com’s Japan operations and two former consultants last month.
They are suspected of bribing a membre of Japanese Prime Minister Shinzo Abe’s ruling party to gain a favourable position for a bid to run one of the country’s upcoming casino resorts.
The sports betting group set up a Japanese subsidiary in 2017 with an eye to the proposed casinos, one of which was to be located on the northern island of Hokkaido.
The money linked to the alleged bribe appears to have entered Japan illegally, prosecutors say.
The Japanese lawmaker accused of receiving the money, Tsukasa Akimoto, was also arrested in December.
Akimoto is alleged to have received 3 million yen (US$28,000) in cash from 500.com suspects in 2017, as well as enjoying a family vacation at the company’s expense.
He has denied the charges.
One of the suspects told investigators that five Japanese lawmakers were given cash, sources familiar with the investigation say.
https://t.co/96fQVJWPuu Reports Chair Xudong Chen Has Resigned; CEO Zhengming Pan To Temporarily Step Aside From Positions; Shengwu Wu Named Replacement As Chair, CTO Zhaofu Tian Named Interim CEO $WBAI
— kyookine (@kyookine) January 4, 2020
An internal company memo obtained by the Tokyo District Public Prosecutor’s Office reveals that 3 million yen was handed over to Tsukasa Akimoto.
Another 1 million yen was supplied to each of five other members of the lower house.
The five members in question are Hiroyuki Nakamura, Takeshi Iwaya, Toshimitsu Funahashi, Mikio Shimoji and Masahisa Miyazaki.
The series of funds is said to have been provided to the representatives by former 500.com advisors Masahiko Konno and Katsunori Nakazato between September and October 2017.
It is believed 500.com was angling to be involved in the development of an IR in either Hokkaido or Okinawa.
Ironically, both locations have since withdrawn from Japan’s IR race.
Despite the seriousness of the allegations, Defense Minister Iwaya said, “Nothing was requested for [in exchange for the funds]. There were no benefits awarded. I swear by all that it sacred that I have not been involved in any wrongdoing.”
Funahashi also defended himself against the allegations, stating, “I have not received any funds and I have not provided any benefits.”
Nakamura admitted that he received a donation of 2 million yen from a representative of a tourism company, whose home has now been searched int he investigation, but denies receiving funds from a Chinese company.
The Political Funds Control Law prohibits foreign companies from making donations to political organisations, and the Tokyo District Public Prosecutor’s Special Investigation Division is carefully examining whether the law has been broken.
500.com is an online sports betting company based in Shenzhen.
On December 31, 2019, the company set up a special investigative committee to investigate its former director and three former advisors of its subsidiary, 500.com Japan.
Listed on the New York Stock Exchange, the company may be punished under the US Federal Foreign Corrupt Practices Act, depending on the outcome of the investigation.
The company’s stocks plunged nearly 11 per cent last week.
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