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Gambling News by House of Odds
Tuesday, October 31, 2006
Online gambling firms in £1.6bn merger talks
Two leading online poker and casino firms, PartyGaming and 888 Holdings, have held talks about a £1.6bn merger as the industry scrambles to replace revenues lost through the United States' crackdown on internet gambling. The online gambling industry has been devastated by legislation passed in Washington this month preventing banks and credit card firms processing payments for bets. Analysts reckon PartyGaming earned between 75% and 80% of its revenues from the US. The ban caused shares across the sector to collapse. PartyGaming, which has dropped out of the FTSE 100, has made no secret of its plans to seek a deal with rivals to bolster its business. The firm cancelled its dividend shortly after the US ban and said at the time it hoped to take advantage of slumping share prices. Its chief executive, Mitch Garber, said in a recent interview consolidation was the "most sensible way forward" and told analysts he was in talks with several companies. The Stock Exchange might force a statement today. The desperate state of the industry has led to a frenzied round of talks among leading players. 888 was forced to put out a statement recently denying it was behind a bid for another UK listed firm. "I don't think it will come as a great surprise to learn that all parts of the industry are talking to each other," said one industry source. "How concrete those discussions are is another thing. Consolidation is absolutely on the cards. But I think we might see companies waiting to see how things pan out a little. Companies need to sort out their cost bases, for example." Discussions between PartyGaming and 888 are said to be at an early stage. The firms at least don't have far to go: they occupy the same office block in Gibraltar. A source close to 888 said they had not progressed further than "a coffee and a chat". Another industry source said PartyGaming was also pursuing other options, but an 888 tie-up would have obvious benefits. "Casino and poker are the mainstay of both businesses," he said. The US accounted for a little over 50% of 888 revenues, with the remainder largely from Britain and other parts of Europe. It still has around $100m (£53m) cash, even after it pays a planned special dividend. But its shares have also fallen sharply and the company has dropped out of the FTSE 250.
Online gambling firms are under pressure. The sudden disappearance of a large number of players makes online gaming less attractive to customers both because there are fewer people to play against and the companies are not able to offer the same kinds of jackpots.
Neither PartyGaming nor 888 would comment on the merger discussions.
Culture secretary Tessa Jowell yesterday called for an international agreement on the regulation of online gaming, before an international summit at Royal Ascot. Delegates from 30 countries, not including the US, will meet tomorrow to discuss methods for protecting vulnerable people and keeping the industry free of crime. Ms Jowell said companies would be welcome to operate in Britain but only after agreeing to a "very tough" code on social responsibility.
At its peak, PartyGaming was valued at £7bn on the London Stock Exchange. Despite 33 pages of warnings in its float prospectus, including over a possible ban in the US, investors piled in and the directors cashed in more than £1bn. London became the centre for the industry to raise money. Since the US ban PartyGaming shares have dropped by 70% to 30p and 888 shares have declined 24% to 108p.
The introduction of the Gambling Act three years ago has had little impact on decreasing pokie machines in some regions in New Zealand and it's obviously not working well, says a gambling lobby group. Gambling Watch coordinator David Macpherson said all New Zealand regions had shown a drop in machines in the last three years with a nationwide decrease of 10.1 per cent, but some regions were well below the average. Southland and Waikato both had a reduction of less than 4 per cent. "Some localities within those regions have actually recorded significant increases in pokies," Mr Macpherson said. "It is obvious that the stated aim of the Act, to control the growth of gambling and to prevent and minimise harm caused by it, is not working particularly well in some areas." However, in other regions community concern about the harmful effects of pokie machines was having an impact with numbers decreasing about 15 per cent, he said. "We are pleased that some regions of high pokie concentration, such as the West Coast and Northland, are showing decreases significantly ahead of the national average." Pokie machines are cited by almost 90 per cent of people treated for gambling addiction as the primary cause of their problem.
West Coast Region -15.2 Otago Region -5.8 Waikato Region -3.9 Canterbury Region -8.5 Hawkes Bay Region -7.2 Marlborough Region -13.4 Bay of Plenty Region -5.0 Manawatu-Wanganui Region -8.9 Southland Region -3.7 Taranaki Region -10.1 Northland Region -14.4 New Zealand -10.1 Tasman/Nelson Region -9.4 Gisborne Region -8.2 Wellington Region -8.3 Auckland Region -8.2
A NEW system of licensing for premises that are involved in gambling is to come into force in the UK, and local authorities, including Alnwick District Council, will be at the heart of the changes. The Gambling Act 2005 is taking the licensing and regulation function away from the magistrates' courts and transferring it to local authorities, placing new and extended legal responsibilities on councillors and council officers. The new licensing responsibilities will not come into force until April 30, 2007 but in preparation for this new duty, the district council is consulting with the public on how it proposes to apply these new powers. The Statement of Principles, which is the draft gambling polic,y is available on the council's website or can be posted out to anyone interested. The council welcomes comments and feedback on the draft which will be finalised before the end of the year. Members and officers concerned in the decision making process will undergo training so they are fully aware of the facts and procedures to ensure the authority provides an efficient service.
UK culture secretary Tessa Jowell will this week urge 32 nations to back a code of principles on internet gambling, the first major international measure to regulate the industry as the US imposes a ban. Britain, France, Germany, Spain, Italy, South Africa and other nations will tomorrow meet outside London for talks hosted by Jowell to agree on a code of conduct for companies that offer gambling over the Web.Delegates will discuss age and identification verification systems, including the role of government in smoothing access to high quality data for gambling operators to identify customers. They will also look at social responsibility associated with remote gambling, including the role of government and whether operators should be required to fund awareness campaigns on problem gambling or offer website links to counselling. Delegates from each nation will be asked to examine whether there are any legal or ethical considerations around cross- jurisdiction treatment of problem gambling. A draft of the agreement proposed that nations should agree to "co-operate in development of and share best practice in protecting children and vulnerable people" and to "share findings of research into the remote gambling market". The measures are Britain's attempt to regulate internet gambling instead of criminalising it as US President George W Bush favours. Bush this month signed a law banning credit card companies from collecting payments for online bets. Jowell last week criticised the US for attempting to impose a "new prohibition" against online gaming, saying Bush's measures would prompt fraud and crime by forcing the industry to work illegally from nations that do not regulate the Web.
"America should have learned the lessons of prohibition," Jowell told the Financial Times, adding that the US might "create modern day speakeasies" in the internet gambling industry.
The world's biggest internet gambling companies lost $7 billion (R52 billion) of market value in a day after the US congress passed legislation on September 30.
PartyGaming shares have lost three quarters of their value since then.
The EU is pushing countries to scrap measures that protect domestic companies in gaming.
On October 12, regulators told members such as France and Austria to stop discriminating against international bookmakers and casinos.
NEWLY appointed Criminal Investigation Department director Datuk Christopher Wan Soo Kee has vowed to come down hard on gambling syndicates. Wan said he would suggest to the local authorities to stop issuing new video arcade licenses to check on illegal gambling problems. "I plan to make this my priority. I know many video game operators have been modifying their machines for gambling purposes. " He was speaking after handing over his duties as State police chief to Datuk Koh Hong Sun. Wan takes over from Datuk Fauzi Shaari as national CID director and he begins his duties on Wednesday. He is the highest-ranking non-Malay police officer in the country now and his appointment also marks the first time a Chinese has assumed the post. Wan, 55, was formerly with the Special Branch in Bukit Aman and Malacca police chief before coming to Penang. He said he would use his experience from his stints as the Malacca and Penang police chief to come up with crime prevention initiatives for implementation nationwide.
Gambling -- most of it illegal -- has increasingly been thriving in Laredo, Texas, reported the San Antonio Express-News. Under Texas law, game rooms that feature machines known as eight-liners can award only up to $5 in prizes. But many places in Laredo offer up cash prizes of $40 or more. The Express-News reported that there are 2,423 licensed eight-liner machines in Laredo. That's one for every 43 Laredo residents over 21. Although police have reportedly admitted that most places dole out cash prizes, investigations into the matter have been slowed by a lack of interest or complaints from city residents. Also, there has been little political pressure to step up the efforts, the newspaper said. The increase in illegal gambling is making it harder for law-abiding game rooms. Operators of such game rooms have complained of the slow investigation efforts.
The polished slot machines fill the room with light and noise: a constant click-and-whirl as customers press buttons and pull levers, and bells ringing for winners. The sound of money carries an almost deafening pitch. "It sticks in your head if you play here enough," said Tara Kelley, 26, smoking a cigarette outside Hollywood Slots on Main Street. "I think it's a great sound. Being here is like being in a different world." One year after Hollywood Slots opened on Main Street, and three years after state voters approved slot machines at the commercial harness-racing track, Maine's only slots parlor is thriving. The property, owned by Penn National Gaming, has netted more revenue $32 million and counting than analysts, state and city officials expected. The anticipated rise in police and social service demands have not materialized. And funding from the slots has given Maine's harness-racing industry new life. "There really have not been any glitches or drawbacks," said Jon Johnson, the general manager who transferred from a casino in Mississippi. That message of success has a lot riding on it. The political future of gambling expansion in Maine could very well hinge on Hollywood Slots, and the permanent facility the Pennsylvania-based company will begin building next spring. That $90 million project, across the street from the Bangor Raceway, will be licensed for up to 1,500 slots, three times the number in the temporary facility operating today. In 2003, state voters rejected a proposed casino that would have been run by the Passamaquoddy Tribe and Penobscot Indian Nation in Sanford, but they authorized "racinos," or slot machines at harness tracks. Gambling promoters are circulating petitions for citizen initiatives that allow a tribal-run racino in Washington County and a casino in Oxford County, while gambling opponents are trying to ban slot machines in Maine.
To gambling opponents, what Hollywood Slots calls success is just an illusion.
"They can only win when Mainers lose," said Doug Muir of Kittery, spokesman for No Slots For ME, a political action committee behind the drive to ban slot machines in Maine. "This is a form of gambling that is too addictive, it's too risky and it's too costly," Muir said.
A number of studies show slots lead to gambling addiction faster than other forms of gambling, Muir said. Slots are also connected to higher rates of suicide, crime and other social costs, he said. In terms of the economy, Muir said gaming takes money from other sectors, creating a net loss of jobs. "There is no product made here," Muir said. "It is just a transfer of money from citizens' pockets into their pockets."
From the outside, Hollywood Slots still looks like the buffet restaurant it once was.
Then customers walk into the sparkling lobby, replete with four ATM machines and a security checkpoint. The interior is dressed up with movie memorabilia. There is the sledgehammer wielded by Kathy Bates in "Misery," and the cape Robert DeNiro wore in "Frankenstein." Penn National spent $17 million to create two floors of slot machines, a small restaurant and merchandise shop. "Our guests are learning which machines they enjoy," said company spokeswoman Amy Kenney, during a recent tour. There is usually a line at the door before it opens at 10 a.m. Next week the business is changing its hours. It will be open from 9 a.m. to 1 a.m., instead of 10 a.m. to 2 a.m.
"We don't want to have people lining up out there in the winter," Kenney said. On a gray Thursday morning last week, Hollywood Slots was the only busy place on Main Street. A few hundred cars were parked outside, and by 4 p.m. the lot was nearly full. Johnson said the average daily attendance is about 2,500, and has topped 5,000. Except for a run of summer tourists, nearly all of the players are from Maine.
"It's fun, it's easy, all you do is push the button," said Brenda Radley, 24. Instead of coins, the machines pay out paper ticker tape that players redeem for cash. Radley and her father drive up once or twice a week from Rockland, about an hour and a half away. Bill Radley, 63, has gambled in New Jersey, Connecticut, Nevada and other spots. He would like to see a full casino with table games in Bangor.
"It's good entertainment, whether you win or lose," said Radley, who used to work in the bottle redemption business. Father and daughter usually gamble $20 or $40 apiece, and they don't expect to walk away as winners. For Brenda Radley, it's not just about the slots. "Back when he was doing bottle redemption, working seven days a week, we never had anytime to spend with him," she said. "This is time we can spend together." Bill Radley thinks casinos are good for the economy. That's a familiar sentiment here, where the past is inescapable. From the Hollywood Slots parking lot you can see the 31-foot statue of folkloric lumberjack Paul Bunyan, a tribute to the city's days as a lumber capital.
"We need something in this state," Bill Radley said.
Across the street, drinking a beer at Raena's Pub, Shawn Brad is skeptical. "If it could stay like this, it's enjoyable to a certain extent, it's mostly old people," Brad said. "But you know it can't." If the door is opened to full-scale casino gaming, Brad expects drug use, crime and social deterioration will follow. Bartender Maria Dorso said she can only judge based on what she has seen so far: "For the most part they've been a really good neighbor." Police Chief Don Winslow said the department was called to the property about 75 times since it opened, mostly to deal with minor accidents in the parking lot, and the occasional drunken patron.
"I have been in this industry for 30 years, I have never seen the crime and the problems that people talk about, and I have worked everywhere," said Johnson, the general manager.
Johnson said his staff is up front with guests about what they can expect from the experience at Hollywood Slots. They post information for guests who feel they might have a gambling problem. The state Gambling Control Board has created a new counseling service, which should start up next year. "What I always tell them, we pay back 93 percent of the money wagered, which means that, yes, there is a portion that we keep," Johnson said. "Casinos are not here because everybody wins. This is really entertainment."
The profile of the average player is a middle- or upper-middle-class woman who is over 50 years old, Johnson said. But several players disputed that claim last week.
"A lot of the people who play don't really have the money to be here," said Tara Kelley, a native of Brewer. "They find money wherever they can, and they stay here as long as they can."
Net revenues have climbed steadily, from around $2 million last November to $3.45 million in September. The money flow works like this: Players have bet about $470 million since the opening. About $440 million of that has gone back to players. One percent of the gross, or about $4.7 million so far, has gone to the state General Fund.
The remaining $26 million or so was net revenue. The company gets 61 percent of that, and the state disperses 39 percent to various funds. "It is smooth with a capital 'S,'" said Robert Welch, executive director of the State Gambling Control Board. The agency reviews financial records, and Welch has conversations almost daily with Johnson and other managers.
"We have inspectors on the floor seven days a week. This really could be a battle, and it isn't," Welch said. Slots revenues have generated more than $4.5 million directly for the harness racing industry, along with indirect help. "The horsemen have been the primary beneficiaries," said Fred Nichols, director of racing at Bangor Raceway and Off Track Betting. For the season that runs through Nov. 5, purses at this raceway totaled $1.2 million, more than double the $524,600 from last year. There were 44 race dates this year, 28 last year, Nichols said. Average daily attendance was up slightly.
How long that prosperity will last, though, remains to be seen. There is the potential for a ballot question seeking a slots ban, and other uncertainties. The five-member state Gambling Control Board has issued a nonbinding moratorium on any new facilities. The ban does not have any practical effect, but simply represents the majority opinion of the board.
Board Chairman George McHale of Orrington said Hollywood Slots appears to be running smoothly now, but more time is needed to evaluate the full impact.
Don't bet the schoolhouse on this loser of an issue
Criticism against state Issue 3 could easily be compiled a la Elizabeth Barrett Browning. "Let me count the ways ." While proponents dub Issue 3 "Learn & Earn" for its wondrous tuition-generating effect, opponents say this proposal to allow 31,500 slot machines statewide is a smokescreen that would make a handful of private racetrack owners and developers very, very rich. Also, some of the numbers are in dispute. While supporters, for example, say the measure would yield some $850 million each year for Ohio college students, the state's own budget and management office estimates that the annual ca-ching! of slot machines would generate not quite $325 million for tuition. Then, too, there's criticism bubbling up from Columbus, from folks who say Issue 3 is disproportionately nice to Cleveland - where, with voter OK later, slot machine operations could blossom into full-scale gaming tables. Oh, and let's not overlook the much ballyhooed social costs. You know, "the evils of gambling" and all that - no small consideration, as I see it. Besides, any time our vote would authorize a new state commission with the word "integrity" embedded in its name (as in, "Gaming Integrity Commission"), well, I'm thinking maybe the joke would be on us. We could keep taking inventory of specific objections to Issue 3, but that skips over what to my mind is one of the weirder aspects of Learn & Earn, namely: How long do people have to sit around drinking at some bar before they can convince themselves that slot-machine gambling equals the future of Ohio college students? Are we not in The Twilight Zone when we think it makes any sense whatsoever to use higher education as a pitch for voters to approve gambling? I try and try to envision how this came about, but all I can conjure up are conversations between Rod Serling and his doppelganger. "Man, I sure would like to see Ohio get a slice of those gambling dollars, Rod!"
"Boy, Rod, so would I! Wonder how we can do it?"
"Hey, Rod, I've got it! Let's make slot machines a constitutional amendment! But, gosh, how could can we sell it to voters?"
"Oooh, oooh, I know! We'll tell 'em it's 'for the children' - that one works every time, Rod!"
The premise of Issue 3 is so absurdly specious that, were I the bartender on the night Rod & Himself stopped in, I'd have cut them off long before they reached that conclusion.
Alas, no one did.
If you go to the Issue 3 proponents' Web site and read "About Ohio Learn & Earn," you have to plod through five whole paragraphs and 137 words before reaching that section's first mention of slot machines.
It's true that Ohio gets an "F" for college affordability.
Sinajana leaders snub Prop "B", but allow gambling at village fiesta
Some would agree that certain types of gambling activities on Guam is part of the local culture. Also, during village fiestas gambling activities are allowed, but has to go through an approval process, just like this weekend's Sinajana fiesta. But what some may find sort of ironic is that the vice-mayor of the central island village is part of the group that is in opposition of Proposal "B", the initiative to allow the use of slot machines at the Guam Greyhound Raceway Park. The Municipal Planning Council granted approval for Sinajana to set up certain types of gambling activities, cockfighting and card games during this weekend's fiesta. But what may be viewed as ironic is that the village Vice-Mayor Robert Hoffman is also a member of a group that is in opposition of Prop "B", the initiative that allows slot machines. "I can understand why it would seem it's almost ironic," he admitted. "The difference is that the proposal and the gambling that exists here? There are so many different factors. The ones who are running it here are Sinajana people. "I had a great big debate with the Municipal Planning Council to understand this side and that side and saying that difference is 'this one is a weekend, a few hours', like a family get together and decided to sit down and play cards, gambling, we'll sit down and play 21. I know that there is an entertainment portion of it and gambling side to it, but my biggest objection to Prop "B" is the way its written, so many unanswered things." Sinajana mayor Roque Blas confirmed that he doesn't support Prop "B". But if Hoffmann and Blas are against the initiative, and since they are sort of in a position of village authority with what takes place in Sinajana, wouldn't they have some say of what may or may not take place in the village? "Can we say no? We have a Municipal Planning Council that does that," Hoffmann said. "We meet with them regularly and it's them who really decide that. It's not just a council made up of Catholics, or people who are pro or anti anything so it really gives us a really broad objective view."
Mayor Blas added, "It's a little bit beyond my control. Because this has always been one of the culture things that eventually, I guess, if it ever comes to an initiative then it can stop."
While Hofmann and Blas feel that gambling activities during fiestas and Proposal "B" are completely different animals, both venues are expected to benefit the community. Said the mayor, "We take some of that and we give it towards the kids to even host their games and even towards their uniforms for any kind of sports activities that they get involved into which takes some of that cost off of our government coffers because our funding is very limited right now."
Getting in position to win a Nextel Cup Series championship hasn't been a problem for Jimmie Johnson. Sealing the deal, on the other hand, that's a whole other matter. Since coming into the series as a rookie in 2002, Johnson has finished the season in the top five in the point standings every year. Two times he finished series runner-up, including a scant eight points behind Kurt Busch in the inaugural Chase for the Championship in 2004. "Looking back at the past few seasons of the chase, we felt we maybe gambled at the wrong time and tried to develop parts and pieces for the car and set-ups at the wrong times," Johnson said. "This year I really think we really stuck to a good plan and developed our stuff at the right time." Johnson's team has the appearance of a fighter exploding out of the corner after getting knocked down with a few left hooks in the first two rounds. After a few bumps in the road early in The Chase, Johnson is back in position to win a title, 41 points behind leader Matt Kenseth with four races left, including Sunday's Bass Pro Shops 500 at Atlanta Motor Speedway. "Obviously, with the slow start we had, I'm happy about it," Johnson said. "We've been knocking on the door for a championship for five seasons, and hopefully, this will be the year for us." Johnson will start Sunday's Bass Pro Shops 500 in third place after rain washed out all of Friday's on-track activity. The field will line up by points, putting Matt Kenseth and the rest of The Chase field out front for Sunday's race. Today's on-track action calls for two Nextel Cup practice sessions, the Crown Royal International Race of Champions season finale, and the NASCAR Craftsman Truck Series Easy Car Vehicle Service Contacts 200. The weather forecast for today is favorable with partly cloudy skies and little chance of rain. Getting in place to win a title hasn't come easy for Johnson, who entered The Chase in second place. After damage dropped him to a 39th-place finish in New Hampshire to start the Chase Johnson found himself in ninth place, well below his accustomed position of no worse than third up until the start of The Chase.
After a finish of 13th at Dover improved him to eighth, a chance for a big points day vanished two weeks later at Talladega where last lap contact between he, Dale Earnhardt Jr. and Hendrick Motorsports teammate Brian Vickers sent Johnson to a finish of 24th.
Since then, the No. 48 team has caught fire similar to the early-season fashion when it won two of the first three races to start the year. A finish of second at Lowe's Motor Speedway followed by last week's win at Martinsville moved Johnson up to third in the standings.
"The luck and the way things have gone have really made this an interesting and crazy chase for all the competitors," Johnson said. "We made good changes we're we need to be. We were let back into this deal in a weird way and it's time to go."
At Lowe's, Johnson was beat to the finish line by Kasey Kahne. Kahne's eighth in The Chase for the Championship, 99 points out of first place. Before the Nextel Cup trophy is hoisted in Homestead, Kahne expects Johnson to have a say in who the champion will be.
"He's right there. He can definitely come in and take away," Kahne said. "At Charlotte we won just off of having a better racecar. He started out with the lead after the final stop and I passed him and drove away."
Johnson getting back into the heat of The Chase couldn't come at a better time for he and his team. He ranks fourth among active Nextel Cup drivers with an average finish of 11.8 at AMS and won the Bass Pro Shops 400 two years ago.
Atlanta's 1.54-mile quad-oval configuration is very similar to Lowe's Motor Speedway and the next track on the schedule, Texas Motor Speedway. Johnson's won five points races at Lowe's in addition to a pair of Nextel All-Star Challenges.
I don't gamble online. I've seen too many of my friends get so addicted to poker that they've got no time left for Internet porn. And I'm not going to let that happen to me. But I didn't expect Congress to pass the Unlawful Internet Gambling Enforcement Act, treating people who spend all day at partypoker.com like criminals. Maybe I'm a traditionalist, but I think of criminals as people who I can't beat up and who do math slower than I do. It breaks my heart when the greed our nation is famous for gets trumped by the religious posturing we were founded on. It's a horrible conundrum. Either we give up the tax receipts on the US$6 billion that Americans spend gambling online, or we let people do whatever they want with their own money. It's like making Poland choose between scowling and yelling. So we've decided to forfeit all that income -- almost enough to let us invade a very small Middle Eastern country, or at least an emirate -- to foreign governments. Within 10 years, all the world's great bridges to nowhere will be on the Isle of Man. It's kind of sweet that our government wants to protect us from ourselves. It's like it loves us. It has made it clear that it wants us to stay away from drugs, gambling, prostitutes and Janet Jackson, all of which it is right about. And I recognize that the Internet is a particular danger because it makes sin too easy. How can our economy grow when the machine you work on all day also lets you gamble, buy OxyContin and watch porn? If moving your factory lever up built a car engine, and moving it down let you see Little Egypt dance the hootchy-kootchy, we'd be driving like Fred Flintstone. There's a great sense of American optimism in all this lawmaking. Sure, prohibition didn't work, and the drug laws have no effect, but, darn it, we really believe that we're going to stop the 23 million Americans who waste their money gambling online. The cutest part is that Congress doesn't see the irony in telling people not to waste their money. But, of course, capitalism always sneaks its way into morality. Because of strong lobbies, the new law makes an exception, allowing Web sites for lotteries and horse racing. Because, as anyone who's been to a 7-Eleven or an OTB place knows, it's online poker that sets back the poor. Imagine the economic success Appalachia would be if not for PlayBaccarat.com.
At a time when giving up free tax revenue seems particularly insane, the Senate was smart enough to bury the new law in a bill aimed at enhancing port security. Senators didn't see the irony of linking legislation that takes away some of our freedoms with legislation about protecting our remaining freedoms from terrorist attack.
Legislating vice never works, mostly because vice is a lot of fun. The laws wind up being weakened by so many inconsistencies -- you can gamble on a boat permanently docked a few feet off the riverbank as long as it pretends to sail every 15 minutes; you can drink in public as long as it's covered by a brown bag; you can't clone stem cells but you can clone Kelly LeBrock -- they make us lose respect for the law in general.
So, as more people gamble online, the government will eventually have to find a way to back down without looking stupid. The obvious solution is to borrow the Indian casino reparations idea and allow gambling sites to be run by released Guantanamo Bay prisoners. Not only would the profits erase any bad feelings, the former detainees would be great at running poker sites. After all, four years of water-boarding is the perfect training for having to listen to endless stories about bad beats.
Alcohol board rebukes bars with gambling violations
Bar owners heard the message over and over at recent liquor license renewal hearings: Gambling violations will not be tolerated by members of the St. Joseph County board of the state Alcohol and Tobacco Commission. Neither will multiple violations. The local board did not deny any permit renewals Wednesday, but board President Mike Pajakowski and Secretary Curtis Woolley issued stern warnings. A laundry list of violations, including ones for a gambling machine and other gambling materials, brought Grant Jones of Moondog's Pub North, 1516 N. Ironwood Drive, before the board. Woolley told Grant that a list of violations like those before him makes him wonder if the bar is operated like the "Wild West." "It's a slap in the face to all the establishments who abide by the laws and to the board members who granted you the privilege" of being able to do business, Woolley said. Jones assured the board there is no more gambling equipment or violations. "We learned our lesson the first time." Pajakowski said if there were any other violations, the bar's alcohol permit could be in jeopardy of not being renewed. An officer in the corporation that owns Jeannie's tavern, 621 S. Bendix Ave., had to explain to the board why his club lost three gambling machines and $400 that was seized in November by excise police. Don Larson, one of the bar's owners, said without the extra revenue, it is harder to make ends meet at the bar. The board also admonished Carl Blount of Clay Pub, 52170 Indiana 933, for failing to attend an earlier hearing to respond to a violation for having pull tabs, an illegal gambling activity.As Blount was laughing off the situation, Pajakowski told him sternly to "pay attention." Blount's license expired Oct. 19 so he was told he would need to get a letter of extension from the state to purchase alcohol from his supplier. D.L. Austin of Starz bar, 1505 S. Kendall St., won his license renewal after a two-month delay.
His prior violations included one for an unplugged gambling machine he had purchased as a present for his mother's 75th birthday and stored in the bar. She came to the board and verified that Wednesday.After Pajakowski warned its owner about a gambling violation, the board renewed the liquor license for MB's Sports Bar & Lounge, 1004 Roosevelt Road, Walkerton.
The liquor license of the American Legion Post 284 at 23571 Grant Road, was renewed by the board after being remanded from the state commission.
The local board had turned down the renewal when no one from the post appeared for two hearings required because of a gambling violation.
Gamblers may look over their shoulder now, but experts say a new Internet-gambling ban won't keep bettors from ponying up, just turn them on to overseas payment services out of the law's reach. "It has put a terrible scare into people," said I. Nelson Rose, who teaches gambling law at Whittier Law School. "But it won't by any means wipe out Internet gambling." The fright swept through the $12 billion industry on the heels of the recent arrests of two gambling company executives and a new law President Bush signed Oct. 13 that seeks to ban most online gambling and criminalizes funds transfers. The law has wiped out billions of dollars in shareholder value of British companies, leaving the industry's future in doubt as U.S. lawmakers initially celebrated finding a way to halt bets coming from America. But serious questions remain about whether the legislation can be effective in stopping U.S. residents from playing poker or betting on sports. The Unlawful Internet Gambling Enforcement Act goes after the money, not the millions of players, which would be nearly impossible to enforce. It will essentially try to choke off the way Americans fund their gambling habits, hoping to prevent the transfer of dollars to the popular Internet sites. It's also widely understood that the law has online poker in its sights, identifying it as a game of chance - something the poker companies dispute. They believe poker is a game of skill and therefore not subject to the new rules. But they're fearful nonetheless. "Their mission is to kill the funding of online poker, and that's what this law does," said Mike Sexton, who hosts the popular World Poker Tour and has won millions as a professional player. 2,000 gambling sites The new law comes amid an explosion in online gambling, fueled by the Texas Hold 'em craze and widespread access to the Internet. In addition, dozens of Web sites have sprouted up that allow gamblers with credit cards to bet on any sport they choose, for any amount of money they want.
Industry experts say there are an estimated 2,000 Internet sites that take bets for sports and poker. American players have fueled Internet gambling, supplying $6 billion of the $12 billion in revenues generated annually.
"The time has been one of rapid growth," said Sebastian Sinclair, president of Christiansen Capital Advisors, a gambling consultant. "This industry was well on its way to becoming mainstream in a great part of the world. Capital was tripping over itself to fund these companies."
The new law gives the U.S. Treasury and the Federal Reserve, along with the attorney general, 270 days to establish policies and procedures.
"The regulations are clearly going to prevent banks from doing electronic fund transfers to gambling sites, but that is no big deal," Rose said. In some cases, banks simply move the money to payment processors, known as e-wallets. Non-U.S. payment processors such as the widely used Neteller then transfer the money to the Internet gambling sites.
The U.S. government has no authority over processors like Neteller that are operating legally. Anthony Cabot, a gambling lawyer in Las Vegas, thinks language used in the bill provides a loophole for the payment processors and the U.S. banks that want to do business with them.
"Unless you have some fairly draconian measures ... the likelihood of stopping payment to them is small," Cabot said.
Offshore betting targeted Much damage has already been done to the offshore sports-betting industry without the looming regulations. British BetOnSports PLC folded after its chief executive was arrested in July by U.S. authorities. David Carruthers faces 22 counts of fraud and racketeering charges and remains under house arrest in the St. Louis area.
London-based Sportingbet's chairman was detained last month in New York on a state fugitive warrant charging him with illegal online gambling. He was eventually freed.
Both arrests sounded serious alarm bells for those running sports wagering sites that take American bets.
The new legislation has already had a dramatic effect. It supposedly clarifies the 1961 Wire Act, explicitly outlawing Internet gambling, including online poker. It creates new criminal penalties that have rattled investors and executives - although Rose said it doesn't expand the act, and there's no indication the Justice Department is about to launch a huge campaign to enforce the law.
Still, the biggest publicly traded names in Internet gambling on the London Stock Exchange and AIM, the exchange's global market for growing companies, could not afford to flout American law. When news broke earlier this month that Congress has passed the bill, Internet-gambling companies traded on those exchanges lost a combined $7 billion in market capitalization.
PartyGaming PLC, once the envy of online gambling with its more than $8 billion IPO in 2005, is now trying to figure out how to save its business model. It runs what was once the world's biggest poker site, PartyPoker, and has said it will no longer take payments from the U.S., eliminating nearly 80 percent of its revenue and sending its stock plunging.
Another poker company, 888 Holdings PLC, also said it would stop taking U.S. bets, ensuring its profits will fall dramatically. Sportingbet and Leisure & Gaming both sold their U.S. operations for a dollar. Sportingbet said its exit from the U.S. market cost it nearly $400 million.
Here in THE U.S., it's OK to bet on horses, play Lotto, gamble at Indian casinos, wager in Atlantic City. And in Las Vegas, it's virtually a patriotic duty to gamble. In all, you can legally bet in 46 of 50 states, but not over the Internet. Online gambling is illegal. Although the online side of the business, while still small, is booming, Las Vegas casinos have hardly clamored for its legalization. That's partly because they figure that whenever folks develop a taste for gambling, they will sooner or later look to Vegas to satisfy their hunger. If the distinction between gambling online and offline strikes you as hypocritical, you're not alone. In November 2004, the World Trade Organization ruled that the United States was in violation of international law by making it a crime for Americans to place bets with online bookies parked offshore. Its court agreed with the tiny island nation of Antigua that, with legal gambling so prevalent in the U.S., laws barring gambling online with offshore casinos was protectionist and, therefore, a violation of international treaties. Antigua's economy, because it depends on Internet casinos, was unduly harmed. Since then, the case has bogged down in post-judgment proceedings to determine the extent of U.S. compliance with the ruling, which the U.S. can still appeal. Aggravating the situation, however, American officials have stepped up enforcement of existing laws, and Congress passed legislation putting more obstacles in the way of online bettors. This summer, federal and state officials arrested two British executives, David Carruthers, chief executive of BetonSports, and Peter Dicks, chairman of Sportingbet, when they touched down in the U.S. to change planes. Although Carruthers' and Dicks' businesses are lawful in their home countries, federal prosectors indicted Carruthers and BetonSports for taking wagers from U.S. residents. Dicks' gambling activities offended the sensibilities of Louisiana law.
Following the arrests, Congress passed the Unlawful Internet Gambling Enforcement Act of 2006. Although the new law doesn't make Internet casinos or bookies illegal (they already are), it bars banks and credit card companies from facilitating the transfer of funds to online casinos.
The actions have prompted some online casinos to announce that they will no longer accept bets from U.S. residents. Although there is some uncertainty about how the new law will work or how easily it might be evaded, shares of online casino companies, which are heavily dependent on U.S. wagers, dropped by as much as 58% on the London Stock Exchange.
Because Congress hasn't moved to shut down other gambling opportunities in the U.S., attacks on Internet gambling amount to little more than favoring vice that enriches bookmakers at home.
Casinos in the U.S. traditionally have "fundamentally opposed" online gambling, said Holly Thomsen, spokeswoman for the American Gaming Assn., the casino industry's lobbying arm. Without "proper regulations," she asked, who would protect the children or the "problem gamblers"?
In April, however, the industry group adopted a more neutral stance, saying the issue deserves further study, which was perhaps not a coincidence, because MGM Mirage and Harrah's, both members of the American Gaming Assn., now say they would like a piece of the action if it were legal.
Online gambling remains a tiny slice of the gaming pie. The gross wagers - amount bet minus winnings - on legal gambling in the U.S. was $83.7 billion in 2005, up $4.8 billion, or 6.1%, from 2004, according to Christiansen Capital Advisors, which tracks the numbers. By contrast, online gambling's gross revenue was $5.9 billion worldwide, just 7% of the U.S. total, despite a 42.2% rise from the year before.
All told, the online gaming revenues were just 27% of those of Indian casinos and one-quarter of those enjoyed by state lotteries. But, of course, these amounts probably would explode if online betting in the U.S. were legal and properly regulated. As it is, a 2005 survey commissioned by the American Gaming Assn. revealed that 4% of Americans gamble online, but 38% of them said they started last year, and 70% of them reported that they began betting online in the last two years.
Given such growth, the online share of the gaming market probably will increase unless law enforcement becomes more effective than anyone imagines.
U.S.-based casino companies have traditionally soft-pedaled their interest in online gaming, it being illegal and all that. But at least some casinos would rather participate than see the entire business outlawed.
The casinos say their interest in betting via modem is not because they fear the competition. Many have wrongly predicted the demise of Las Vegas because venues for legal gambling - riverboats, lotteries, Indian casinos - have expanded, said Robert LaFleur, gaming analyst with Susquehanna Financial Group. But over the years, the conventional wisdom has become "the more gamblers, the merrier," because they'll wind up eventually in Las Vegas. "Anything that creates more gamblers is good for brick-and-mortar casinos," said Dennis Forst, an analyst for Keybanc Capital Markets.
If online gambling is ever legalized here, the big casino companies would get into the business and no doubt dominate it with their trusted brands and their deep-pocketed marketing budgets. Would you rather make a bet with some crew in the Caribbean, or with Caesars Palace, which you might also visit from time to time? The American Gaming Assn. survey indicated that 67% of online gamblers visited a casino in the last 12 months.
Two days after the National Coalition Against Legalized Gambling Regional Conference occurred here, I saw Seneca Nation President Barry Snyder, Mayor Byron Brown and Seneca Gaming Corp. officials on public access TV replaying the Fulton Street sale approval announcement and predicting "development, waterfront connectedness, millions of tourists" and other such misleading sound bites. This offensive and private press staging did not present any opposing views or facts. No public input was offered or allowed. There was no citizen representation. This came as a result of surreptitious, behind-closed-door sham "negotiations" over the last two months that overlooked fact, economic research and obvious outcome in other communities. By contrast, the educational, open NCALG conference provided solid economic analysis by experts and research founded on realities. It has been clearly shown that urban casinos cause harm far in excess of any help to the city. Again, look at Detroit, Niagara Falls, New York, Louisiana, Turning Stone or the big casinos in Connecticut - all true losers for these communities. Please understand that there is real human tragedy for individuals and families being created in these "entertainment" palaces. Adult gamblers are modeling the risk of future misery for their children. Buffalo Creek (which will hopefully never open) in legal documents wrote its stated intention is to bring in the local population, but now claims "in writing" that it cares about promoting itself to the region. The Senecas and Brown have no data, no facts and no proof to support the future benefit to Buffalo. The first year's $125 million will go to the building trades - Brown's allies - and yearly thereafter $150 million or more will leave the economy and bring in a zero-development Niagara-Falls type scene, good only for the Senecas and gambling industry supporters.
For every dollar generated, $3 will be lost and $12 million to $16 million in taxes will belong to the sovereign nation, not the city. Five million dollars for the city from the slot cut is 50 percent less than revenue from parking enforcement as projected in the 2006-07 budget.
Is anyone in City Hall doing the math or checking the facts? Not one city official came to the gambling conference. The National Gambling Impact Study Commission stated that as the money is lost faster, the socioeconomic negatives increase dramatically. Its final report confirmed that the gambling industry had created new addicted gamblers, new bankruptcies and new crime and corruption. The 1999 U.S. Gambling Commission unanimously called for a moratorium on the expansion of U.S. gambling. Sadly, however, it has grown into a monster.
Anyone with sense can see the harm coming to Buffalo. Jobs will be lost, restaurants closed, families devastated, bankruptcies and crime increased. The casino is a strategy for injustice, not economic development.
Here in THE U.S., it's OK to bet on horses, play Lotto, gamble at Indian casinos, wager in Atlantic City. And in Las Vegas, it's virtually a patriotic duty to gamble. In all, you can legally bet in 46 of 50 states, but not over the Internet. Online gambling is illegal. Although the online side of the business, while still small, is booming, Las Vegas casinos have hardly clamored for its legalization. That's partly because they figure that whenever folks develop a taste for gambling, they will sooner or later look to Vegas to satisfy their hunger. If the distinction between gambling online and offline strikes you as hypocritical, you're not alone. In November 2004, the World Trade Organization ruled that the United States was in violation of international law by making it a crime for Americans to place bets with online bookies parked offshore. Its court agreed with the tiny island nation of Antigua that, with legal gambling so prevalent in the U.S., laws barring gambling online with offshore casinos was protectionist and, therefore, a violation of international treaties. Antigua's economy, because it depends on Internet casinos, was unduly harmed. Since then, the case has bogged down in post-judgment proceedings to determine the extent of U.S. compliance with the ruling, which the U.S. can still appeal. Aggravating the situation, however, American officials have stepped up enforcement of existing laws, and Congress passed legislation putting more obstacles in the way of online bettors. This summer, federal and state officials arrested two British executives, David Carruthers, chief executive of BetonSports, and Peter Dicks, chairman of Sportingbet, when they touched down in the U.S. to change planes. Although Carruthers' and Dicks' businesses are lawful in their home countries, federal prosectors indicted Carruthers and BetonSports for taking wagers from U.S. residents. Dicks' gambling activities offended the sensibilities of Louisiana law.
Following the arrests, Congress passed the Unlawful Internet Gambling Enforcement Act of 2006. Although the new law doesn't make Internet casinos or bookies illegal (they already are), it bars banks and credit card companies from facilitating the transfer of funds to online casinos.
The actions have prompted some online casinos to announce that they will no longer accept bets from U.S. residents. Although there is some uncertainty about how the new law will work or how easily it might be evaded, shares of online casino companies, which are heavily dependent on U.S. wagers, dropped by as much as 58% on the London Stock Exchange.
Because Congress hasn't moved to shut down other gambling opportunities in the U.S., attacks on Internet gambling amount to little more than favoring vice that enriches bookmakers at home.
Casinos in the U.S. traditionally have "fundamentally opposed" online gambling, said Holly Thomsen, spokeswoman for the American Gaming Assn., the casino industry's lobbying arm. Without "proper regulations," she asked, who would protect the children or the "problem gamblers"?
In April, however, the industry group adopted a more neutral stance, saying the issue deserves further study, which was perhaps not a coincidence, because MGM Mirage and Harrah's, both members of the American Gaming Assn., now say they would like a piece of the action if it were legal.
Online gambling remains a tiny slice of the gaming pie. The gross wagers - amount bet minus winnings - on legal gambling in the U.S. was $83.7 billion in 2005, up $4.8 billion, or 6.1%, from 2004, according to Christiansen Capital Advisors, which tracks the numbers. By contrast, online gambling's gross revenue was $5.9 billion worldwide, just 7% of the U.S. total, despite a 42.2% rise from the year before.
All told, the online gaming revenues were just 27% of those of Indian casinos and one-quarter of those enjoyed by state lotteries. But, of course, these amounts probably would explode if online betting in the U.S. were legal and properly regulated. As it is, a 2005 survey commissioned by the American Gaming Assn. revealed that 4% of Americans gamble online, but 38% of them said they started last year, and 70% of them reported that they began betting online in the last two years.
Given such growth, the online share of the gaming market probably will increase unless law enforcement becomes more effective than anyone imagines.
U.S.-based casino companies have traditionally soft-pedaled their interest in online gaming, it being illegal and all that. But at least some casinos would rather participate than see the entire business outlawed.
The casinos say their interest in betting via modem is not because they fear the competition. Many have wrongly predicted the demise of Las Vegas because venues for legal gambling - riverboats, lotteries, Indian casinos - have expanded, said Robert LaFleur, gaming analyst with Susquehanna Financial Group. But over the years, the conventional wisdom has become "the more gamblers, the merrier," because they'll wind up eventually in Las Vegas. "Anything that creates more gamblers is good for brick-and-mortar casinos," said Dennis Forst, an analyst for Keybanc Capital Markets.
If online gambling is ever legalized here, the big casino companies would get into the business and no doubt dominate it with their trusted brands and their deep-pocketed marketing budgets. Would you rather make a bet with some crew in the Caribbean, or with Caesars Palace, which you might also visit from time to time? The American Gaming Assn. survey indicated that 67% of online gamblers visited a casino in the last 12 months.
THE biggest bets in Las Vegas take place behind closed doors. In the private high-rollers' suites, punters bet $1m a hand on blackjack while sipping $5,000-a- bottle cognac. This month the biggest bet in town is being made away from the slot machines and roulette wheels. It is being placed on the boardroom table, not the card table; and the prize is in Britain. What happens in Vegas is supposed to stay in Vegas; but Chuck Atwood is betting £300m that his firm, Harrah's Entertainment Inc, the world's biggest casino operator, can bring a bit of Sin City to the UK. Atwood, vice-chairman of Harrah's, predicts that its 135p-a-share bid for London Clubs International (LCI), which operates seven casinos in Britain and is opening five more, will "close within a month". Harrah's already controls 34% of LCI after the biggest shareholder, Genting International, the Malaysian gambling group, agreed to sell its 30% stake to the Las Vegas firm last week. Atwood expects the other LCI shareholders to follow suit in a matter of weeks. He knows the bid will make him a hate figure among critics who waged a furious campaign against the government's 2005 Gambling Act, which will unwind the strict rules that have governed gaming in Britain for 40 years when it comes into force next year. Atwood gave an assurance that Harrah's was "responsible and respectable". Giving his first interview to a British newspaper, he said that in gambling "as in almost every activity that human beings engage in, some people do it to excess". But "there is no evidence that gaming is predatory". He added: "The evidence is that casinos provide a very rich entertainment option. They don't prey on people. They offer fulfilling entertainment. There is no horrible social result. The social result is people get jobs. That is a good outcome. We are a quality operator." The public campaign against the gambling act forced ministers to abandon plans for almost a dozen super-casinos and opt instead for one super-casino, eight large casinos and eight small ones. Despite this, Atwood, 58, believes Britain is the ideal new market for gambling firms.
"Britons gamble on everything," he said. "Gambling is probably more widely available (there) than anywhere else in the world. Walk down any high street and there are betting shops. You can gamble on the internet too.
"Brits gamble but they don't gamble in casinos. One reason is that there is not much to do in British casinos other than gamble. We want to change that by creating a nicer and grander experience."
Harrah's £300m bid for LCI is high. It was recently valued at only £230m, and last year it made a £3.6m pre-tax loss. "There are those who believe that we are being foolish, but we see value. We think it could grow by leaps and bounds," Atwood said.
By combining Britons' appetite for gambling with Harrah's casino expertise - it controls the Caesars Palace, Paris and Flamingo casinos on the Las Vegas Strip - Atwood believes he can expand the British market fivefold. "About 3% of people in Britain frequent casinos. I can see that growing to 10% or 15%."
Harrah's wants to export the style and success of modern Vegas casinos to Britain. In recent years the big operators, notably Harrah's and its arch- rival MGM Mirage, have used top acts, celebrity chefs, luxury-goods brands and spas to turn their casinos into upmarket international resorts.
Outside the sandstone walls of Atwood's office at Caesars Palace, Sir Elton John and Celine Dion fill the 4,000-seat Colosseum theatre; shoppers browse the latest Dolce & Gabbana and Gucci collections in the Forum mall; and foodies sit down to a £200-a-head dinner prepared by three-Michelin-star chef. The big casinos now generate more than half their annual revenue from non-gambling sources.
Harrah's wants to add new, Vegas-style entertainment to LCI's existing seven casinos in Britain and its five planned new casinos in London, Nottingham, Glasgow, Leeds and Blackpool. It will also bid for licences to operate the 17 new casinos allowed under the gambling act.
"As well as gambling, our plan is for an auditorium purpose-built for a signature show, top-name chefs and branded stores. We believe that we will offer such a good night out or weekend away that people will come whether they are gamblers or not," said Atwood.
The firm plans to advertise and use direct marketing for the first time in the British casino market. Ads are allowed under the new gambling act, which also allows bigger casinos, unrestricted membership, larger jackpots, more slot machines and liberalised licensing hours.
Harrah's wants to exploit its popular American Total Rewards loyalty programme to attract visitors. The scheme - a Tesco Clubcard-style rewards-for-points programme - tracks customers' gambling and spending and allows Harrah's to come up with tailor-made special offers. The firm plans to use the card to offer gamblers discounted trips to its British and Las Vegas casinos. Executives are rumoured to be in talks with Virgin Atlantic and BMI - the only airlines to fly direct from Britain to Las Vegas - to offer gamblers discounted flights.
Harrah's executives were privately furious when British ministers watered down their deregulation plans. Although the first battle to liberalise fully was lost, Atwood insists the war is far from over. He predicts that, if Harrah's UK investment creates jobs in depressed areas, pressure for more and larger casinos will grow.
"We did not get our first bite. We got our second bite. But the first bite might still be available," he said.
Harrah's may be the first Las Vegas gambling giant to invest in Britain but it is not the only foreign operator moving in. Genting is set to open larger casinos with entertainment and will compete with Harrah's for licences to run the 17 new casinos. MGM Mirage, which controls the MGM Grand, Mandalay Bay, Bellagio and Mirage casinos in Las Vegas, is also eyeing up opportunities in Britain.
For Harrah's, the stakes are higher than simply becoming a lead player in Britain. The LCI deal is the key to an ambitious expansion strategy. "We see London Clubs helping us to expand on the continent and beyond. London will be our European hub," said Atwood.
LCI already owns two casinos in Egypt and one in South Africa, and it acts as a consultant to a casino in Lebanon. Harrah's will retain all LCI's overseas operations and open new casinos. It is working independently on a casino south of Madrid and another in Slovenia.
Britain's culture secretary on Friday compared the United States crackdown on online gambling to the failed alcohol ban of the Prohibition as she prepared to host an international summit on Internet gambling next week. Tessa Jowell warned that the U.S. ban on Internet gambling would make unregulated offshore sites the "modern equivalent of speakeasies," illegal bars that opened in 1920s America when alcohol was banned. U.S. Congress caught the gambling industry by surprise earlier this month when it added to an unrelated bill a provision that would make it illegal for banks and credit-card companies to settle payments for online gambling sites. The decision closed off the most lucrative region in a market worth $15.5 billion this year in "spend" value - the amount gambling companies win from their clients, or the amount gamblers lose. Several London-based Internet gambling companies and a handful in Europe and Australia subsequently sold off or shut down their U.S. operations, losing around 80 per cent of their combined business in the process. U.S. officials have declined to participate in Tuesday's gambling summit in London, where lawmakers from 30 countries will discuss ways to regulate the industry, including the protection of minors and keeping the industry free of crime.
An alleged maintainer of an illegal gambling outfit codenamed "Ching", who is a relative of top government officials in Negros Occidental, was sentenced yesterday to a maximum six-year imprisonment term after he pleaded guilty for violating Republic Act 9287, also known as the amended anti-illegal gambling law. Meted such penalty by Kabankalan Regional Trial Court Judge Henry Arles after having been found guilty beyond reasonable doubt was Vicente Zayco, alias Nene Pinoy. Arles also sentenced Zayco's four companions identified as Renato Garcia, Gene Gomez, Val Sanchez and Randy Jompilla, all bet solicitors of the illegal gambling outfit "Ching", to a maximum of three years of imprisonment. The Oct. 20 raid at the residential compound of Zayco, a first cousin of Vice Governor Isidro Zayco and Kabankalan City Mayor Pedro Zayco, was conducted by virtue of search warrants issued by Judge Roberto Chiongson. It yielded P2,553 in alleged cash bets, assorted gambling paraphernalia, ammunition of various calibers of firearms and an ICOM hand-held radio. Arles said the accused, assisted by their counsel, Alex Abastillas, pleaded guilty to the offense, which was done voluntary on their part, and not through threats or intimidation, induced by any prize or reward. Vice Governor Zayco and Mayor Zayco earlier said they are keeping their hands off the illegal gambling case involving their cousin. Mayor Zayco who is against any form of illegal numbers game, had also warned Vicente several times in the past to put a stop to his illegal activities. Supt. Roderick Alba, Kabankalan police chief, said the court also issued an order placing the convicted persons under the custody of their counsel, pending approval of their application for probation.
Gamblers may look over their shoulder now, but experts say a new Internet-gambling ban won't keep bettors from ponying up, just turn them on to overseas payment services out of the law's reach. "It has put a terrible scare into people," said I. Nelson Rose, who teaches gambling law at Whittier Law School. "But it won't by any means wipe out Internet gambling." The fright swept through the $12 billion industry on the heels of the recent arrests of two gambling company executives and a new law President Bush signed Oct. 13 that seeks to ban most online gambling and criminalizes funds transfers. The law has wiped out billions of dollars in shareholder value of British companies, leaving the industry's future in doubt as U.S. lawmakers initially celebrated finding a way to halt bets coming from America. But serious questions remain about whether the legislation can be effective in stopping U.S. residents from playing poker or betting on sports. The Unlawful Internet Gambling Enforcement Act goes after the money, not the millions of players, which would be nearly impossible to enforce. It will essentially try to choke off the way Americans fund their gambling habits, hoping to prevent the transfer of dollars to the popular Internet sites. It's also widely understood that the law has online poker in its sights, identifying it as a game of chance - something the poker companies dispute. They believe poker is a game of skill and therefore not subject to the new rules. But they're fearful nonetheless. "Their mission is to kill the funding of online poker, and that's what this law does," said Mike Sexton, who hosts the popular World Poker Tour and has won millions as a professional player. 2,000 gambling sites The new law comes amid an explosion in online gambling, fueled by the Texas Hold 'em craze and widespread access to the Internet. In addition, dozens of Web sites have sprouted up that allow gamblers with credit cards to bet on any sport they choose, for any amount of money they want.
Industry experts say there are an estimated 2,000 Internet sites that take bets for sports and poker. American players have fueled Internet gambling, supplying $6 billion of the $12 billion in revenues generated annually.
"The time has been one of rapid growth," said Sebastian Sinclair, president of Christiansen Capital Advisors, a gambling consultant. "This industry was well on its way to becoming mainstream in a great part of the world. Capital was tripping over itself to fund these companies."
The new law gives the U.S. Treasury and the Federal Reserve, along with the attorney general, 270 days to establish policies and procedures.
"The regulations are clearly going to prevent banks from doing electronic fund transfers to gambling sites, but that is no big deal," Rose said. In some cases, banks simply move the money to payment processors, known as e-wallets. Non-U.S. payment processors such as the widely used Neteller then transfer the money to the Internet gambling sites.
The U.S. government has no authority over processors like Neteller that are operating legally. Anthony Cabot, a gambling lawyer in Las Vegas, thinks language used in the bill provides a loophole for the payment processors and the U.S. banks that want to do business with them.
"Unless you have some fairly draconian measures ... the likelihood of stopping payment to them is small," Cabot said.
Offshore betting targeted Much damage has already been done to the offshore sports-betting industry without the looming regulations. British BetOnSports PLC folded after its chief executive was arrested in July by U.S. authorities. David Carruthers faces 22 counts of fraud and racketeering charges and remains under house arrest in the St. Louis area.
London-based Sportingbet's chairman was detained last month in New York on a state fugitive warrant charging him with illegal online gambling. He was eventually freed.
Both arrests sounded serious alarm bells for those running sports wagering sites that take American bets.
The new legislation has already had a dramatic effect. It supposedly clarifies the 1961 Wire Act, explicitly outlawing Internet gambling, including online poker. It creates new criminal penalties that have rattled investors and executives - although Rose said it doesn't expand the act, and there's no indication the Justice Department is about to launch a huge campaign to enforce the law.
Still, the biggest publicly traded names in Internet gambling on the London Stock Exchange and AIM, the exchange's global market for growing companies, could not afford to flout American law. When news broke earlier this month that Congress has passed the bill, Internet-gambling companies traded on those exchanges lost a combined $7 billion in market capitalization.
PartyGaming PLC, once the envy of online gambling with its more than $8 billion IPO in 2005, is now trying to figure out how to save its business model. It runs what was once the world's biggest poker site, PartyPoker, and has said it will no longer take payments from the U.S., eliminating nearly 80 percent of its revenue and sending its stock plunging.
Another poker company, 888 Holdings PLC, also said it would stop taking U.S. bets, ensuring its profits will fall dramatically. Sportingbet and Leisure & Gaming both sold their U.S. operations for a dollar. Sportingbet said its exit from the U.S. market cost it nearly $400 million.
Two days after the National Coalition Against Legalized Gambling Regional Conference occurred here, I saw Seneca Nation President Barry Snyder, Mayor Byron Brown and Seneca Gaming Corp. officials on public access TV replaying the Fulton Street sale approval announcement and predicting "development, waterfront connectedness, millions of tourists" and other such misleading sound bites. This offensive and private press staging did not present any opposing views or facts. No public input was offered or allowed. There was no citizen representation. This came as a result of surreptitious, behind-closed-door sham "negotiations" over the last two months that overlooked fact, economic research and obvious outcome in other communities. By contrast, the educational, open NCALG conference provided solid economic analysis by experts and research founded on realities. It has been clearly shown that urban casinos cause harm far in excess of any help to the city. Again, look at Detroit, Niagara Falls, New York, Louisiana, Turning Stone or the big casinos in Connecticut - all true losers for these communities. Please understand that there is real human tragedy for individuals and families being created in these "entertainment" palaces. Adult gamblers are modeling the risk of future misery for their children. Buffalo Creek (which will hopefully never open) in legal documents wrote its stated intention is to bring in the local population, but now claims "in writing" that it cares about promoting itself to the region. The Senecas and Brown have no data, no facts and no proof to support the future benefit to Buffalo. The first year's $125 million will go to the building trades - Brown's allies - and yearly thereafter $150 million or more will leave the economy and bring in a zero-development Niagara-Falls type scene, good only for the Senecas and gambling industry supporters.
For every dollar generated, $3 will be lost and $12 million to $16 million in taxes will belong to the sovereign nation, not the city. Five million dollars for the city from the slot cut is 50 percent less than revenue from parking enforcement as projected in the 2006-07 budget.
Is anyone in City Hall doing the math or checking the facts? Not one city official came to the gambling conference. The National Gambling Impact Study Commission stated that as the money is lost faster, the socioeconomic negatives increase dramatically. Its final report confirmed that the gambling industry had created new addicted gamblers, new bankruptcies and new crime and corruption. The 1999 U.S. Gambling Commission unanimously called for a moratorium on the expansion of U.S. gambling. Sadly, however, it has grown into a monster.
Anyone with sense can see the harm coming to Buffalo. Jobs will be lost, restaurants closed, families devastated, bankruptcies and crime increased. The casino is a strategy for injustice, not economic development.
The British government plans next week to seek international support for legalized, regulated online gambling, emphasizing a trans-Atlantic difference on the issue after the Bush administration's recent move to outlaw transactions with Internet gambling services. During a conference scheduled for Tuesday at the Royal Ascot racecourse, the British government plans to seek adoption of a broad code of principles on Internet gambling, according to a person briefed on a communiqué prepared by the British delegation. Officials from more than 30 countries are expected to attend, though the U.S. Justice Department has declined to send a representative. In contrast to the United States, where President George W. Bush this month signed into law a bill that bans credit card companies and online payment systems from facilitating Internet bets, Britain last year moved to legalize online gambling. "We believe that tough regulation is a better approach than a free-for-all or prohibition," Anthony Wright, a spokesman for Tessa Jowell, the secretary for culture, media and sport, said Friday. "We will be looking to secure agreement to the principles for international standards of regulation." Wright's comments echo remarks attributed to Jowell that were reported in The Financial Times on Friday. She, too, alluded to the U.S. prohibition of alcohol from 1920 to 1933, saying the move to ban online gambling could lead to the creation of "modern-day speakeasies," driving Internet gambling underground and into the control of criminals. The U.S. Justice Department did not immediately return a call seeking comment. Some analysts say the British move to legalize and regulate online gambling companies could create financial benefits for the government by allowing it to tax companies that move back to Britain from offshore locations like Gibraltar and Costa Rica.
But the stock prices of online gambling companies, several of whose shares are traded in London, fell after congressional passage of the U.S. legislation. America has been the largest market for these companies, though several of them have stopped taking bets from U.S. gamblers.
The person briefed on the proposed communiqué, who requested anonymity because he was not authorized to speak on the issue, said it was modeled on the principles of the recent British gambling legislation and was aimed at promoting fairness for gamblers, keeping out crime and making sure children and vulnerable people were protected.
The proposal apparently does not address one potentially sensitive area, state control of gambling, over which Britain disagrees with some of its neighbors. Several of the countries scheduled to attend the conference, including France and Germany, have recently moved to protect lucrative state- sponsored gambling monopolies from online competition.
Issues focus on smoking, gambling, wages, the arts
Smoking. Gambling. A sin tax for the arts. An increase in the minimum wage. These are among the contentious issues voters here will decide at the ballot box November 7. Perhaps the most confusing for Ohio voters are statewide Issues 4 and 5. Both would limit smoking in public places, but to different degrees. Issue 4 is a constitutional amendment spearheaded by Smoke Less Ohio, a group supported by the tobacco industry and businesses that cater to smokers. It would allow smoking in bars, restaurants, bowling alleys and bingo halls, but ban smoking in almost all other public places. Because it is a constitutional amendment, it would overturn smoking bans currently in effect in 21 Ohio cities, including Columbus. Issue 5, sponsored by SmokeFree Ohio, a campaign of the American Cancer Society, would ban smoking statewide in all public buildings and workplaces. Exceptions include family-owned small businesses where all employees are related to the owner and where enclosed smoking areas are not open to the public. Also exempt would be outdoor patios, tobacco stores and nonprofit private clubs with no unaffiliated employees. Nursing homes and hotels also could designate smoking rooms. If both initiatives pass, Issue 4 would prevail because it is a constitutional amendment, while Issue 5 is merely a law. Because of the high stakes, Issue 5 supporters are working hard to explain that voters must defeat Issue 4. It is not enough to vote for Issue 5. For the SmokeFree measure to become the law in Ohio, voters must also vote against Issue 4. While Issue 4 supporters criticize the scientific validity of studies showing the harmful effects of secondhand smoke, they also say that well-ventilated areas in bars and restaurants protect non-smokers. But the latest report this summer from the U.S. Surgeon General says there is no safe level of secondhand smoke. Furthermore, employees in the hospitality industry have no choice but to breathe in secondhand smoke. Issue 5 supporters also note that smoking does not simply affect the smoker. Families and society also bear the costs associated with health care for smoking-induced illnesses, reduced productivity or death. The economic issues of banning smoking have been hotly debated. Bar and restaurant owners say smokers will stop patronizing them, costing jobs in the hospitality sector. Smokers, they claim, will buy liquor and drink at home where they can smoke. But studies in cities with bans have either shown that revenues have not decreased, or that declines in some businesses have been balanced by gains in others.
Today's minimum wage buys less than at any time in the last 50 years.
Ohio remains one of only 14 states that do not allow casino gambling.
Arts groups are struggling with declining ticket sales and lower donations in a stagnant economy.
Issue 5 supporters also note that smoking does not simply affect the smoker. Families and society also bear the costs associated with health care for smoking-induced illnesses, reduced productivity or death.
The economic issues of banning smoking have been hotly debated. Bar and restaurant owners say smokers will stop patronizing them, costing jobs in the hospitality sector. Smokers, they claim, will buy liquor and drink at home where they can smoke. But studies in cities with bans have either shown that revenues have not decreased, or that declines in some businesses have been balanced by gains in others.
Issue 2 would raise Ohio's minimum wage from $5.15 to $6.85 per hour starting Jan. 1; waiters and others who receive tips would see their base pay increase from $2.13 to $3.43 an hour.
Last spring, state legislators increased Ohio's minimum wage to the federal minimum of $5.15. That wage hasn't been changed in nine years; economists say today's minimum wage buys less than at any time in the last 50 years.
At $5.15 an hour, a full-time employee earns $10,712 annually, nearly $3,000 below the federal poverty level for a family of two. Relatively few Ohioans earn the minimum; about 300,000 are at that level. But that base wage sets the floor, in effect keeping hourly earnings low, say labor unions and religious, neighborhood and civil rights organizations who support Issue 2.
Opponents, including chambers of commerce, retail merchants, restaurateurs and other businesses, also object to the measure's fine print. They say it would open payroll records to scrutiny from unions and others, invading employees' privacy and burdening employers with additional record keeping.
Supporters point to the amendment's language, which specifically forbids disclosure of an employee's name without that person's permission. The federal minimum wage already requires such record keeping, they point out.
Critics also object to amending the Ohio Constitution to raise wages. Instead, they say, the legislature should act to increase the minimum wage.
Surveys show that most people think Ohio's minimum wage is too low, but opponents of Issue 2 say its annual adjustment for inflation is a bad idea. While Ohio's minimum wage is now below many other states, several rounds of inflation could boost labor costs here so high that businesses would choose to locate or expand elsewhere.
Supporters of Issue 2 emphasize that $5.15 an hour is not a living wage. Furthermore, better-paid employees are less likely to seek work elsewhere, which is better for businesses, they point out. Studies show that states with higher minimum wages have more job growth than those without the more generous wage protection, proponents say.
Supporters call Issue 3 "Learn and Earn" because the constitutional amendment would allow 31,500 slot machines at nine sites in Ohio; a portion of the revenue would go to college scholarships.
Gross annual revenue from slot machines will be $2.8 billion, proponents estimate. Slots operators would get 55% of any money not won by players. This 55% will be used to pay employee salaries and benefits, equipment, site operations, advertising, debt service and taxes. Estimated annual profits for each site would be about $20 million or $180 million total.
Of the remaining slots revenue, 30% would go for tuition scholarships to Ohio students attending Ohio colleges. Supporters estimate this at about $850 million; Ohio Office of Budget and Management estimates $324 million.
Eight percent (about $225 million) would go to economic development and capital projects, with Cleveland's share of that totaling about $75 million. Six percent (about $170 million) would increase purses at Ohio racetracks. One percent ($28 million) would go to gambling addiction services.
Issue 3 would allow slots at Ohio's seven racetracks as well as at two downtown Cleveland locations: Tower City, which is owned by Forest City Enterprises Inc., and at Nautica Entertainment Complex, operated by Jeff Jacobs. In 2010, voters here could expand the four Cleveland-area sites to offer full casinos with gaming tables. Downstate racetracks would not have that option.
Ohio gamblers spend over $1 billion annually at casinos in Indiana, West Virginia and Michigan, estimate supporters, who include many civic and business leaders. Ohio remains one of only 14 states that do not allow casino gambling.
Opponents, many of whom are also religious leaders and state officeholders, emphasize the downside of slots and casinos. Gambling will create more crime and more addicts, burdening social service agencies and county budgets. There's a finite amount of entertainment dollars; Issue 3 will just shift them from theaters and restaurants to slots parlors and casinos.
Revenues from gambling will not solve the educational funding crisis in this state, opponents say. It will only cloud the issue. However, proponents counter that Issue 3 forbids the Ohio General Assembly from using Learn and Earn proceeds to cut educational funding.
Critics point out that most of the profits will go to a handful of wealthy racetrack owners and slots operators, giving them a constitutionally mandated monopoly. Proponents counter that the slots parlors will pump billions into Ohio's economy and create up to 56,000 good-paying jobs with benefits. Cleveland could see 5,000 new jobs.
Ohio already has a lottery and other forms of gambling such as church bingo games, proponents note. Thus, it's hypocritical for religious leaders and others to oppose slots parlors.
This is the third time since 1990 that Ohioans have been asked to vote for a gambling provision. The last two gambling initiatives were defeated statewide by wide margins.
Issue 18 would raise the tax on cigarettes to provide funding for arts and culture in Cuyahoga County. The measure, which lasts for 10 years, would increase the tax per cigarette 1.5 cents, adding 30 cents to a pack.
Levy supporters estimate the tax will raise $20 million annually, even assuming a decline in cigarette purchases due to the higher price. The money would provide operating support for the county's 105 nonprofit arts institutions such as Great Lakes Theater Festival and the Maltz Museum of Jewish Heritage. It also will fund artist residencies and innovative projects by individual artists.
The county arts and culture organizations add over $1 billion annually to the local economy, supporters say, a larger economic impact than that of Cleveland's major professional sports teams. The arts groups also employ 3,000 people full-time and generate 7,000 jobs at related businesses.
Arts organizations here are struggling with declining ticket sales and lower philanthropic donations in a stagnant economy. They've lost support from major corporations who have departed the area. Furthermore, Cleveland is one of the few major metropolitan areas with little dedicated funding for the arts.
Most of the opposition to the measure comes from smokers, who feel they are being unfairly taxed again to pay for economic development. Excise or so-called sin taxes helped pay for the Gateway complex and Cleveland Browns Stadium.
Other opponents, who include small business owners, say the measure will hurt convenience stores, bars and gas stations. The drop in cigarette sales will cause them to layoff employees, thus adding to the unemployment rolls. Retail cigarette sales will drop, further hurting the economy, and tax revenues will decrease. Smokers will buy cigarettes online and out-of-county, delivering another blow to state and county tax revenues.
Other detractors point to the hypocrisy of saying Issue 18 will promote healthy living by reducing cigarette smoking at the same time it capitalizes on that behavior to finance arts organizations.
Getting much less attention than the other ballot initiatives is Issue 19, the 2.9-mill, four year, replacement tax for health and human services in Cuyahoga County. The measure is listed on the ballot as a tax decrease because the millage drops from 3.0 to 2.9. However, tax bills will increase if the issue passes because inflation has increased property values.
Homeowners would pay $397 annually on a $100,000 house, rather than the $359 they now pay. The $38 added tax would raise $27.3 million a year.
Among other county programs, the tax helps pay for MetroHealth Medical Center - its Metro Life Flight, Level One trauma center, and burn unit. The levy also funds home health care, hot meals and transportation for seniors, health care for infants and toddlers, foster care for abused children, and treatment for emotionally disturbed youth.
Online Gambling and Online Poker Players- Its Pay Back Time Kyl!
A growing initiative to unseat Kyl from his comfortable Senate appointment. Kyl reportedly has ambitions to become the Republican majority leader in the Senate following Senator Bill Frist's departure Both Republicans played a major role in ramming the Unlawful Internet Gambling Enforcement Act through Congress in the closing minutes of the pre-election session, angering millions of Americans who regard online poker and online gambling as an entertainment of choice. Reports today suggest that dozens of websites focusing on Arizona will join the campaign to unseat Kyl for his role in the attack on online poker and online gamblings' rights whilst his own state runs diverse forms of online gambling including state lotteries and Horse racing, which were excluded from the online gambling ban- so Kyl was really helping Horse racing and banning poker- what and insane bill. online poker and online gaming sites are urging their Arizona players to participate in the initiative, with one major operation claiming it has at least 5 000 Phoenix, Arizona online gambling and online poker players on its database that it will alert to the action. Jim Pederson has a very credible chance of beating Jon Kyl. We as poker players need to send Jon Kyl a very clear message that we are strong and we need to be represented as much as his special interests (lotteries and Horse racing). Please give any amount that you can. We can make a difference and show Senator Kyl that we won't stand for his hypocrisy. We as poker players sat by while Jon Kyl used national security as a political tool to push this legislation through. It won't happen again.
Unregulated internet gambling is simply adding to the growing problem of addiction, delegates attending the Canadian Association of Suicide Prevention conference in Toronto were told this week. An estimated 200 compulsive gamblers commit suicide in Canada every year, said Terry Flynn, a director of spiritual care at the Bellwood Health Services facility in Toronto. The growth of gambling on the internet, where no regulations exist, is making the problem worse, Flynn said. "It's hidden. You can lie about it and tell people you're doing your homework or that you're researching something, but in fact you're getting into deep trouble," he said.The ever-increasing options available to gamblers in the North - everything from card games to the internet - are contributing to the growing problem, Iqaluit counsellor Sheila Levy told delegates. "They are doing very well with their jobs and making a lot of money, and yet their children are going hungry often because the money goes perhaps in one night in gambling," Levy said.
Former Commonwealth Bank employee Erick Tjandra, 32, was jailed for a minimum three years on 37 counts of defrauding the bank. Over a 15-month period Tjandra stole $10.4 million from the bank, $8 million of which he "poured down the throat of the casino'', District Court Judge Christopher Armitage said today. The casino had allowed the bank clerk to play in the high-rollers room alone against the house, Judge Armitage said. ''(It was) the height of irresponsibility for the casino to have placed such a vulnerable person in the situation of gambling in what is called the Kerry Packer Room, against the house,'' he said. "He was not Kerry Packer, he is not ... an Asian prince. "He is a humble bank clerk who unfortunately developed a gambling addiction beyond his means.'' Tjandra was sentenced to five years' jail with a non-parole period of three years. He will be eligible for release in October 2009.
Internet Gambling Ban Protestors Headed to Washington D.C.
The voices talking so loudly against the Unlawful Internet Gambling Enforcement Act (UIGEA) on forums and blogs across are the internet will be leaving their keyboards on November 3-4 and will be headed to Washington D.C. to protest the latest US prohibition. The purpose of the demonstration will be to gain press coverage from major news organizations such as Fox, MSNBC, and CNN (who have all promised to attend the event) in order to get the message out to the general public before they vote. The message they are trying to get out to voters is that Republicans, led by the soon to be parting Senator Bill Frist, have begun a modern day prohibition by deceitfully attaching the ban to an unrelated piece of legislation on the last day of senate sessions. The fact that they attached the bill to unrelated legislation about Port Security, an issue that was impossible for anyone to vote against, angered other politicians about as much as it angered the 25 million American citizens who participate in online poker. "What could be a greater invasion of privacy than government telling you cannot play Internet poker in your own house?" congresswoman Shelley Berkley said. "This was a breathtaking abuse ... of power." "The ban on Internet gaming was part of the Republican family values agenda. They passed it to pound their chests and talk about how they're protecting America's youth," Berkley said. "You got a bunch of ideologues running Congress. They're not interested in anything that has a modicum of common sense; they're only interested in a very narrow moral position."
Berkley insisted that the protest expressing dissent will surely be heard by politicians and other Americans before voting time.
Debbie Richardson, the person instrumental in organizing the protest against the ban, has reported to us that over 250 people have confirmed they will be attending and that many singular people said they will be bringing groups along with them.
Poker (for chips only) will be played in the streets as part of the protest. There have been rumors that celebrities who support poker may show up, and other speakers are confirmed.
"We think we have enough people who confirmed showing up for the event that could fill up the square behind the White House," and that many people, Richardson explained, will get noticed by the press.
"The more people show up for the protest the more interest the press will show," Richardson said. She also expects a large number of people to attend who have not confirmed.
The Pennsylvania Legislature was unable to finalize a long-awaited gambling reform bill Tuesday night after the House amended a number of provisions, including one it claims was the result of a Senate drafting error. The gambling reform bill was the second piece of major legislation on the agenda that lawmakers may be unsuccessful in finishing up before the November election because of overlooked errors. A negotiated bill on lobbyist disclosure fell apart after the Senate passed an amendment Monday night that accidentally used language from an earlier version. What exactly happened on gambling reform is in dispute. A top Republican Senate aid, Erik Arneson, said the change that mucked up gambling reform was not a mistake but rather the result of attempts to address concerns raised by House negotiators. That Republican aide, as well as a top Democratic aide, hinted that the Senate might return after all to clean up both bills, afte