Archive for March, 2012

Online Lottery Tickets Come to Illinois

Monday, March 26th, 2012

In recent months, legislators across this country have been debating the benefits of legalizing online gambling.  Advocates have consistently cited increased tax revenues and the ability to regulate the industry as solid reasons to make the move towards legalization.  Groups that oppose the idea often suggest that revenues might not be as juicy as some think, and, ultimately, the major result would be an increase in gambling addicts.

While there are a growing number of states that seem to be on their way to initiating online gambling programs of one kind or another, until now, there hasn’t been one state in the U.S. to actually pull the trigger and put one in place.  As of Sunday, though, residents of the state of Illinois will be able to purchase lottery tickets online – provided they are of legal age, and within the state’s borders while doing so.

It may not seem like such a big deal, considering how commonplace it has become to purchase things online these days – but seeing as no other state has yet to put this simple measure into place, this move certainly has its significance.  In fact, it is likely that Illinois’s decision to take their lottery to cyberspace will now impact at least some of the debates, regarding online gambling, that are raging on at the moment in other states.

There are a number of reasons to believe that Illinois will be successful in this endeavor – which will, of course, only lead to more states following suit.  For one thing, the Illinois Lottery seems to be going to great lengths to prevent an increase in gambling addiction from being a result of this program.  It has even been suggested that by selling tickets online, the state may be in a better position to prevent individuals from purchasing lottery tickets excessively.

Michael Jones, the Illinois Lottery superintendent told The Huffington Post, “On the Internet, we will have, for the first time ever, the ability to monitor and stop people from playing too much.  Right now I can’t stop anybody from walking into a convenience store and spending all their money on tickets. Within the system we are going to have, we will know how much people are spending on the lottery.”

If someone wants to purchase Lotto or Mega Millions lottery tickets online, they will have to provide certain information in order to demonstrate they qualify to do so.  Social Security numbers will be used to verify the age of a potential ticket purchaser.  The Illinois Lottery will use software that tracks where purchases are being made from so as to prevent anyone from buying tickets outside of the state’s borders.  And to assure that only residents of Illinois are purchasing tickets, a home address will be required from anyone attempting to purchase a ticket.

As part of their effort to combat gambling addiction, the state may limit the number of tickets that can be purchased on any one drawing by an individual.  An across the board limit of this kind would most likely be easier than it would be to keep track of how many tickets a particular person is purchasing within a given period of time – though the statements that Jones made to the Huffington Post indicate the Illinois Lottery is at least considering monitoring individuals in that way.

In order to increase the number of lottery tickets that are actually being purchased, without relying on people that are already buying tickets to simply buy more, the state intends to broaden the customer base by utilizing the Internet’s ability to reach such a large number of people.  This will most likely require a new approach in terms of the state’s advertising strategy for lottery tickets, but if implemented correctly, Illinois should see a significant increase in tax revenue that can then be used for critical programs like education and infrastructure.

Possible Olympic Fixing Targets in 2012

Wednesday, March 21st, 2012

When most people think of sports betting here in the United States, they probably think of men’s college basketball and NFL football. When they think of sports betting in England, they probably think of soccer and cricket. But with the 2012 Summer Olympics just around the corner, there will no doubt be a great number of bets placed on the various events that make up the Games. For this reason, efforts are being made to keep all bets associated with the London Olympics as free from scandal as possible.

Surprisingly to some, the British betting industry is spearheading efforts to keep the games clean of fixing scandals. They recently put together a seminar with Olympic organizers so they could collectively strategize on how best to accomplish this goal.

The driving fear is that Olympic athletes will be enticed by Asian bookmakers, operating illegally, to potentially throw events in return for financial pay-offs. Smaller sporting events would be ideal targets for this as they attract less attention than the more popular sports like gymnastics and swimming. But the legal betting industry, as well as the organizers of the Games themselves, all agree that scandals involving corrupted athletes have no place in the 2012 London Olympics.

The Business Director of the British bookmaker Ladbrokes, Mike O’Kane, discussed with Reuters how he intends to monitor bets placed on smaller events. “If I see a bet of more than 50 pounds I’ll be looking at who it is, because I’m not expecting 50 pounds on weightlifting or badminton.” He also stated, “Where the issues are, if there are any issues, will be illegal betting out of Asia.”

While steroid use is usually thought of as the number one concern, there is an increasing feeling that fixing scandals could do just as much, if not more, to damage the integrity of the Games.

NASCAR Betting on the Rise

Thursday, March 15th, 2012

Nascar-BettingWhen it comes to betting on sports, the third month of the year is usually all about college basketball. With the super bowl behind us, and baseball not quite here yet, college hoops usually has center stage all to itself.  But, with Las Vegas hosting the Sprint Cup Series this weekend, it seems appropriate to note the growing popularity that NASCAR is enjoying in the world of sports betting today.

There is, of course, no doubt that football and college basketball still reign supreme as the biggest draws around.  Each year, the NFL’s Super Bowl and the NCAA’s single-elimination tournament known as March Madness both attract massive amounts of betting action from die-hard gamblers and novices alike.

But Vegas insiders are noticing the increasing interest in NASCAR betting that has been coinciding with the public’s growing love of the sport.  Each year, more and more fans are discovering the excitement that NASCAR loyalists have been raving about for years.  Debates over whether racing even qualifies as a sport are happening in far less frequency, and the fan base is becoming more and more diverse.

As racing becomes more of a mainstream sport, the number of big-time Vegas sports books that are taking NASCAR related bets is rising too.  Fans of the sport can now wager on a wide range of possible outcomes related to a given race.

Just like in football, where fans can bet on how many field goals a certain kicker will miss in a given game – NASCAR fans can try and guess the number of caution flags that will fly in a particular race.

Of course, those seeking more normal betting fair can simply place a wager on who will actually win the race itself.  The odds on a given driver will be determined by the many factors Vegas sports books account for when setting a line on anything.

Bwin.Party Looks to Make U.S. Return

Saturday, March 10th, 2012

Bwin.Party Digital Entertainment plc, owner of the world’s second largest online poker room, may be closer than ever to returning to the U.S. market after having left it just days following the Unlawful Internet Gaming Enforcement Act’s passing in the fall of 2006.

The company, who’s stock trades on the London Stock Exchange, recently applied to the Nevada Gaming Control Board for a gaming license as part of a larger effort to better position itself for the legalization of online poker in the United States – something that most people today agree will happen one way or another in the near future.

With nobody able to predict for certain the means by which online poker will first be legalized, a play for a Nevada gaming license makes a great deal of sense for the Gibraltar-based company.  If for no other reason, this is because Nevada’s state legislator has already officially legalized online poker within the state, though no licenses have yet been awarded to any company – and while there is always the possibility of a federal bill that will regulate online poker, most people think state-by-state legalization is the more likely outcome.

Bwin.Party was created in the spring of 2011 when Bwin Interactive Entertainment AG merged with PartyGaming plc.  The resulting company became a dominant force in online gambling around the world.    Its online poker room, PartyPoke,r is today the second largest of its kind, and the company itself is the largest online gambling company to be traded publicly on any the world’s exchanges.

Before its merger with Bwin, in early 2009, PartyGaming took steps that helped make it possible for the company to seek licensing in the states today.  They basically avoided prosecution for providing online gambling to U.S. citizens by settling with the feds and agreeing to pay a fine that totaled over $100 million.

The settlement was forward thinking on behalf of PartyGaming because had they been prosecuted at that time, their chances of getting licensed in the states when online gambling is legalized would have been significantly hurt.  The move to settle and pay such a large fine indicates how important the company felt the U.S. market would be once legalization eventually became a reality.

Bwin.Party’s Chief Operating Officer Jim Ryan recently discussed with PokerNews the possible impact that U.S. legalization of online poker could have on his company.  He remarked on the potential for a “very meaningful liquidity pool”, but did suggest that it would be difficult to regain the massive market share PartyPoker had before the UIGEA drove the company out of the U.S. market in 2006.

One reason that Ryan and his partners at Bwin.Party are hesitant to make boisterous claims about dominating the U.S. market is probably due to just how competitive the battle for licenses is expected to be.  There are tribal interests, state lotteries, other online outfits and land-based operations all seeking what will certainly be a limited number of licenses awarded by the states.

In fact, some states may keep companies like Bwin.Party out of the process all together.  New Jersey is currently in the process of considering legislation that would permit Atlantic City casinos to offer online gambling to residents of the state.  This legislation clearly aims to protect the state’s land-based casino operations while also creating an opportunity for an increase in tax revenue.

Despite the approach that New Jersey is currently considering, everyone agrees that there will be plenty of opportunities for companies like Bwin.Party to benefit from the legalization of online poker.

At the moment, the Nevada Gaming Control Board holds the cards that will determine whether Bwin.Party will be able to offer real-money gaming to Nevada state residents.  But with so many other states considering online gambling programs of their own, one can expect to see Bwin.Party soon applying for additional licenses in other states too.

Singapore’s Success With Casinos Influencing Vietnam

Wednesday, March 7th, 2012

With the recent birth of Singapore’s ultra successful casino industry, and so many neighboring countries looking to follow suit, Asia is quickly becoming the new hot spot in casino development.  As evidence of this, both Japan and the Philippines are currently looking into developing vital gambling industries of their own.  But it seems that Vietnam may be the first to actually take a step towards becoming the next big thing in Asian gambling.

As reported by the Wall Street Journal, Vietnam’s Finance Ministry has indicated recently that they will be legalizing sports betting – an understandable opening move in what some feel will be the country’s ultimate shift towards a completely new policy on gambling.

At the moment, betting on European soccer matches is an extremely popular past time in Vietnam.  Of course, it is currently illegal to do so, and as a result, all bets are taken by underground gambling operations.

A move towards legalization would allow the government to better control the social impact that sports betting actually has on the country’s population.  One can easily assume that strict regulations will be put in place, though it is unclear if the Vietnamese government actually plans on running the sports betting market once it is legalized.  Regardless, there will be a number of private companies, both local and foreign, eager to get in on the action.

Though legalizing sports betting is definitely a move in the right direction, it must be followed by further policy shifts if Vietnam wishes to benefit from gambling to the same extent that Singapore has.  Actually, Vietnam already has a few casinos, but they are not accessible to the Vietnamese people.  The government only permits individuals with foreign passports to enter them.  As a result, a common practice for Vietnamese citizens seeking to enjoy the casino experience is to cross into near-by Cambodia for gambling holidays.  But since the intention of the law that permits only foreigners to enter Vietnamese casinos is to protect the country’s people from what the communist government sees to be the evils of gambling, these trips to Cambodian casinos seem to defeat the purpose.

Of course, if the legalization of sports betting is deemed a success, one might expect a new policy on casinos will follow.  Due to Singapore’s ability to develop a thriving casino industry without seeing an increase in crime, as many feared would happen, proponents of such a move in Vietnam have a strong hand to play when arguing their point.

With a massive population of its own and tourism on the rise, Vietnam would make an ideal landing spot for any U.S. casino developer looking to expand in Asia.  If the government opened its doors to foreign operators and changed its gambling laws regarding the Vietnamese people, a multi-billion dollar industry would most likely follow.

As reported by James Hookway and Vu Trong Khanh of The Wall Street Journal, by the year 2015, Asia will account for just over 40% of the world’s casino market according to PricewaterhouseCoopers.  This would be an increase of over 10% from five years earlier and could be followed by even greater growth as the region becomes more welcoming to casino gambling on whole.

As Asia does become more of a dominant force in casino gambling, it will be interesting to follow what effect that has on the Las Vegas casino industry.  For so many years, sin city has been the beneficiary of Asian countries’ tight fisted approach towards gambling.  As more of them now develop casino industries of their own, Vegas casinos will have to find new ways to attract gamblers from that region of the world.

Efforts Underway to Bring More Casinos to Michigan

Monday, March 5th, 2012

There is currently a battle brewing in Michigan.  With an already successful casino industry, and the potential for billions of dollars in annual profits, a number of competing efforts are underway to secure a piece of the pie.  At the moment, proposals exist that could bring as many as 22 new casinos to Michigan, a state that already has 25 casinos to speak of – 22 tribal casinos and three non-tribal.

The state’s three non-tribal casinos are located in the city of Detroit.  They have been wildly successful thus far, and investors seeking to expand Michigan’s casino industry have clearly taken notice.  Just last year, the three Detroit casinos took in revenues of approximately $1.4 billion – and in 2010, they contributed almost $100 million to help fund Michigan schools.  That last statistic is of particular importance.  While investors are attracted by the potential for obscene profits, the state officials whom ultimately hold the cards are motivated by tax revenue needed to fund everything from education, to healthcare, to prisons.  Michigan, after-all, was one of the states most affected by the recent recession brought on by the housing crisis of 2008.

One of the strongest arguments investors can make for bringing more casinos to the state is that casinos create jobs.  In 2011, Michigan’s 25 casinos combined to employ nearly 25,000 people according to estimates put forth by state officials.  Job creation and tax revenue are extremely potent arguments for proponents of casino expansion.  Recently, Massachusetts expanded its gambling laws to pave the way for three brand new casino resorts to be built in three different regions of the state.

Unlike Massachusetts, whose three new casinos will be the first ever permitted to operate in Mass., Michigan is by no means a newcomer to the casino industry.  In fact, Detroit’s casinos alone have caused their home city to be rated the fifth largest casino market by The American Gaming Association.  And despite this distinction, investors clearly feel that the motor city’s casino industry has room left to grow.

An organization called Michigan First has proposed to build an additional four non-tribal casinos in the Detroit area.  This group seemingly has the support of Mitch Irwin – Michigan’s one-time budget director who worked for Jennifer Granholm, the former governor.  When the Detroit Free Press approached Irwin to comment on Michigan First’s proposal, he remarked, “We’re not ready to announce anything publicly right now.”  He did, however, suggest that information could be released later this month that would shed more light on the organization’s plans.

Documents surfaced recently that reportedly demonstrate the massive gambling expansion that Michigan First is calling for.  In addition to four new casinos in or near Detroit, the group is targeting cities like Lansing, Cadillac and Grand Rapids for further casino development.  In order to achieve such a feat, Michigan First seeks to amend the state’s constitution in November.  An effort like this could cost as much as $50 million to pull off.

One of the greatest challenges facing Michigan First and the other organizations like them seeking to expand casino gambling in Michigan is that their interests are in direct conflict with those of the existing casinos in the state.  At the moment, tribal casinos and non-tribal casinos seem to be forging a partnership to strongly oppose efforts that would create significant competition for their casino businesses, including internet casinos.

With so much at stake, one can expect that both sides will spend large sums of money in an effort to win the support of state officials and voters alike.

Euro Online Gambling Prepares for Take-off

Sunday, March 4th, 2012

Lingerie clad stewardesses and online gambling for charity?

Lingerie clad stewardesses and online gambling for charity?

If you are at all like me, you will go to great lengths to pass the time when flying on an airplane.  I will jam every piece of electronic gadgetry I own into the pockets of my laptop case with the hope that somehow I can keep myself entertained until the plane lands.  At times I think I may even spend more time preparing for a flight by downloading all kinds of goodies to my iPad, than the actual length of the flight itself.  It’s a compulsion to be sure – but I think Ryanair may be on to a cure.

The low budget airline from Ireland has announced that it recently inked a deal with online casino giant 888 to bring online gambling to the skies.  Now, unfortunately for those of us who would love nothing more than to sip a cocktail while testing our luck at 30,000 feet – this deal doesn’t mean that euro online gambling will be offered in flights right away.  When that actually happens will have a great deal to do with where regulators come down on the issue of in-flight gambling.  But the deal certainly means things are heading in the right direction.

In the meantime, evidence of this partnership will first be available on the Ryanair website.  In the near future customers who visit the site will have the entire line up of 888 casino games at their disposal.  It won’t even be necessary that you book a flight to take part in the fun.  Ryanair must believe that they will ultimately benefit more by not restricting game access to only those customers who actually purchase flights.

To make things more inviting, 888’s regular offerings will be augmented by travel related incentives.  One could imagine accumulating frequent flyer mileage by way of a casino bonus.  But even more fun than that would be the ability to play online poker for real money with other passengers on one of my flights.  That is something I will surely look forward to.

But for now, while our online gambling is relegated to the ground, we can always access great online casinos like 888 right here.

Suit Filed to Combat Nevada Gambling Tax

Saturday, March 3rd, 2012

As the 2012 presidential election gears up, the ongoing battle between democrats and republicans over how best to tax successful corporations rages on.  Republicans contend that lower tax rates encourage businesses to invest more of their profits back into the economy.  Democrats argue that taxing extremely successful companies at a slightly higher rate would not lead to less economic growth, but simply allow the government to avoid turning to austerity measures in order to deal with our ever-growing deficit.

This philosophical debate will most likely continue to be fought all throughout this year’s presidential election – and probably far beyond that until either the cows come home or the fat lady sings.  But in Nevada, a battle over a possible tax hike is taking place right now, that some argue will have a potentially huge outcome for the state.

Last month, an initiative was filed that seeks to raise taxes on Nevada casinos that take in gambling revenue exceeding $250K per month.  Monte Miller, a Las Vegas businessman working in conjunction with an organization called Nevadans For A Fair 9 Percent Gambling Revenue Tax, filed it.

On Wednesday, the Nevada Resort Association filed suit in a Carson City District Court in an effort to stop Miller’s initiative in its tracks.  The association represents many big-time casino owners who stand to lose great sums of money if their casinos’ revenue is taxed at a higher rate.

The previous rate of 6.75 percent would be raised to 9 percent if Miller’s initiative ultimately passes and goes into effect.  One of Millers representatives explained how the suit filed this week came as little or no surprise to them considering the financial interests involved.

If Judge James Todd Russell agrees with the Nevada Resort Association’s claims that the initiative petition is misleading, he could insist that supporters stop collecting signatures at once.  This would effectively put an end to the initiative’s supporters’ hope of having their petition considered by the state’s legislators next year.

Bodog Online Gambling Site Shut Down

Thursday, March 1st, 2012

At the same time that numerous states are considering legalizing online gambling based on a ruling from the Department of Justice that indicated they could do so without violating the Wire Act of 1961 – the DOJ is still fighting old battles against its online gambling foes. After prosecuting three online poker giants last year, federal prosecutors took their fight to the ultra successful online gambling website Bodog this week.

The feds made their first move on Monday when they seized Bodog’s domain name in an effort to shut down their operation – at least for the time being.  Anyone who types in bodog.com will be greeted by a webpage flaunting logos of the DOJ and the U.S. Customs Enforcement Homeland Security Investigations.

One day following the seizure, indictments naming Bodog founder Calvin Ayre, as well as operators of the company’s website David Ferguson, Derrick Maloney and James Philip, were unveiled in Baltimore. The investigation was a collaborative effort between numerous government agencies. In the lead was the U.S. Immigration and Customs Enforcement Homeland Security Investigations office in Baltimore. The HSI received support from the Maryland State and the Anne Arundel County Police departments. Prosecutors also credited the Internal Revenue Service for their involvement.

The investigation included feds posing as online gamblers as well as at least one former Bodog employee being interviewed. The government says winnings were paid by checks sent to Maryland addresses that investigators provided when they set up their Bodog accounts. They claimed to have knowledge of over $100 million paid in winnings to U.S. gamblers over the past seven years. The U.S. Attorney’s office also took issue with the tens of millions in advertising dollars Ayre’s company spent to entice US citizens to engage in illegal gambling.

U.S. Attorney Rod J. Rosenstein remarked, “Sports betting is illegal in Maryland, and federal law prohibits bookmakers from flouting that law simply because they are located outside the country. Many of the harms that underlie gambling prohibitions are exacerbated when the enterprises operate over the internet without regulation.”

This statement reflects exactly why so many legislators have recently been successfully arguing the need for state-by-state legalization. Their motivation is seemingly rooted in a desire to increase their state’s tax revenue in order to better fund critical programs like education – but the argument that best supports that effort is the need for regulation. Everyone agrees that countless U.S. citizens are engaging in online gambling each year, so it makes sense to many that states should protect these citizens by regulating online casino operators. At the same time, states could benefit by taxing the large amounts of money that at the moment are flowing into offshore accounts set up by companies that have figured out how to successfully game the system.

One has to think that if Bodog paid out over $100 million in winnings between 2005 and 2012, as the government alleges, the company must be taking in hundreds of millions, if not billions, in profits. Compared to this, the $500,000 fine that Bodog stands to receive as a result of the indictments looks more like a nuisance than a real punishment.

The possibility of prison time for Ayre and the three website operators is of course another story. Running an illegal gambling business carries with it a sentence of up to five years. To make matters worse, being found guilty of money laundering could land each of the four accused in prison for as many as twenty years. Arrest warrants have already been issued for Ayre, Ferguson, Philip and Maloney in conjunction with the indictments.