138Bet: Closed But What Happened?

138 logoGambling website 138.co.uk has been shut down, with the company closing down all of its various sites around the world. The interesting thing, as far as the UK site is concerned, is that it was owned by a different company to the rest of the network, yet it was shut down along with the other sites as 138 ceased to be. The question is, what happened and why was it decided that there was no more room for it to operate? Established in Asia, the company moved to get its name known in the United Kingdom by sponsoring Watford Football Club.

That happened between 2013 and 2018, meaning that the foreign bookmaker was propelled in the to consciousness of Premier League fans when the Hornets gained promotion to the top-flight in 2015. That wasn’t enough to save them from the chop when the parent company decided that its time was up, however. Having begun life as 138SunGame, the company re-branded in 2013 when it began its push into the European market. Though it was mainly aimed at Chinese ex-pats, it was strong enough to appeal to British punters.

In The Beginning

138sungame old advert

Sun City Gaming Promotion Company Limited was founded in 2005, launched a VIP gaming room at StarWorld in Macau. It quickly went on to become one of the main junket operators in the area, launching VIP rooms in the likes of Cambodia, the Philippines and Australia. In the years that followed, the company launched numerous different businesses, including that of 138SunGame. That was predominantly aimed at the online market in Asia, so when it decided to move into European markets it was necessary to explore the possibility of a rebrand. Eventually, the name 138 was decided upon.

Though it was targeted at Chinese ex-pats, the nature of operating a site in Europe was such that it obviously needed to appeal to European bettors too. 138.com was run by Xela Holdings Ltd and TGP Europe, who were based on the Isle of Man. They soon decided to launch a UK-facing site, which was 138.co.uk and operated under the licence of Fesuge Limited. Fesuge Limited took out licences for a remote casino and a sportsbook for its sites, starting in 2012. The two sites its licenses were for were global.138.com and 138.co.uk.

The Sites Develop

138 homepage screenshot

Having been established in Asia and mainly aimed at Asian punters living in the United Kingdom, it took a while for 138 to establish itself in what was a crowded market. The decision to sponsor Watford Football Club and the subsequent promotion to the Premier League for the Hornets was a big step in the right direction, seeing the site reach a whole new audience. The Asian background of 138 was evident for everyone that visited the company’s website, being setup in a way that appealed to Asian audiences more readily than British ones.

The site offered more than just niche Asian markets, however, and so customers soon began to see the appeal of a relatively pared back website and betting platform. They offered a huge number of events, especially to those that liked to place bets In-Play, ensuring that their live betting interface was amongst the bet in the business. The fact that it also offered Live Streaming gave it an appeal that not all betting sites were able to offer, using the technology of FSB to ensure a good customer experience for any and all that chose to use it.

As 138 began to enjoy an increase in its UK-based clientele, it decided to completely revamp the website ahead of the 2018 World Cup. That, of course, was always likely to be one of the biggest sporting events for every bookie so it made sense for them to want to ensure that the customer experience was the best that it could be. It remained very basic in its nature, but that allowed for fast transactions and a smooth time moving from page to page and market to market. As you might imagine, the Asian influence of 138 was most notable on the company’s casino.

One of the biggest appeals of 138 to savvy punters was the fact that the company’s global appeal allowed people to bet on all sorts of markets that they might not otherwise have had access to. That included as many as 200 different leagues in football, to say nothing of competitions such as the Malaysian Challenge Cup, which not all sites will have been in the know enough to offer markets on. The company made sure to exploit the niche in the market that came from being able to offer Asian markets to British customers on a regular basis.

The High Street Branch

138 high street shop in londonOne of the most surprising things about 138 is that the company made an attempt to launch a high street branch. Given the fact that the world of high street betting has largely been dominated by the likes of William Hill, Coral and Ladbrokes for years, with a few independent bookmakers clinging on in there for as long as possible. Whereas most bookies started life on the streets and then made the move online, 138 decided to make a name for itself with online bettors before opening a physical branch and hoping the customers would still come.

The brach was opened in London, on the way from Leicester Square to, no surprises, China Town. Given how much real estate costs in the nation’s capital at the best of times, it was a bold move from the Asian company. It ended up being a short-lived thing, with no attempts to open other branches in different areas of the country. Liverpool, for example, has the oldest China Town outside of mainland China, alongside a strong love of sport, but there was never a move to open a branch in the north-west from 138’s parent company.

The First Signs Of Trouble

fesuge ltd 138 ukgc failings 2017

As far as most punters were concerned, the first signs of trouble with Fesuge Limited came about in January of 2017. That was the point at which the company was given a warning by the United Kingdom Gambling Commission about its unfair language in a promotion. The company was issued with the warning alongside The Gaming Platform Europe, with a voluntary settlement being reached as a result. There were a number of failures that occurred as a result of a promotion around the Cheltenham Festival in 2016, with the operators suspending more than 5,000 accounts due to suspected bonus abuse.

The UKGC produced a public statement at the start of 2017, encouraging operators to ensure that their terms and conditions were fair and easily understood by punters, especially when it came to the bonus promotions that they offered. It also asked them to make sure that they could act quickly when it became clear that a customer was going to suffer as a result of poorly worded bonuses. Both companies were licensed by the Isle of Man and the Gambling Commission at the time of the incident, with the UKGC and the Competition Markets Authority working closely together.

On the third day of the 2016 Festival, TGP and Fesuge promoted bonuses for four remote betting brands. As is often the case, the offers were subject to their own terms and conditions in addition to the general Ts & Cs of both companies. There was an offer for bonuses that were promoted to both new and existing customers, but no customer was allowed to have multiple accounts. Clause 15.2 of the terms stated the following:

“In the event that we suspect that you or any other Player is abusing or attempt to abuse a bonus or other promotion, or is likely to benefit through such abuse we may block, deny or suspend, withhold or cancel the account of any such player, including your account if we determine that you are involved in such.”

In the wake of the offer, more than 5,000 accounts were suspended. Both the Gambling Commission and the Independent Betting Adjudication Service received numerous complaints, with more than 1,000 cases being referred to IBAS’s website. It was clear that something wasn’t right, which both TGP and Fesuge acknowledged. It became obvious that their general terms and conditions weren’t clear or detailed enough, so they both moved to clarify things and worked with external solicitors in order to look over all of their terms.

One of the biggest failures was in not being able to handle the volume of new account and an inability of the anti-fraud tools to correctly identify people opening multiple accounts. They ended up being reactive instead of proactive, whilst they procedures in place to spot bonus abuse were inadequate. The result was that the Gambling Commission found that both companies had breached their licensing agreement, with a settlement needing to be reached. It was a voluntary settlement and was made up of the following clauses:

  • An agreement to publish a public statement outlining the failures
  • Changes to the terms and conditions
  • An implementation of a wider package of measures that improve compliance in key areas
  • The contribution of £7,000 to the Commission to cover the costs of the investigation

It was also stated that neither company benefited financially from the failures, but instead actually ended up costing them a ‘substantial amount of money’ in fixing things. The case also highlighted problems in terms and conditions for offers that all remote and non-remote betting operators needed to have a look at and ensure that similar mistakes weren’t going to happen in the future.

The Company Closes Down

138 site with closed stamp overlaidThe exact reasons behind the closure of 138 isn’t clear. What we do know is that Fesuge Limited, which was incorporated in March of 2013, changed its status from ‘Live’ to ‘Dissolved’ between February 2021 and May of that year. In March of 2021 it became inactive, meaning that it stopped operating completely. In May of 2020, reports began to emerge that the site was shutting down, initially stating that customers would still be able to withdraw their funds before alerting suppliers that their services were no longer needed and then going dark.

There was a sense that it might have shut down because its support services in the Philippines were struggling to operate due to what was going on around the world. That didn’t seem hugely likely, however, considering the fact that the entire site as offline. There was also a suggestion that Suncity Group, the parent company of the 138 business, was under pressure from shareholders to stop any links to online gambling operations. Quite what the truth is remains unclear, but it’s certainly true that a decision was taken to end the existence of 138 as a going concern.

Was It Shut Down By The Chinese State?

china flag waving motionIn the middle of 2019, Suncity became the focus of investigations by Chinese state media. There was an accusation that the company was the single largest online gambling operator that was targeting customers on the Chinese mainland, which was illegal. Though the company publicly stated that all of its operations were legal, there was evidence that it was operating a ‘proxy betting operation’ from the Philippines-based VIP rooms. This led to the eventual agreement not to run any operations that were not legal under Macau’s laws.

The focus of the Chinese state media will have been uncomfortable for the company’s shareholders. This went even further when the Suncity Group Chief Executive Officer, Alvin Chau, was arrested. The shares of the business dropped by as much as 48%, with Chau resigning from the company. It is likely that that issue resulted in the parent company deciding that enough was enough in terms of the betting side of the business, shutting it down permanently. Whatever the reasoning behind the decision, it saw one of the fasting rising betting companies in the UK shine bright before extinguishing entirely.