Macau gambling group Suncity shares plunge after chairman arrested

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Macau gambling group Suncity shares plunge after chairman arrested

HONG KONG Reuters -- Shares of Macau gambling group Suncity Group Holdings Ltd fell to a new all time low on Tuesday after its chairman was arrested for alleged links to cross-border gambling and said he intends to resign from the company.

Alvin Chau, who is the co-founder of Suncity - a junket operator that brings in high rollers to play at casinos, extending credit and collecting on their debts - was arrested by Macau police on Sunday.

Suncity's stock fell to a record low of HK $0.133, its lowest since its listing in 2007.

On Friday, authorities in Wenzhou, a city in eastern China, issued an arrest warrant for Chau, accusing him of operating gambling activities in mainland China where gambling is illegal.

The investigation involves Russia's Tigre de Cristal resort, which is close to China's northeast border and is controlled by Hong Kong-listed Summit Ascent Holdings, of which Suncity is the controlling shareholder.

Suncity said late in the day that Tigre de Cristal was involved in cross-border gaming by soliciting customers in mainland China was untrue.

It said that the company's operations would not be impacted in the event that it didn't have Chau's support.

Macau's prosecutor's office said in a statement on Monday that the group was suspected of using the world's largest gambling hub as a base for an illegal live web betting platform in the Philippines that attracted mainland Chinese.

Suncity accounts for about a quarter of Macau's gambling revenue, according to analysts.