Gambling International online gambling

			HOME 	
			ARTICLES 				
			LIST NOW FOR FREE! 
			ABOUT US 
			CONTACT US 
			LOG IN			
		

International online gambling - pt 2
NASA occupies two floors in the downtown San Pedro mall. Its 30,000square- foot office includes a day-care center, gym, cafeteria and a plush-carpeted living room equipped...

Go to Web Site

NASA occupies two floors in the downtown San Pedro mall. Its 30,000square- foot office includes a day-care center, gym, cafeteria and a plush-carpeted living room equipped with a 60-inch television. Champion's spacious office offers a scenic view of the central mountain range.

"Our sales have tripled every year," says the 41-year-old Champion, who refuses to discuss dollar amounts. "During a big sporting event, phones generally ring off the hook."

Champion, who moved his sports betting operation from the Caribbean island of Aruba to escape that island's hefty phone bills and lack of office space, hopes his luck won't run out anytime soon.

Jose Manuel Echandi, president of the Social Protection Board, the government agency that operates the national lottery, argues that online gambling is illegal since the nation's Gambling Law of 1922 grants the government a monopoly over lotteries and, hence, all gaming activities. In 1997, his agency filed charges against three offshore companies. Those cases are still pending.

Many legislators here agree that the current law is outdated when applied to the Internet. "The spirit of the law says it is illegal," says Rafael Arias, a congressman for the National Liberation Party. "But they [Internet gaming entrepreneurs] take advantage of loopholes."

Sports websites register as data processing companies and virtual casinos argue they respect the governments monopoly by using filters to weed out local Internet providers and keep ticos, as native Costa Ricans are known, from placing bets. "Anything that isn't clearly designated as illegal is considered legal," says Costa Rican Rolando Soto, a veteran corporate lawyer.

But that could all change suddenly if the U.S. Congress passes a bill called the Internet Gambling Prohibition Act, says Soto, who predicts Costa Rica would follow suit.

Champion and his colleagues are hoping that day never comes. In fact, they are counting on the Costa Rican government to legalize online gambling. Most Internet betting executives say a ban would be futile, and they may be right. A recent report by the River City Group, a Missouri-based interactive gaming commission, predicts the industry will continue to grow with or with out a U.S. stamp of approval.

"It's ridiculous for the U.S. government to blackball Internet gambling, which is here to stay," says one Costa Rica-based online casino operator who asked not to be identified. "Everyone knows you can't stop the Internet. Instead of shunning it, they should regulate it."

Anyone care to wager on that?

G-MEN GO GLOBAL

IN JUST A FEW YEARS, THE INTERNET GAMING INDUSTRY HAS GROWN from a handful of operators to some 700 today. Currently, there "are about 47 countries where online gambling is sanctioned and regulated in some form. The most popular destinations are Caribbean Islands such as the Bahamas, Aruba, St.Kitts-Nevis, Curacao and the Dominican Republic. But Costa Rica, with an estimated 125 sites, is arguably the nation with the most Internet gaming ventures.

In the United States, however, online gambling is considered an illegal activity under the 1961 Federal Wire Act, which prohibits interstate or foreign gambling via phone or telegraph. The Internet Gambling Prohibition Act, authored by Sen.Jon Kyl (R-Arizona) would update the law and could come up for vote sometime this year. It would give the feds more authority to enforce Net restrictions and negotiate with foreign governments to extend the law outside the United States.

Currently, there are no penalties for online gamblers but those who offer such services could go to jail for up to five years and pay a US$250,000 fine.

In 1998, the FBI launched its first federal crackdown, ending in the indictments of 14 website managers--later raised to 21--of six online gambling websites. They were charged with luring U.S. customers through magazine advertisements and then using U.S. telephone lines to bet on football, basketball, hockey and baseball games.

Those indicted included Jay Cohen, who has become the industry's cause celebre. Cohen the president and co-owner of the Antigua-based World Sports Exchange, is believed to be the first person to go to trial under the law. In February, a U.S. District Court in Manhattan found him guilty of breaking the federal wire law. Cohen's lawyers have argued that he operated a business where online gambling is legal and, hence, broke no law. At press time, Cohen was scheduled to be sentenced in late May.

The feds may also soon find an ally in major banks and credit card companies. Late last year, Providian National Bank, the sixth-largest Visa card issuer in the United States, announced it would deny approval for most online wagers made by its customers-- after the bank negotiated an unusual lawsuit.

The bank was forced to cut a deal with Cynthia Haines, who used a Visa and MasterCard to gamble away more than $70,000 over the Net from her home in California. When she couldn't pay, Providian sued.

Haines then counter sued claiming the bank and credit card companies were at fault for letting her gamble with credit in the first place. Her suit also claimed that Internet gambling debts couldn't be collected in California because the wagers are illegal. Providian, Visa and MasterCard eventually struck a deal and agreed to clear her credit rating.