Duan Huiqiang, who works for a Guangzhou-based e-commerce website, spent his life savings of 160,000 yuan (around $27,000) in one week, hoping to win a Mercedes-Benz.

Online gambling in China has taken many forms in recent months, from betting on Euro 2016 matches to taking out “insurance” on Taylor Swift’s love life. In Duan’s case, he achieved financial ruin by tapping into another emerging form of gambling: “cloud purchase.”

For just one yuan, a player can win a luxury car, or perhaps the latest iPhone, in a kind of raffle. There’s just one catch: it’s online.

The website that swallowed 27-year-old Duan’s savings, One-Yuan Cloud Purchase, is just one of hundreds of virtual gambling rings that offer prospective bettors a wide range of appealing jackpots.

According to a survey by the Professional Committee of Media Shopping, a regulatory body of China’s General Chamber of Commerce, there are about 400 similar cloud purchase websites in China, including industry giant Netease, which joined the NASDAQ-100 Index in March.

These websites look just like China’s Taobao marketplace or its American equivalent, Amazon.com: Users choose what they want to buy, pay online, and wait for the product’s arrival. The difference is that on websites like One-Yuan Cloud Purchase, players buy lottery numbers for one yuan each, then wait for the website to reveal the winning number. Chances of success depend on the number of people playing, with the websites hoping for everyone to keep tossing in their one yuan until they either win or go bust — usually the latter.

Gambling has been banned in mainland China since 1949, but it was partially lifted to make way for the welfare lottery in 1987 and the sports lottery in 1994. Both lotteries are government-backed and under strict oversight. Their profits for last year amounted to 367.8 billion yuan.

Liang Zhijun, founder of One-Yuan Cloud Purchase, has denied accusations that his website is nothing more than an online casino. “We are merely offering a new, interactive shopping experience for young people,” Liang told Sixth Tone.

A representative of the Market and Quality Supervision Commission of Shenzhen Municipality who took a call from Sixth Tone but refused to give her name said Liang’s company had acquired its business certification in May 2012, in the category of “e-commerce or online selling.”

“We sent our staff to check the company’s credentials when they applied, but the check would not have asked whether the company intended to be an online casino,” she said, adding that if the website really is in the gambling business, that this could only have happened after it received its business certification.

“We haven’t received enough complaints from customers yet, but if this is true and customers are concerned about their rights being violated, then we will carry out a full investigation,” the representative told Sixth Tone.

Over the past few months, hordes of net users have flocked to the game because, in the words of Duan, “the prizes are so awesome.”

For players like Duan, they’re holding out hope that if they’re lucky, it’s entirely possible to win a Benz or an iPhone with a paltry one-yuan investment.

“It’s no big deal to pay just one or two yuan, but paying more means more numbers, which increases my chances of winning,” Duan said. “That’s how I got trapped.”

Duan came from the small and impoverished village of Zhuzhou in Hunan province. He said that growing up in poverty only ever motivated him to work harder and save more. His money-hoarding ground to a halt in 2015, though, as cloud purchase became popular via shares on WeChat Moments — a type of newsfeed on China’s most popular messaging app.

At first Duan was cautious, betting just a few dozen yuan in raffles for smaller prizes. But hearing stories of others hitting big jackpots, winning cars and apartments, emboldened him to throw more and more money into the game. By 2016 Duan was betting thousands of yuan at a time, and winning two iPhone 6 Plus handsets and a bar of gold — together worth a fraction of the money he had invested — elevated him to a cloud beyond the reach of good judgment.

After spending 160,000 yuan in six days, Duan, nearly penniless, realized his dreams of wealth were shattered.

But among his fellow gamblers, there always seemed to be someone enjoying a long winning streak full of fancy cars and iPhones. “How could anyone be so lucky?” Duan said.

Liang of One-Yuan Cloud Purchase said there are no ghost accounts or faked wins on his site. “The lucky ones who win repeatedly are just that: lucky,” he told Sixth Tone.

But Liang did admit that there can sometimes be a lack of transparency in his business, as there is no way for users to verify whether “winning” numbers are chosen fairly, or whether the frequency of winning is actually as high as it seems. Banners warning of gambling addiction Liang said were displayed on the site’s homepage appeared to be missing.

Liang also said there are disclaimers on the website saying that all proceeds go toward environmental protection and natural disaster relief, though the disclaimers provide no details of where specifically the money will go.

Duan, for one, was not satisfied with Liang’s comments, so he went to the police and reported Liang’s platform as a gambling con.

A police officer from the Donghuan police station in Guangzhou, who was not authorized to speak to media, told Sixth Tone that they received Duan’s complaint in early June and are still investigating the case. They declined to say definitively whether One-Yuan Cloud Purchase is a platform for gambling.

Duan is not the only person who feels he’s a victim of online raffles. Chen Xiyang, a supermarket cashier in Beijing, said his addiction to gambling websites nearly ended his marriage.

When he saw that a friend had won a suitcase on One-Yuan Cloud Purchase, Chen was curious. He ended up investing a great deal of time — and nearly 50,000 yuan — in the platform, hoping for a car, but ended up with nothing. “My wife thinks I’ve become an irresponsible gambler,” he said. “She’s asking for a divorce.”

The Professional Committee of Media Shopping told Sixth Tone it has logged thousands of complaints of fraud and cheating from users of a number of cloud purchase websites.

In its latest newsletter, the committee also branded cloud purchase online gambling. “These sites look like they offer online shopping, but in reality they deal in odds instead of goods,” the bulletin said, “and that constitutes online gambling.”

Wang Bo, the committee’s sectary-general, told Sixth Tone that he and his colleagues surveyed 40 cloud purchase platforms, including 23 websites and 17 apps. “These platforms effectively operate as lotteries, but without the necessary business licenses,” Wang said. “They avoid legal oversight by portraying themselves as virtual shopping malls.”

Wang also told Sixth Tone that a legal team will take on cloud purchase to protect public interest. “We are still in the early stages of evidence collection,” he said.

Liang of One-Yuan Cloud Purchase told Sixth Tone that the committee has misinterpreted his business: “No one from the committee has even come to talk to me,” he said.

Wang said his office had never contacted Liang or his platform, though their researchers were conducting an analysis. “It’s a random check, and we don’t want to contact platforms at this early stage in case we’re misguided,” he said.

Despite having reported the site to police, Duan still bets on One-Yuan Cloud Purchase.

“The game is such a fraud to me now, but I have to play on,” he said. “I’m in too deep to walk away.”

Additional reporting contributed by Qi Yue.

(Header image: Jacom Stephens/Vetta/VCG)