In the early hours of July 24, a team of Shanghai police broke up the mainland's biggest gambling operation of the World Cup, which had handled 1 billion yuan worth of bets during the tournament. They broke into the head office of the syndicate, seizing 17 million yuan and HK$1 million in cash, 10 computers used to place the bets and three passenger cars used to collect money and deliver winnings, and arrested 17 people, including its chief, Ren Shen. Ren and his team were only the tip of the iceberg - foreign media estimates put the amount bet by Chinese on the World Cup at between 50 and 100 billion yuan, putting China among the biggest gamblers on the tournament, on which about US$70 billion was bet, up from US$60 billion on the World Cup in Japan and South Korea in 2002. It is several times the 30 billion yuan bet each year on the country's official soccer lottery. It was gambling as much as the love of soccer that had mainlanders addicted to their televisions throughout the month of the World Cup, making it almost the sole conversation topic for some. According to a survey by a research institute at Beijing University, more than 600 billion yuan leaves China each year in betting losses. What makes this extraordinary is that all these bets are illegal - the communist government outlawed gambling when it took power in 1949 and the only legal betting is in Hong Kong and Macau. For the government, gambling is a three-fold danger - the uncontrolled outflow of capital, the flouting of law and nurturing of organised crime despite repeated police campaigns, and the damage to individual families who run up debts they cannot pay. Everyone has heard anecdotes of the evils of gambling - losing the children's school fees and the family home, wives who divorce their husbands and people who in despair take their own lives. The government is especially sensitive because the gambling boom has coincided with an increase in the wealth gap. Millions of Chinese see their neighbours buying fancy cars and expensive homes but will never be able to afford these luxuries through their normal jobs. For them, gambling represents the only hope of making a fortune. It is the internet that has made a nonsense of the government regulations, by enabling global companies to reach the mainland gambler. Globally, there are about 330 Chinese-language gambling websites, based in the US, Britain, Southeast Asia, Hong Kong and Macau. The companies set up finance companies in Hong Kong and Macau to handle the flow of money. It started in earnest after October 2001 when China launched a soccer lottery, allowing punters to predict wins, losses and draws in nine matches in Italy's Serie A and four in the English Premier League. This fuelled interest in European soccer. The watching of domestic soccer has waned because of low standards and widespread corruption. National and regional television channels broadcast several live games from Europe every week, with replays and analysis, while newspapers and magazines provide detailed information on the teams and players. The foreign sites offer more choice and flexibility than the domestic lottery and are out of the control of the authorities. 'Most serious is internet soccer gambling, with collusion between foreign and domestic syndicates,' said Zhu Entao, assistant to the minister of public security. 'Nearly all the profits go offshore. The sums involved are millions, tens of millions and even more than 100 million yuan. The outflow of money is enormous. 'If we do not take measures and this continues for a long time, it will harm the national economy and the exchequer. The laws against gambling are out of date. We must consider administrative measures.' On the mainland, the syndicates operate like businesses, with agents and representatives who deal with the clients. Ren operated as the representative of a foreign company. He told police that he was the principal agent of a foreign gambling syndicate which paid him a commission as well as a percentage of the losses which the clients made. He said that there were two tiers of agents, with the second tier dealing directly with clients and assessing their creditworthiness. Clients place money on deposit with the syndicate and are given a codeword or number to identify themselves. They make bets via mobile telephone, computer or short messages. Underground banks process the transactions, moving the money in and out of China. To avoid detection, the websites often change names and addresses and use servers outside China. Those who work in the syndicates keep as little information as possible, making it hard for police to collect evidence. 'Many of our clients think that they are very smart and can make a fortune in a single day,' Ren said. 'They are fantasising. Gambling companies never lose money. The staff who work for them have much more specialist knowledge than you. According to the rules, if you bet 100 yuan, you can only win 80. If you lose, you lose all the 100.' During the World Cup, punters could bet on anything - the result after 90 or 120 minutes, who would score and when, who would receive a yellow or red card, with betting before and during the game. The best-known gambling chief is a Taiwanese named Yu Kuo-ju, a minor triad boss who moved to the mainland in 2002 and became the agent for a syndicate based in Costa Rica. He used door-to-door salesmen and women to get customers, with operations in Beijing, Shanghai and Guangzhou, to bet on football in Europe, Latin America and Asia. The Taiwan press estimate that he has since 2002 earned more than NT$10 billion (HK$2.36 billion) and call him the most successful Taiwanese businessman on the mainland.