While many online casinos are suffering downturns, online casino software providers Playtech, whose software powers such big industry names as Betfred and Titan Poker, have recently unveiled their fourth-quarter 2008 “Key Performance Indicators” report. The report shows record profits.
Total revenues in the last three months of 2008 were €31.5 million, up 52% from 2007’s fourth quarter. The online casino and online poker businesses did equally well, both up around 50%. In Asia-Pacific growth was a staggering 141%.
Chief Executive Mor Weizer said: “Once again we have enjoyed a successful quarter both operationally and strategically as we continue to grow the business and make the most of the opportunities presenting themselves. We are particularly pleased with how smoothly the integration of the William Hill joint venture has progressed, which bodes well for this important strategic company development. The company has met management’s demanding expectations and we are confident that Playtech will meet its targets for the full year.”
Much is going on at UltimateBet with the well known poker group having filed a $75 million claim against a Canadian company involved in the software which the group used. So what happened?
It is alleged in court papers that UltimateBet was the victim of a scam which ran from January 2005 to January 2008 and is said to have netted the alleged crooks tens of millions of dollars. It has been compared to the scam which hit UltimateBet’s sister site AbsolutePoker but this one seems to have lasted for much longer and netted an awful lot more money.
While details are still fairly thin on the ground there appears to have been some kind alleged ring of players involved who seem to have had access to information and data which was not available to the public. UltimateBet has stated that those who lost money will be repaid, after an outside investigation has been completed, but there are concerns that the issue could drag on for some time before being unravelled to the public. This fiasco has tarnished the entire industry.
State gambling regulators have approved a rescue for a financially troubled Pittsburgh casino project, but problems plaguing three other prospective casinos may be far more difficult to resolve. There must be a limit to what amount of money the local government is willing to sink into this plan.
A political stalemate in Philadelphia has left two projects there in limbo, and a northeastern Pennsylvania casino is being managed by a state-appointed trustee while its owner fights four counts of perjury that could cost him his $50 million slot-machine license.
As a result, the Pennsylvania Gaming Control Board has drawn criticism over its choices of casino projects.
Sen. Jim Ferlo, D-Allegheny, submitted comments to the agency saying grave deficiencies exist in the board’s decision-making. Sen. Jane Orie, R-Allegheny, said it has failed to act proactively and demand accountability from the casino groups it has licensed.
The board has maintained that it did its duty in every case, and made the best choices available in licensing a new casino industry that contributes to the government more than half of every dollar it brings in. Many of the problems dogging the casinos - for instance, efforts by Philadelphia city officials and lawmakers to force the casinos to move from planned sites on the city’s riverfront - have nothing to do with the board, agency officials have said.
On Thursday, the board approved the financial rescue of the first owner of the Pittsburgh casino that the agency licensed. Board members thanked Chicago real-estate billionaire Neil Bluhm, who is spearheading the new investor group - and bristled at the criticism. Regardless of all the problems the casinos still offer much hope for a sinking economy.
So the opponents of a federal ban on Internet gambling stood up during a congressional hearing last week and sait that it would be much wiser to legalize and regulate betting than prohibit it. “In the end, adults ought to be able to decide for themselves how they spend the money they earn themselves,” said Rep. Barney Frank, the Democratic chairman of the House Financial Services committee and primary backer of the legalization effort.
The hearing even included witnesses from companies that process online payments. Generally speaking, they echoed the arguments once used in favor of ending alcohol prohibition and that are now being invoked to decriminalize marijuana: It’s better to legalize, tax and carefully regulate an industry than let it flourish with far less oversight in the black market. Some countries already do just that. In the United Kingdom, for instance, Internet gambling is legal and strictly regulated. Some of the larger online casino operators are publicly traded on the London Stock Exchange.
“On the basis of my experience I can unequivocally state that Internet gambling can be regulated, and that abuses can be effectively regulated and controlled,” said Jon Prideaux, a consultant who until last year was the head of Visa Europe’s Internet arm. A law that President Bush signed last year tried to eliminate many forms of online gambling by targeting Internet service providers and financial intermediaries, namely banks and credit card companies that process payments to offshore Web sites. The bill never received a formal vote in the entire Congress but instead was glued onto an unrelated port security bill that the Senate unanimously approved.
Now the pro-legalization forces are trying to marshal a counterattack. Frank introduced a bill in April that would replace the current broad prohibition with strict regulations–including criminal background checks and financial disclosure–imposed on companies that offer legal Internet gambling. (It’s called the Internet Gambling Regulation and Enforcement Act.)
Texas Rep. Ron Paul, a 2008 Republican presidential contender who topped CNET News.com’s technology scorecard last year, said adults should be allowed to make up their own minds about whether to gamble. He said he was a strong supporter of Frank’s bill “to restore the rights of Americans to decide for themselves whether to gamble online.”
Gerald Kitchen, the chief executive of U.K.-based SecureTrading Group, said his company is a payment service provider that processes a wide variety of financial transactions, including ones related to online gambling. He said SecureTrading’s system has been reviewed by banks including Barclays, Lloyds and the Royal Bank of Scotland, and provides protections against money laundering, underage gambling and compulsive gambling.
“There are ways to protect against these exact harms and ills that the opponents of Internet gambling regularly cite as reasons to prohibit Internet gambling,” Kitchen said. But it’s too early to say whether the bill will receive a favorable committee vote. For one thing, the top Republican on the panel, Rep. Spencer Bachus from Alabama, offered an impassioned defense of criminalization.
“Some people claim that illegal Internet gambling’s a victimless crime,” Bachus said. In reality, he warned, it’s a “mushrooming epidemic leaving in its wake suicides, crime, family tragedies.” Just because gambling is not allowed legally will just drive those that want to play, underground and feed organized crime and such. Another stupid idea from a politician that just wants to get the bible belt vote no doubt.
I am taking a look at the news of the European Union launching an investigation last month into whether U.S. prosecutions of foreign online gambling companies are discriminatory, possibly paving the way for action at the World Trade Organization. European online gambling companies, such as PartyGaming and BWIN Interactive Entertainment, complained in December that the U.S. Department of Justice singled out foreign online gambling companies.
“The U.S. has the right to address legitimate public policy concerns relating to Internet gambling, but discrimination against EU companies cannot be part of the policy mix,” EU Trade Commissioner Peter Mandelson said in a statement.
The Commission said it would look into the complaints over the next five to seven months and could decide to launch WTO proceedings against the United States. The United States came into dispute with the EU and countries outside the EU after it withdrew its WTO commitments to opening up its gambling markets to foreign companies and then introduced measures in 2006 to cut off that access.
The measures wiped billions of euros off the stock market value of the European sector. The European Commission agreed in December to a U.S. offer of openings in other sectors as compensation for the measures. But the U.S. Department of Justice is still investigating the activities of EU companies before the measures were introduced. A U.S. Justice Department spokesman said they had no immediate comment on the EU’s decision to investigate whether to file a complaint at the WTO.
U.S. trade officials said they had been assured by EU officials the investigation would not upset the compensation package the two sides struck in December. EU companies complain the United States has allowed U.S. companies offering Internet horse race betting to continue operating, while other forms of online gambling have banned.
“Our basic approach is that we don’t want discrimination between operation nationality in this area,” the EU Ambassador to the United States John Bruton said in an interview with Reuters reporters in Washington.
As part of a U.S. crackdown on Internet gambling, two founders of payments processor Neteller were arrested last year and BetOnSports also pleaded guilty to U.S. racketeering charges and agreed to cooperate in a case against the company’s founder and other co-defendants. Clive Hawkswood, chief executive of Europe’s Remote Gambling Association, welcomed Monday’s announcement by the Commission and said companies hurt by the U.S. market closure were suffering a “double whammy” of being prosecuted while U.S. rivals were not.
“By any analysis, the U.S. policy is fundamentally unfair, and we are delighted that the Commission shares our concern and alarm,” he said in a statement. “The U.S. simply needs to end its discriminatory prosecution of EU companies, and their shareholders, who have after all been out of the U.S. market for almost two years now.”
It would be refreshing to hear the truth come out of a US politicians mouth for a change, and for them to admit the real reason they made online gambling illegal for those residing in the US. It comes down to money and lots of it that the US government has not figured out how to tax yet. Once they do you can bet it will be legal again.