Korean casinos plunge after report China arrests promoters

A Seven Luck casino in Seoul, South Korea

Korea casino operators Paradise Co. and Grand Korea Leisure Co. plunged in Seoul trading after a report that China arrested 14 South Koreans including the companies’ employees for allegedly marketing to Chinese gamblers.
The Korean nationals were arrested Wednesday and face charges of luring Chinese citizens to casinos and violating foreign currency laws, the Yonhap News agency reported Friday, citing a South Korean Embassy official it didn’t name.
On Friday Paradise closed 12 percent lower at 24,800 won in Seoul, the lowest in more than a month, after dropping 13 percent on Thursday. Grand Korea fell 14 percent, extending the previous day’s 9 percent slump. The Kospi gained 0.3 percent.
Paradise lost contact with six employees who were on a business trip to China and is checking on their whereabouts, said a company official who declined to be identified, adding that the staff weren’t casino marketers. A South Korean embassy staff member who answered the telephone in Beijing declined to comment on the arrests. Calls to Grand Korea weren’t answered.
Paradise, South Korea’s largest operator of casinos catering to foreigners, is increasing gambling space to take advantage of the boom in Chinese visitors, its Vice Chairman Lee Hyuk-Byung said in February, just as China started a crackdown on promoters working for foreign casinos.
Chinese authorities are focusing on casino operators from neighboring countries that have set up offices “to attract and recruit Chinese citizens” to gamble abroad, a Ministry of Public Security official said in February. The clampdown came amid Beijing’s campaign against corruption that’s prompted high-stakes gamblers to avoid Macau. Bloomberg