In its bid to combat illegal online gambling, the Hong Kong Jockey Club (HKJC) introduced a range of digital products, offering punters live broadcasts of selected football matches and real-time data on horse races on tablets and smartphones.

Punters can also make instant fund transfers between their betting accounts and nominated bank accounts.

Despite having a monopoly on online betting in Hong Kong, HKJC estimated illegal betting on horse racing at US$12.8 billion (S$17.6 billion), nearly matching its turnover of US$13.8 billion last year.

According to an earlier Bloomberg report, HKJC reckoned that in the financial year ended March 2010, the government lost out on at least HK$2.6 billion (S$460 million) in racing taxes because of illegal bookmakers.

With HKJC being the city's largest single taxpayer and biggest source of charitable donations, there is a lot at stake for the government if it does not regulate the sector.

In 2014, Singapore's then Second Minister for Trade and Industry S. Iswaran, together with representatives from the National Council on Problem Gambling, visited Hong Kong to look at how it manages online gambling.

The changes to tackle illegal online gambling have made a big difference. In August, HKJC reported a turnover of HK$202.7 billion for its financial year ended June 30, up by almost 6 per cent, while the government collected a record HK$20.9 billion in duty and profits tax.

Despite the economic downturn, football betting saw the biggest gain of 10.9 per cent at HK$86.8 billion.

Technological advancements have led to more illegal gambling platforms being made more readily available in recent years. A study tracking Web traffic found that at least 230,000 local residents patronise illegal gambling websites each month, HKJC said on its website.

The betting losses incurred each year are about HK$12 billion, or about 60 per cent of the government's Community Care Fund, said HKJC.