Yeah, I know of an identical incident in my country. Some police officers from my country stop a bus and arrest a man with his phone. Later we found out that the man was involved in gambling activity and at that time he was holding 22 Bitcoin in his mobile Bitcoin wallet. I am not sure if that man was dumb to do that or not conscious enough to carry his Bitcoin within his mobile phone.
I don't think there is nothing wrong with him having his bitcoin along with him always but the truth is that the country is messed up and I don't know your country but if the guy can prove that his winnings are from gambling then I think their shouldn't be any reasons to hold him down except gambling is illegal in your country .
On the other hand, if someone already has over 22 Bitcoins in his possession, then what really must have hindered him from having a hardware wallet?
Well I'm sure only the victim can answer perfectly for himself but whatever the case might be, we shoukd learn how to trade with caution while handling Bitcoin and cryptocurrency in general especially if it has restrictions in our country