South Korean Men Jailed for Selling Gambling Sites to North Korean Hackers

Three men from South Korea have been slapped with prison sentences for working with North Korean hackers to develop and distribute illegal gambling websites. Sentences of Three to Four Years in Prison The case uncovered a highly lucrative cyber operation with alleged ties to Pyongyang’s intelligence agencies. The Seoul Central District Court formulated the official sentences on Thursday, November 12, with one defendant receiving four years in prison, and two accomplices sentenced to three years each. The alleged ringleader, identified by his surname Kim, had previously been sentenced to five years. What Happened to the Money? According to South Korean media reports, the network earned approximately 23.5 billion won ($17.6 million) between 2022 and 2024 by selling 16 illegal gambling websites to operators in South Korea. More than 7 billion won ($5.2 million), an amount representing roughly 30% of the proceeds, was transferred to North Korean hackers who were directly involved in developing and maintaining the platforms. Investigators claim that the developers are linked to North Korea’s General Bureau 313 and Reconnaissance General Bureau, two organizations that are associated with the country’s intelligence and cyber operations. Kim reportedly got in touch with North Korean developers operating from China and commissioned gambling software. This included a mobile version of the slot game Sea Story, also known as Bada Iyagi. However, their arrangement covered not only the initial development of the websites but also ongoing maintenance, technical support, and security management. The two accomplices allegedly assisted with marketing the newly developed software to potential customers via X and Telegram. Their sales pitches reportedly focused on the relatively low cost of setting up gambling websites. The Language Gave Them Away In total, authorities said Kim allegedly exchanged over 1,100 messages with the developers using Telegram and other communication channels, mostly discussing technical problems and asking for assistance. One of the defendants, identified as Kim’s younger brother, said that he had no clue that the developers originated in North Korea. Prosecutors, however, challenged his account by pointing to language they used in communications. One noteworthy example was the use of the word “sonjeonhwa,” a term that North Koreans use to refer to a mobile phone. The court decided to convict two defendants under South Korea’s National Security Act, alongside gambling-related charges. The third was convicted of operating illegal gambling facilities. In handing down the sentences, the judges cited both the national security implications of the defendants’ cooperation with North Korean developers and the wider social damage caused by illegal online gambling. North Korea’s Gambling Software Business The case adds to longstanding concerns in South Korea that North Korean technology workers are supplying software and services to criminal gambling operations abroad as a source of revenue. In 2024, South Korea’s National Intelligence Service exposed a suspected North Korean software development operation in Dandong, China. According to information from the investigation, developers who pretended to be Chinese nationals offered to build illegal gambling websites for around $5,000, with maintenance services costing an additional $3,000 per month. The operation reportedly gathered 15 developers in total and was connected to Bureau 39, an organization tied to raising funds for the North Korean regime.