CNET : News : Story Tuesday, January 25, 2000 

Malaysia to crack down on e-gambling
By Julian Matthews
Tuesday, January 25 2000

KUALA LUMPUR--Malaysian authorities are considering coming down hard on cybercafes that have been turned into casinos by offering illegal gambling over networked PCs.

Inspector General of Police Norian Mai said Friday that police had identified 21 such cybercafes in the capital city and were gathering information of how widespread the activities were in other states.

"We are worried if this is not controlled as soon as possible, it may have serious effects later," Norian told reporters at the city police headquarters.

He said cybercafes are for Internet services and to educate users and not to encourage gambling.

Norian said police may recommend to the government that action on errant operators be taken under the Restricted Residence Act, an archaic piece of legislation that banishes law-breakers to remote districts.

The Sun reported Sunday that a typical cybercafe-turned-gambling den usually does not have signages outside or conduct checks for proof of age. Players buy electronic chips that are logged on the individual computer and can play electronic versions of poker, blackjack, baccarat, keno, craps, roulette, and slot machine-type games.

Winners claim cash pay-outs from a cashier who acts as a banker and also monitors the gambling. A shop assistant at a cybercafe was quoted as saying that some patrons bet hundreds of ringgit and, if lucky, can win thousands, but that the cybercafe usually made a profit.

Cybercafes have been mushrooming around the country based on increased awareness of the Internet and a concerted government push to draw technology investments under its Multimedia Super Corridor (MSC) initiative.

They are usually frequented by schoolchildren and youths and some are open around-the-clock.

Two weeks ago, it was reported that three teenagers in Johor had rung up RM40,000 (about US$10,500) in gambling debts to such computer-based gambling operators and had gone into hiding.

Families of the boys aged 16 to 18 had also been harassed by thugs and had sought help from the branch office of political party, the Malaysian Chinese Association (MCA).

MCA district chief Freddie Long said that the boys fell prey to the operators after being lured to work in November with high monthly salaries and up to RM500 in credit to gamble, but eventually got hooked on the games and found themselves heavily in debt.

Long estimated there were no fewer than 124 virtual casinos operating as licensed cybercafes in Johor Baru and urged authorities to crackdown on the operators.

"Local authorities, in particular, should take immediate action before more youths fall prey to these unscrupulous operators," he said.

Long said a similar case occurred in November, when the parents of a 17-year-old boy were forced to sell their house after he rang up RM40,000 in gambling debts.

In March last year, Prime Minister Mahathir Mohamad, who is currently abroad, stepped in and cancelled an earlier directive to monitor cybercafes and take down personal details of customers as it was against the spirit of a government guarantee to potential investors that Malaysia would not censor the Internet.

On Saturday, however, Deputy Energy, Communications and Multimedia Minister Tan Chai Ho told local news agency Bernama that the government was now considering new legislation to check "unhealthy activities" in cybercafes.

"We are studying whether to require the cybercafe operators to register with the ministry so we can at least know their actual number," he said.

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