Police in South Korea have dismantled an illegal gambling operation that targeted minors in gaming cafes. Officers estimate the operation generated over $15 million in illicit wagers. 

The Jeju Provincial Police Agency said Monday it arrested 21 people, including a man in his 40s identified as the ringleader. The network operated gambling dens by converting adult PC gaming cafes and villas near schools in Jeju.

Korea JoonAng Daily reported that the gambling sites handled about 22.6 billion won ($15 million) in bets. At the time of the arrests, police seized 250 million won ($170,000). 

Group Loaned Money To Teens At 650% Interest

In addition to running the gambling sites, the group also lent money to high school students at interest rates of up to 650 percent. 

Five teenagers were caught, including one student who borrowed 11 million won ($7,672) to gamble. The three gambling sites they operated generated about 9.2 billion won ($6.4 million) in wagers.

Operating an illegal gambling site in Korea carries a penalty of up to 7 years in prison or fines up to 70 million won ($50,000).

A Jeju police official said, “The crackdown on illegal gambling sites is continuous, and we will take a strict stance, especially given the risks to teenagers.”

“We will pursue not only the operators and distributors but also ensure the full recovery of illegal profits.”

Korea Considers Legalizing Esports Betting

The police did not reveal what the teenagers were gambling on, but most forms of online betting are prohibited in the country. Currently, the only legal sports betting product is operated by the state-run Korea Sports Promotion Foundation (KSPO). 

This covers major sports like football, baseball, basketball, but not esports, and bettors are held to strict wagering limits. 

There have been discussions about adding esports to the betting options. The state-backed “Esports Toto” would create moneylines for esports match betting. 

The Korean Esports Association (KeSPA) stated that opening up esports betting would further support the industry and help grow Korea’s digital economy.

Earlier this year, South Korea announced the creation of the Korean Esports League (KEL). The esports market in the country generated $69 million in revenue in 2024 and is projected to grow to $237.3 million by 2030. 

Teenagers are fueling growth in the industry with many flocking to gaming cafes, referred to as PC bangs, such as the ones in the illegal gambling case. A recent survey also showed that over 70% of young people in the country have watched an esports competition online.