500.com Limited Announces Appointment of MaloneBailey as its Independent Registered Public Accounting Firm and Non-reliance of

   500.com Limited Announces Appointment of MaloneBailey as its Independent
   Registered Public Accounting Firm and Non-reliance of Previously Issued
                             Financial Statements

PR Newswire

SHENZHEN, China, September 28, 2020

SHENZHEN, China, September 28, 2020 /PRNewswire/ -- 500.com Limited (NYSE:
WBAI) ("500.com" or the "Company"), an online sports lottery service provider
in China, today announced that (i) Friedman LLP ("Friedman") has resigned as
its auditor on September 23, 2020; and (ii) the  Company appointed
MaloneBailey, LLP ("MaloneBailey") on September 27, 2020 to conduct an audit
of the Company's consolidated financial statements and effectiveness of its
internal controls over financial reporting for the fiscal year ended December
31, 2019, and to re-audit the Company's consolidated financial statements and
effectiveness of its internal control over financial reporting for each of the
fiscal years ended December 31, 2017 and 2018. Pursuant to the Company's
articles of association, the decision to appoint a new auditor was unanimously
approved by the directors of the Company, including all members of the
Company's Audit Committee, on September 27, 2020.

Friedman has elected to resign as the auditors of the Company because of the
disagreement with the management of the Company on the effectiveness of the
Company's internal control over financial reporting in light of certain
alleged unlawful payments ("Payments") by three former consultants while they
were engaged by the Company in connection with the potential development of
an integrated casino resort project in Japan. The Company is not involved in
any legal proceeding in Japan but has treated the allegations seriously.  As
announced by the Company in its December 31, 2019 and January 16, 2020 press
releases furnished to the SEC on Form 6-K, the Special Investigation Committee
("SIC") of the Company's Board of Directors engaged King & Wood Mallesons
("KWM") to investigate the money transfers and the related conduct of the
Company's Japanese consultants. 

KWM has completed a substantial portion of its investigation, and presented a
preliminary review to the SIC. To date, the SIC, after considering KWM's
findings, did not identify any violation of the US Foreign Corrupt Practices
Act of 1977 by the Company in connection with the Payments or the Company's
prior activities in Japan, which view has been shared with Friedman. The SIC
is also in the process of reviewing the Company's compliance policies,
procedures and internal controls based on the recommendations from KWM, and
the Company has updated and will continue to enhance its policies, procedures
and internal controls as appropriate.  Regardless, Friedman determined that
the Payments may have reflected material weakness in relation to internal
controls of the Company. Friedman further advised us on September 23, 2020
that because some of the Payments had occurred in 2017 and 2018, the allegedly
unlawful purpose of which was not known to Friedman at the date of the audit
reports relating to the Company's consolidated financial statements for the
years ended December 31, 2017 and 2018. Accordingly, the integrated audit
reports issued by Friedman on the Company's consolidated financial statements
for fiscal years ended December 31, 2017 and 2018 should no longer be relied
upon.

The Company's Audit Committee has discussed the issue with Friedman, and it
does not agree with Freidman's conclusion. The Audit Committee is not aware of
any information suggesting that the relevant audit reports are inaccurate or
misleading.  Friedman's audit reports on the Company's consolidated financial
statements for each of the fiscal years ended December 31, 2017 and 2018 do
not contain an adverse opinion or a disclaimer of opinion, or was qualified or
modified as to uncertainty, audit scope, or accounting principles. During
Friedman's term as the Company's independent auditors, except for the
above-mentioned disagreement, Friedman did not have any other disagreements on
any matter of accounting principles or practices, financial statement
disclosure, or auditing scope or procedure, which disagreements, if not
resolved to the satisfaction of Friedman, would have caused Friedman to make
reference to the subject matter of the disagreements in connection with its
audit reports. During each of the fiscal years ended December 31, 2017 and
2018, there have been no other reportable events requiring disclosures, as
defined in Item 16F(a)(1)(v) of Form 20-F.

The Company provided a copy of the above statements contained in the first,
second and fourth paragraphs to Friedman and requested that Friedman furnish a
letter addressed to the SEC stating whether it agrees with the above
statements, and if not, stating the respects in which it does not agree.

During each of the fiscal years ended December 31, 2017 and 2018 and the
subsequent period prior to the Company's engagement of MaloneBailey, neither
the Company nor anyone on its behalf consulted MaloneBailey regarding either
(i) the application of accounting principles to a specified transaction,
either completed or proposed; or the type of audit opinion that might be
rendered on our financial statements, or (ii) any matter that was either the
subject of a disagreement with Friedman or a reportable event. Also, during
each of the fiscal years ended December 31, 2017 and 2018 and the subsequent
period prior to the Company's engagement of MaloneBailey, the Company has not
obtained any written report or oral advice that MaloneBailey concluded was an
important factor considered by the Company in reaching a decision as to the
accounting, auditing or financial reporting issue.  The Company will closely
work with MaloneBailey to complete the audit and review process as soon as
possible. 

As used herein, the term "reportable event" means any of the items listed in
paragraphs (a)(1)(v)(A)-(D) of Item 16F of Form 20-F, and the term
"disagreement" shall be interpreted in accordance with Item 16F(a)(1)(iv) of
Form 20-F and related instructions to Item 16-F of Form 20-F.

About 500.com Limited

500.com Limited (NYSE: WBAI) is an online sports lottery service provider
in China. The Company offers a comprehensive and integrated suite of online
lottery services, information, user tools and virtual community venues to its
users. 500.com was among the first companies to provide online lottery
services in China, and is one of two entities that have been approved by the
Ministry of Finance to provide online lottery sales services on behalf of the
China Sports Lottery Administration Center, which is the government authority
that is in charge of the issuance and sale of sports lottery products
in China.

Safe Harbor Statements

This news release contains forward-looking statements within the meaning of
Section 21E of the Securities Exchange Act of 1934, as amended, and as defined
in the U.S. Private Securities Litigation Reform Act of 1995. These
forward-looking statements can be identified by terminology such as "will,"
"expects," "anticipates," "future," "intends," "plans," "believes,"
"estimates," "target," "going forward," "outlook" and similar statements. Such
statements are based upon management's current expectations and current market
and operating conditions, and relate to events that involve known or unknown
risks, uncertainties and other factors, all of which are difficult to predict
and many of which are beyond the Company's control, which may cause the
Company's actual results, performance or achievements to differ materially
from those in the forward-looking statements. Further information regarding
these and other risks, uncertainties or factors is included in the Company's
filings with the U.S. Securities and Exchange Commission. The Company does not
undertake any obligation to update any forward-looking statement as a result
of new information, future events or otherwise, except as required under law.

For more information, please contact:

500.com Limited 
[email protected] 

Christensen

In China 
Mr. Eric Yuan 
Phone: +86-10-5900-1548 
Email: [email protected] 

In US 
Ms. Linda Bergkamp 
Phone: +1-480-614-3004 
Email: [email protected]

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SOURCE 500.com Limited

Website: http://ir.500.com/