Details are continuing to emerge in the case of Wei Seng “Paul” Phua, the ultra high-stakes gambler and important component of the celebrated Macau nose-bleed games which have attracted the poker world’s wealthiest players in recent years.
Arrested along with Paul Phua were his son, Wai Kit “Darren” Phua, and six other associates or employees — Seng Chen Yong, Wai Kin Yong, Hui Tang, Yan Zhang, Yung Keung Fan and Chun Sang “Herman” Yeung.
Phua and his seven alleged associates were arrested on Sunday in Las Vegas on gambling and bookmaking charges, two weeks after authorities were alerted by Caesars Palace officials to highly unusual activity connected to the group. The eight people, collectively enjoying Phua’s reputation as one of the world’s most desirable casino patrons, or “whales,” had obtained three of the Las Vegas casino’s private villas reserved for the casino’s most valued guests. The group then demanded that Caesars provide them an unusual amount of high-end computer and telecommunications equipment and services for the villas.
Illegal Gambling Operation, Organized-Crime Links Alleged
According the formal complaint filed by federal authorities on Monday, a copy of which has been obtained by 4Flush, the group then began actively conducting a bookmaking operation utilizing multiple Asian sportsbetting websites, focusing primarily on recent FIFA World Cup action. Both the complaint and a press release issued by United States Attorney’s Office for the District of Nevada allege that Phua, 50, from Malaysia, “is known by law enforcement to be a high ranking member of the 14K Triad, an Asian organized crime group.” The 14K Triad group, according to various sources, specializes in gambling and money-laundering activities.
The complaint alleges that Phua and his group conducted millions of dollars of online gambling transactions from the villas on Caesars Palace property before being evicted and later arrested. Named in the complaint as sites that were being used in the operation were major Asian-market gambling sites SBOBET and IBCBET, along with a third gateway site mentioned only by its URL, “W106.hg088.com”.
None of the three sites are licensed within the state of Nevada by the Nevada Gaming Commission, making their use for real-money sportsbetting activity conducted within the state illegal under Nevada statute.
Phua Allegedly Deported from Macau in June
The complaint details the series of events that led up to the group’s arrest. Paul Phua and 21 others were arrested on June 18th in Macau, within one hour of checking into one of the Asian resort destination’s major casinos, on similar charges of attempting to set up an illegal gambling syndicate attempting to conduct significant action on ongoing World Cup games.
Phua was released 48 hours later. This Malaysian report states that he was deported from Macau, which makes his participation in the future nose-bleed poker games there (including at Wynn Macau) in which he was a primary participant an unlikely future occurrence.
Though the federal complaint filed on Monday doesn’t detail Phua’s Macau activities, it appears Phua attempted to relocate his alleged World Cup betting operation after Macau declared him unwelcome. It is possible the illegal sportsbetting may already have been ongoing, if the federal complaint is borne out in court, since the group had been occupying the three Caesars Palace villas since early June. However, the likeliest interpretation based on the information available at this time is that Phua allegedly shifted his operations to Las Vegas on or around June 22nd after the events in Macau.
According to the complaint, Phua’s associate Seng Chen Yong checked into and occupied Villa #8881 on June 6th, occupying it until the events of last weekend. On June 7th, another of Phua’s associates, Hui Tang, checked into and began occupying Villa #8888, while Phua himself arrived in Las Vegas via his private $48 million Gulfstream jet, checking into and occupying Villa #8882.
The requests to Caesars Palace staff to provide the unusual computer and equipment and internet service began after the three villas were occupied by the group, according to the complaint.
Phua flew to Macau on June 18th or 19th, where he and the 21 others were arrested, then returned to Las Vegas on June 23rd following his deportation. During questioning by federal agents but before his actual arrest, Phua was reminded by them that he had also flown to and from London briefly, from July 1-3, 2014. During questioning, Phua claimed he had “forgot” about the brief London trip, though the prompting by the questioning agents may also have been a tacit acknowledgment that Phua’s activities and travels were already being tracked by US authorities, independent of the actual illegal gambling allegations.
Computer Equipment, Erratic Behavior the Tipoffs
It was the requests for computer equipment, cable and dedicated DSL (internet) access that eventually drew the casino’s and investigators’ interest. At least two casino electrical engineers were called to the villas to help install the equipment on or around June 22nd, which correlates closely with the shutdown of the alleged Macau operation and Paul Phua’s own return to Las Vegas.
Both of those engineers reported the activities to casino supervisors, claiming to have seen multiple computer screens with Chinese-language characters but with rows of numbers and general appearances highly similar to computer screens used in the sportsbetting operations already offered by Caesars’ own legal bookmaking operations.
Also drawing attention was the refusal by the villa’s occupants to allow casino staff normal access to the rooms, excepting only requests for emergency technical service, as happened once before one of the World Cup semifinal games. By July, FBI investigators began posing as service technicians and accompanying actual Caesars staff on demanded technical-service trips to the villas. According to the complaint, here’s what happened on July 4th:
On July 4, 2014, one of PHUA’s associates requested Caesars Hotel and Casino to deliver a laptop computer to Villa 8882. [Caesars engineer] agreed to accompany [Special Agent] Lopez, who was posing as a support technician employed by [Caesars], to Villa 8882. When they arrived, an Asian male butler, who is employed by Caesars Hotel and Casino and assigned to assist the occupants in Villa 8882, restricted their access to only the butler’s pantry area. The butler blocked their path to other parts of the villa, and the butler was adamant that they were not allowed into other parts of the villa. The butler stated that the guests were in the media room, but they did not want anyone to see their “business.” The butler’s actions were so intimidating that [Caesars engineer] later stated that he was fearful for his safety. While in the butler’s pantry in Villa 8882, [Caesars engineer] and SA Lopez set up a brand new Windows 8 laptop for use by Villa 8882’s occupants, pursuant to the occupants’ request. The butler instructed [Caesars engineer] and SA Lopez to leave the newly operational laptop in the pantry, and then escorted them off the premises.
Sportsbetting Links and Ledgers Recovered
Such activities were bound to draw more attention, particularly since they’d been occurring for two weeks or more. When the search warrants were executed in the three villas, authorities verified the immensity of the online operation, which included, just in Villa 8888 alone, five workstations set up and operational with three monitors attached to each workstation.
The screens were active and being used even when the agents entered the villas. The only female among the eight people arrested, Yan Zhang, could barely be bothered to drop her work when agents raided the villas. According to the complaint, “When agents instructed her to raise her hands when they entered Villa 8888, she raised one hand while continuing to type with her other hand.”
All eight occupants of the villas were questioned and cooperated with agents to varying degrees, while the computer equipment itself was examined, showing the active links to the sportsbetting sites, the extensive gambling ledgers and records, as well as hundreds of e-mails detailing the betting activity. Technical shorthand for identifying wagers was commonplace, and the exact amount of wagering conducted has yet to be determined, though press information released by the USAO suggests that the ring conducted hundreds of millions of dollars’ worth of illegal sports bets.
One of the sites linked to the operation, SBOBET, immediately issued a disclaimer that their company was involved in the illicit operation. IBCBET, however, appears to be owned in whole or in part by Paul Phua himself. One related line in the complaint comes from Paul Phua’s son, Darren, who admitted during questioning that father Paul owned “the IBC website for sports bets.” Alleged illegal sites like these are normally on “blacklists” at sites like SBR or casinosformoney.com.
One explanation for the extensive linkage is that Phua’s group was laying off excessive action on certain teams via the SBOBET site, whether or not SBOBET’s own operators new of the nature of the alleged illegal operation. Among the extensive information recovered was documentation indicating that VPN software and programs such as TeamViewer had been installed on many of the machines, and that they group may have been remotely operating the IBCBET website via the DSL hookups. The IBCBET sports betting site is believed to normally be operated out of the Philippines.
Each of the eight people arrested faces two counts at the present time, of transmission of wagering information and operating an illegal gambling business. Phua and his son Darren were released Monday on $2.5 million bail, with the elder Phua’s $48 million GulfStream jet also held as collateral against a possible flight risk. Others among the defendants were also cited as possible flight risks and remain in detention awaiting further bail hearings.
Paul Phua immediately retained high-profile Las Vegas attorney David Chesnoff for his defense. Chesnoff has defended numerous famous poker players and celebrities in various legal scrapes, and immediately issued a statement protesting Phua’s innocence and decrying the USAO’s claims that Phua is a member of the Asian organized-crime 14K Triad game.
An additional development found Chesnoff leading with news that high-stakes pro Andrew Robl was among those helping provide bail money for Phua. Via Chesnoff, Robl offered the court a notarized promise of $1.5 million to assist in the granting of bail. Robl is a frequent participant in the Macau games featuring Phua whose future is now in doubt, as is Phua’s future participation in major poker philanthropic events, such as the 2012 Big One for One Drop event, where he was among the million-dollar-entry participants.
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