Internet Gambling Act Should Be Scrapped: Joe Saumarez-Smith

2007-10-19 00:06 (New York)

Commentary by Joe Saumarez Smith

Oct. 19 (Bloomberg) -- A year ago last Saturday, PresidentGeorge W. Bush signed the Unlawful Internet Gambling EnforcementAct and online gambling was banned in the U.S.

At least, that was the intention. Twelve months later,there are just as many people gambling online, if not more. Many bettors don't even know the law was changed, partly because it was tacked on as an amendment to a measure aimed at increasing port security.

The biggest difference now is that the companies offering online gambling are privately held and operate out of countries where it is impossible to know who controls them; if you had ahuge win, then the risk of not being paid is probably much higher. The major public companies that used to offer online betting to Americans, such as Party Gaming Plc, 888 Holdings Plc and Sportingbet Plc, all quit the U.S. market last October at a cost of several billion dollars to their shareholders.

America's banks and financial institutions were given 270 days from the passage of the law to block gambling transactions. The detailed rules on how to do this and how to spot a gambling transaction are still to be completed. As a result, online poker rooms, sports bookies and casinos are still able to get money from and send money to their customers, albeit not as easily as a year ago.

Meanwhile, Americans are free to place online bets on lotteries and horse racing as those forms of gambling were deemed legal. They can also visit any number of legal casinos, poker rooms, race tracks or Off Track Betting centers, and playstate lotteries.

The situation is, in short, a mess.

Unrealistic Bans

As America learned during Prohibition, some bans are unrealistic. The online gambling law shows that legislators weren't paying enough attention in history class.

At least Prohibition aimed to prevent the consumption of alcohol across the U.S. without exceptions. Banning some types of online gambling while allowing exemptions for lotteries and horse racing is protectionism of the worst kind.

The law criminalized those it described as being ``in the business of betting'' and made it illegal to handle money for the purpose of online gambling. That means individuals still aren't breaching any federal law by placing bets.

The daily number of poker players online worldwide was about 34,000 in September, down less than half a percentage point from a year earlier, according to Dennis Boyko at Poker Pulse.com in Vancouver. Poker players online in the U.S.have dropped only slightly, said Boyko, who has monitored the number of online players since January 2003.

Gambling Addiction

The law's supporters argued that banning online gambling would lower levels of gambling addiction.

``We do not see any decrease in the number of online gamblers seeking help, and anecdotally we see an increase,''said Kevin Whyte, executive director of the National Council on Problem Gambling in Washington.

``As with alcohol and drugs, prohibition of online gambling is one of the most ineffective ways of addressing a public health problem.''

The law may have made it harder for children to gamble online.

Dan Romer, research director of the Adolescent RiskCommunication Institute of the Annenberg Public Policy Center, said its annual survey shows a reduction in underage gamblers on the Internet.

``It is simply harder for children to get their bets on online because it is more difficult to deposit now,'' he said.


World Trade Organization

There is a small chance that the U.S. may be forced to repeal the law. The Antiguan government, which licensed many of the online sports bookies targeting the American market, has taken the U.S. to the World Trade Organization, arguing that anti-gambling laws restrict free trade. The WTO agreed, but the Americans have so far ignored the rulings. The U.S. may be forced to change its stance once WTO sanctions start to bite.

If legislators were brave, they would use the WTO ruling as an excuse to reverse the Unlawful Internet Gambling Enforcement Act and instead legalize and tax the online gambling industry. That would allow the U.S. government to know who was offering its citizens the chance to gamble, and to impose rules and restrictions that would prevent children and vulnerable groups from placing bets. It would also generate vast tax revenues.

Oddly, perhaps the biggest opponents of legalizing online gambling are the major sports leagues and organizations. TheNational Football League and National Collegiate Athletic Association are the most vocal of these, believing that betting may taint their sports.

Legalize It

The leagues ignore the fact that in pretty much every town across the U.S. you can place a bet at a local bar or barbershop and that the people who suffer financially when a game is fixed are the bookmakers, who have to pay out the winnings.

Almost all the point-shaving scandals of recent years have been uncovered because Las Vegas bookies noticed unusual betting patterns and pointed them out to the relevant authorities. If all betting could be done through legal channels, then these markets would be easier to police.

Laws that are either widely disobeyed or unworkable are bad laws. A year after its passing, the Unlawful Internet Gambling Enforcement Act is both disobeyed and unworkable.

The sooner it's scrapped, the better.


(Joe Saumarez-Smith is chief executive officer of SportsGaming, a U.K. management consulting firm to the gamingindustry. He also owns European online bingo companies and oddscomparison Web sites. The opinions expressed are his own.)

--Editors: Z. Smith (rjw/cus/smw).

To contact the writer of this column:Joe Saumarez-Smith at jssmith15@bloomberg.net
To contact the editor responsible for this column:Zimri Smith at +44-20-7330-7114 or zsmith@bloomberg.net

Harrah's Receives Approval From NJ Commission for Takeover

2007-10-17 16:35 (New York)

By Stefanie Batcho-Lino

Oct. 17 (Bloomberg) -- Harrah's Entertainment Inc., the casino company that last year agreed to sell itself for $17.1billion, said it received approval from the New Jersey casino commission for its takeover by Apollo Management LP and TPG Inc.

The transaction still needs to be approved by casino regulators in other areas, the Las Vegas-based company said today in a statement distributed by PR Newswire.

--Editor: Batcho-Lino (cmm).

To contact the reporter on this story:Stefanie Batcho-Lino in Toronto at +1-416-203-5723 or mailto:orsbatcholino1@bloomberg.net.

To contact the editor responsible for this story:David Scanlan at +1-416-203-5722 or dscanlan@bloomberg.net; Michael Nol at +1-212-617-2384 or mnol@bloomberg.net.

Harrah's Gets New Jersey Panel's Approval for Buyout ( Update 1 )

2007-10-17 18:09 (New York)

By Stefanie Batcho-Lino

Oct. 17 (Bloomberg) -- Harrah's Entertainment Inc., the casino company that last year agreed to sell itself for $17.1 billion, said it received approval from the New Jersey casino commission for its takeover by Apollo Management LP and TPG Inc.

The transaction still needs to be approved by casino regulators in areas where its facilities operate, the Las Vegas-based company said today in a statement. Spending in Atlantic City casinos declined 11 percent in September, the New Jersey Casino Control Commission said earlier this month.

Harrah's has casinos in 13 U.S. states, Ontario, Canada and Uruguay, according to its Web site. Harrah's rose 50 cents to $88.29 at 4:22 p.m. in New York Stock Exchange composite trading, and the shares gained 6.7 percent this year. The world's largest casino company has said its sale may be complete late this year or early next year.

--Editor: Batcho-Lino (cmm/cws).

To contact the reporter on this story:Stefanie Batcho-Lino in Toronto at +1-416-203-5723 ormailto:orsbatcholino1@bloomberg.net.

To contact the editor responsible for this story:David Scanlan at +1-416-203-5722 ordscanlan@bloomberg.net;Michael Nol at +1-212-617-2384 ormnol@bloomberg.net.

U.S. Gaming Revenues for Nevada and Las Vegas

2007-10-10 13:40 (New York)

By Alex Tanzi

Oct. 10 (Bloomberg)
The following table details the estimated fiscal year gaming revenues for Nevada and Las Vegas, in Aug., according to the State of Nevada Gaming Control Board.
=================================================================
Time Nevada YOY Las Vegas YOY LV Strip as a
Period Total % Chg Strip % Chg % of Nevada
=================================================================
FY 2008 $2,162.5 2.8% $1,138.3 4.6% 52.6%
FY 2007 $12,739.1 4.5% $6,753.9 5.7% 53.0%
FY 2006 $12,193.8 10.8% $6,391.7 14.6% 52.4%
FY 2005 $11,005.5 8.8% $5,578.9 9.6% 50.7%
FY 2004 $10,111.5 5.7% $5,091.7 7.7% 50.4%
FY 2003 $9,563.8 2.8% $4,726.3 4.3% 49.4%
FY 2002 $9,300.1 -3.7% $4,531.4 -7.0% 48.7%
FY 2001 $9,661.6 2.2% $4,874.7 2.7% 50.5%
FY 2000 $9,455.7 11.3% $4,745.8 15.2% 50.2%
FY 1999 $8,499.0 7.9% $4,120.5 9.6% 48.5%=================================================================
Note:
The Nevada Gaming Control Board fiscal year in July to June.
All gaming revenue data is in US$ millions.

SOURCE: Nevada Gaming Control Board http://gaming.nv.gov/mrrindex.htm#mrrindex
--Editors: Barrett

To contact the reporter on this story:Alex Tanzi in Washington at +1-202-624-1959 or atanzi@bloomberg.net

To contact the editor responsible for this story:Terry Barrett at +1-202-654-1252 or tbarrett1@bloomberg.net

Golden Gaming Proposes Destination Casino Resort in Wyandotte

2007-10-09 13:06 (New York)

Company plans world-class gaming-entertainment at I-70/110th Street

EDWARDSVILLE, Kan., Oct. 8 /PRNewswire/ -- Las Vegas-based gaming and entertainment company Golden Gaming, Inc., proposes an initial $600 million investment in a destination casino resort in Wyandotte County. Today the company filed planning and zoning applications for the project with the cities of Edwardsville and Bonner Springs.

Golden Gaming's proposed project will be located on 200 acres immediately south and adjacent to Interstate 70 at 110th St. The project spans Edwardsville and Bonner Springs within Wyandotte County and will bring significant benefits to all three jurisdictions.

"After looking at other potential markets nationally for our flagship property, we believe Kansas presents the best opportunity because we have an unmatched site and the best development plan," said Blake L. Sartini,chairman, president and chief executive officer of Golden Gaming.

"We are nothere as the largest gaming company competing for a Wyandotte County location,but as a mid-size gaming company best suited to giving this project the time,attention and focus it deserves. We look forward to partnering with the state of Kansas and Wyandotte County."

Plans call for a world-class development that will include a hotel, spa,restaurants, retail shops, convention and meeting space, an 18-hole championship golf course, entertainment venues and more. Golden Gaming has retained top hotel-casino planning and design architecture firm FriedmutterGroup Inc. of Las Vegas for the project.

"Our vision for Wyandotte County incorporates the culture, landscape and materials unique to the area with the latest in cutting-edge casino resort design," said Friedmutter's Director of Design, Albie Colotto.

Golden Gaming's executive management team has years of experience in jurisdictions throughout the U.S., including the Kansas City market.


About Golden Gaming, Inc.

Golden Gaming, Inc., along with its affiliate Golden Mardi Gras, Inc., operates three divisions:
Golden Casino Group, consisting of the Golden MardiGras Casino, Golden Gates Casino and Golden Gulch Casino in Black Hawk, Colo., the Pahrump Nugget Hotel & Casino in Pahrump, Nev., and manages casino operations for the Hard Rock Hotel & Casino in Las Vegas;
Golden Tavern Group, Nevada's largest tavern operator with 44 establishments; and Golden Route Operations (G.R.O.), Nevada's third largest slot route operator with more than2,500 machines in more than 200 locations throughout the state. Golden TavernGroup's Southern Nevada holdings include the flagship Sierra Gold brand and PT's Entertainment Group locations divided into three distinct brands; PT'sGold, PT's Place and PT's Pub. Golden Tavern Group operates under several brands in Northern Nevada including Sierra Gold, Sierra Junction, Sparky's Sports Bar & Grill and Gold Bar Casino. Each location features the exclusive and proprietary Golden Rewards player rewards program to its guests. Established in 2001, Golden Gaming, Inc., employs more than 2,200 team members throughout Nevada and Colorado and continues to position itself as a premier, diversified gaming operator of casinos, taverns and gaming devices.

For more information, please visit http://www.goldengaminginc.com/.

SOURCE Golden Gaming, Inc.

CONTACT:Jenell Loschke, +1-816-460-3086, or Jessie Pound, +1-702-737-3100,
or Christopher Abraham, +1-702-495-4322, all for Golden Gaming, Inc.