The Chinese online sports lottery firm, 500.com, has concluded its probe into bribery allegations and asserts its innocence. They engaged a legal firm to examine the matter, and the firm determined that 500.com did not violate any laws in its pursuit of a Japanese casino permit. This follows the arrest of three consultants associated with 500.com in Japan last year for purportedly bribing Japanese government officials to gain an edge in the casino bidding process. This incident resulted in the departure of 500.com’s chairman and CEO earlier this year. 500.com states that they have revised their compliance procedures and internal controls based on the investigation. This news arrives just a week after an accounting firm severed its connection with 500.com.
The group thinks that these questionable payments might reveal significant flaws in the company’s internal regulations.
Friedman also voiced worries about the reliability of the company’s audited financial records for the periods ending December 31, 2017, and 2018, stating that he was uninformed of the supposed unlawful purpose of certain payments.
Following Friedman’s departure, 500.com hired Marubeni & Co. to offer assistance and counsel to the company regarding the alleged illicit payments.
Marubeni will examine the supplier’s combined financial statements and internal controls as of December 31, 2019. It will also re-examine the supplier’s consolidated financial statements and evaluate the effectiveness of its financial reporting controls for the fiscal years 2017 and 2018.
In late 2019, Japanese media outlets reported that a local subsidiary of 500.com, established in 2017, was thought to have given bribes to Japanese legislator Tsukasa Akimoto with about $30,000 in connection with a proposed casino in northern Hokkaido.
500.com recently stated that it is not involved in any legal proceedings in Japan, even though two former advisors, Masahiko Konno and Katsuyuki Nakazato, will be sentenced next week in Tokyo District Court after admitting guilt to bribery charges. Prosecutors are seeking a two-year prison sentence for Konno and a 22-month sentence for Nakazato.
Masuaki Akimoto is facing accusations for numerous bribery claims and infractions of Japan’s organized crime legislation. He attempted to influence witnesses, including Nakazato.
A law enacted in 2018 permits the development of three gambling resorts in Japan, with subsequent ventures only being authorized seven years after the initial casino resorts open. Okinawa, Osaka, Yokohama, Wakayama, Sasebo, and Tokyo are all contemplating becoming locations for gambling resorts.
Despite a 51.1% year-over-year decrease in earnings in the initial six months of the year, 500.com reported last month that it was still able to lessen its overall losses for the period.
Total income for the six months concluding June 30 was RMB 99.1 million (£11.3 million/€12.4 million/$14.5 million), less than half of the previous year’s initial six months. However, 500.com’s overall loss was RMB 121.4 million, less than half of the RMB 233.7 million in 2019.
500.com also declared last month that it would resume operations in Sweden through its The Multi Group (TMG), after the company renewed its online gambling license in the nation for a period of two years.
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