There have been 21 arrests including two assistant trainers and four stable racing staff are accused of passing on inside information.
Operation Iron Triangle was launched by the Hong Kong Jockey Club (HKJC) Independent Commission Against Corruption (ICAC) on Saturday.
The ICAC said both organisations “do not tolerate any corrupt activities from any racing staff”.
Hundreds of millions of dollars are regularly won and lost gambling in Hong Kong, but betting is tightly regulated and stiff penalties including big fines and prison sentences can be handed down for breaking the rules.
The investigation has centred on a betting syndicate at a residential address in Tsuen Wan.
ICAC stated that 15 people were operating the underground “corrupt and illegal” bookmaking syndicate from a residential premises in Tsuen Wan with the assistance of the six Jockey Club staff members.
“While enquiries are continuing, no further comments are available at this stage,” said an ICAC statement.
“The HKJC has rendered full assistance to the ICAC during its operation. The ICAC and the HKJC do not tolerate any corrupt activities.
“The two organisations will continue to liaise and cooperate closely to combat related crimes and keep horse racing in Hong Kong clean.”
A similar situation occurred with fellow Australian Chris Munce in 2007, but he was sentences to 30 months in jail after being found guilty of selling tips after an ICAC investigation.