Gambling & Entertainment Blog

Greek horse betting CEO released from jail; RGA plans new legal complaint
The CEO of Greece?s state-run horse betting monopoly has been released from jail after being arrested early last week. Alexandros Zaharis, head of the Hellenic Horse Racing Company (ODIE), was detained as part of the government?s get-tough program on tax scofflaws. The state claims ODIE owes them ?83m in debts and another million in allegedly withheld taxes and dues. Greece has made over 4,000 such arrests in the private sector, but the Associated Press reported that Zaharis is the first official at a state-affiliated firm to be charged. Zaharis was released pending trial and given a month to settle his accounts. If convicted, he faces a minimum five-year stint in jail. Zaharis? lawyer claims ODIE has since paid ?200k of the withheld taxes. Like everything else in Greece, ODIE is slated for privatization, having announced last week that it would sell off its betting and real estate assets separately. Also scheduled to go on the block is the state?s 34% stake in betting group OPAP, although the process of bringing that pig to market seems to be taking almost as long as it took Axl Rose to record Chinese Democracy. Nevertheless, the chairman of Greece?s privatization agency maintains the tender will happen in Q1. Ioannis Koukiadis told Reuters that there were ?a series of issues involved in the completion [of the sale] which are not time-bound. I want to believe we won?t have any problems as there is strong interest.? Interest has reportedly been tepid in the country?s new online gambling licenses. A source told eGamingReview that just four operators have received interim licenses thus far: Goldbet.com, Championsbet.net, Casinostar777.com and one other unidentified operator. The deadline for applicants to submit their paperwork came and went this week, but many large operators chose to take a pass, put off by the requirement to fork over two years worth of back taxes. The Remote Gambling Association (RGA) is planning legal action challenging the new Greek gambling law, which it views as state aid. The RGA has already complained to the European Commission (as has the European Gaming and Betting Association), but this new RGA action will take place in a Greek court. The RGA will try to convince the Greek legislature to play ball before the Feb. 14 deadline. If Greece?s demand for two years retroactive tax seems a bit desperate, it?s the prevailing mood. The debt-laden country could sell pretty much everything they own and turn the Parthenon into a McDonald?s, but it probably wouldn?t be enough to put their national finances in order. Greece defaulted on its foreign debt five times over the past two centuries, but this would be the first time with the euro as its currency. Nouriel Roubini, the New York University economist dubbed Dr. Doom for his unheeded warnings that the global economic crisis was looming, describes the eurozone as ?a slow motion train wreck.? Speaking at the World Economic Forum in Davos, Roubini predicted 2012 would see the departure of Greece from the eurozone, with Portugal following the year after. Roubini puts the odds on a complete breakup of the eurozone in the next three to five years at 50%. If the future of the European financial system rides on a coin flip, Greek gambling laws will be the least of operators? problems. Business News

Graphic health warnings not only fail to curb abuse, they may increase it
Democracy Institute founding director and CalvinAyre.com contributor Dr. Patrick Basham recently co-authored (along with Democracy Institute senior fellow Dr. John C. Luik) a working paper titled Health Warnings on Consumer Products: Why Scarier Is Not Better (you?ll find a link to the full PDF at the bottom of Basham?s bio page here). The thrust of the paper was that state-sponsored scare tactics on consumer product health issues ? such as graphic warning labels on cigarette packs ? are not only ineffective, they may be counterproductive. Basham and Luik relate how numerous studies have shown that such campaigns ultimately fail because (among other things) consumers tend to avoid processing info that has negative self-implications. Worse, the fear inspired by such warnings prompts the consumer to develop a defense mechanism that rejects the truth of the warning. Even more damning, studies show that when an individual?s freedom to engage in a particular behavior is threatened or eliminated, the individual?s desire to engage in said behavior only intensifies. Studies have also found that oversimplification and exaggeration of a supposed danger produces a ‘Reefer Madness Response’, named after the infamous 1936 film in which marijuana was depicted as leading to insanity, murder and extremely fast piano playing. Does anyone else hear echoes of the ?click your mouse, lose your house? mantra that spews from the mouths of anti-gambling crusaders? (If not, ask that reefer-smoking pianist to cool it for a moment.) Basham and Luik recently penned a similarly themed op-ed in the New York Daily News examining that city?s fear-mongering campaign against Type 2 diabetes brought on by excess consumption of sugary sodas. Subway riders were confronted by posters of a man whose diabetes had supposedly led to his leg being amputated, except the absent leg turned out to be caused by Photoshop, not diabetes. D?oh. This would be more amusing if the journal Nature hadn?t published a position paper just this week suggesting that sugar was a toxic substance that required regulating in order to temper consumption. That?s right ? you might soon have to produce photo ID to get your Krispy Kreme fix. The dubious efficacy of fear-mongering consumer health warnings isn?t the only aspect that concerns Basham and Luik. The pair also suggest such efforts, which transcend simply relaying public health information to become instruments designed to influence public behavior, are ?fundamentally at odds with three core democratic values: autonomy, respect and freedom of expression.? Now, if you?ll excuse us, we?re going to freely express our desire to, uh, tinkle the ivories (nudge nudge, wink wink). Lifestyle News

OLG extends online gaming supplier bid deadline; Toronto casino support tepid
The Ontario Lottery and Gaming Corp. (OLG) has extended its deadline for companies to submit bids to supply the provincial gaming authority with online gambling technology. OLG rolled out the welcome mat for bids in early December, but only three companies ? GTECH G2, OpenBet and Amaya Gaming ? got their bids in before the Feb. 3 deadline. According to a report in eGamingReview, nine other companies requested that the deadline be extended so they could finish adding pictures of beavers and hockey players to their PowerPoint presentations. It?s not known how long of an extension these laggards have been granted, but once all the bids are in, OLG is expected to take seven weeks to consider each proposal, emerging with a short list of companies OLG reps will then visit in person, followed by actual contract negotiations with the perceived frontrunner. OLG is not expected to make its final decision before summer 2012, with a partial product launch anticipated by the end of the year. It?s likely no coincidence that the three bidders who managed to turn in their homework on time already have a presence in Canada. OpenBet supplies online gaming platforms to provincial lottery outfits in British Columbia and Quebec and made a recent foray into the Maritime provinces via a deal to supply the Atlantic Lottery with sports betting software. Canadian-based Amaya recently got even more Canadian via its bid to takeover Dublin-based (but Toronto-born) Cryptologic. GTECH G2 is one year into a five-year contract to supply Loto-Quebec with the backbone of its Canadian Poker Network (which BC joined a year ago). In Ontario brick-and-mortar gambling news, a proposed casino in Toronto is receiving mixed support from residents of Canada?s largest city. A Forum Research poll found 50% of respondents were against adding a casino to the city?s gambling options, with 36% in favor and the remainder having no opinion. The highest levels of casino opposition came from women (55% opposed) and senior citizens (59% agin? it). Two sites have been floated as front-runners to host the new gaming establishment: the 197-acre Exhibition Place facility near the shoreline of Lake Ontario, and the Woodbine racetrack in the city?s west end (where slots are already in operation). City councillor Giorgio Mammoliti thinks both locations should be given a casino, but this opinion is considered a very long shot. OLG president Rod Phillips told the Toronto Sun that part of the motivation to construct a casino in the city was to serve the needs of local customers, rather than serve as a tourism attraction. OLG operates casinos along the border with the United States, but a perfect storm of conditions — the Canadian dollar?s rise to parity with the greenback, the institution of mandatory passport requirements at border crossings and the construction of casinos in US border states — has resulted in OLG?s border casino contributions to the province falling from $800m to $100m over the past decade. Nevertheless, politicians representing ridings with border casinos are expected to mount fierce opposition to the possibility of any new competition. To this, Mammoliti says tough tittie. ?It?s time for Toronto to get some help here. We?re suffering. And it?s time that everybody consider us for a change.? Business News

Lib Dem MP Tessa Munt slams pop star Robbie Williams over online poker site
Liberal Democrat MP Tessa Munt has slammed UK pop singer Robbie Williams over Williams? plan to launch a free-play online poker site. Munt, last seen trying to get the communications industry regulator to crack down on the number of gambling ads on the Munt family telly, claims to be ?absolutely outraged? by the ?deplorable? RobbieWilliamsPoker.com site. The site is powered by Pokermania, the German b2b media & marketing outfit that also provides social gaming ?casual poker? software, and is currently in beta release. Robbie?s site may be free-play, but there are options to buy virtual chips. This, apparently is what set Munt?s phaser on ?kill?, plus the fact that the site was being promoted via email to Robbie?s registered fan base. Evidently convinced that Robbie?s fans are the same doe-eyed pre-pubescent girls who followed his insipid but mega-selling boy band Take That in the mid-90s, Munt said ?young people are hugely susceptible to this sort of advertising and I am totally opposed to it. It directly targets his fans, including a new generation of children.? Since embarking on a wildly successful solo career, Williams has become a UK tabloid mainstay, especially as he dealt with various forms of addictive behavior. He?s now pushing 40, and his fans have grown up/old along with him, so a free-play poker site hardly seems worth protesting. But Munt maintains that there?s ?no excuse for doing this ? I hope he puts every single penny he makes from it into addiction charities or to help victims over this kind of problem. I’m very surprised he is doing this. I think it is awful.” Following Munt?s missive, Robbie?s spokesman told the Daily Mirror that the online poker plan was in the early stages and that the site?s ?main focus is not money.? Munt better brace for more blowback. Robbie is a well-decorated veteran of some very public wars of words with various UK celebrities over the years, including Oasis? Gallagher brothers, with whom Robbie temporarily became BFFs following his decision to quit his boy band. Then came a nasty falling out over who snorted the last rail (or something), which led to the Gallaghers describing Robbie as ?the fat dancer from Take That,? which in turn led Robbie to publicly challenge Liam Gallagher to a £200k boxing match. We doubt Robbie would hit a girl, so perhaps Munt?s off the hook. Regardless, our feelings on the whole brouhaha can be summed up by Noel?s comment at the end of this video? Business News

MGM, Boyd apply for Nevada poker licenses; Bwin.party's Ryan talks Germany
MGM Resorts and Boyd Gaming are the latest candidates seeking the right to offer online poker in Nevada (and across the USA, if Nevada Senator Harry Reid has anything to say about it). CardPlayer claims to have obtained information that both casino companies have submitted applications to the Nevada Gaming Control Board for consideration to be granted online poker operating licenses. Combined with Caesars Entertainment, Fertitta Interactive, South Point Poker and Monarch Casino & Resort Inc., fully half of the total 12 GCB applicants are looking to earn some sweet operatin? money. The six applicants seeking only the right to supply technology to the approved operators are IGT, Cantor Gaming, Shuffle Master, Bally Technologies, 888 Holdings and Aristocrat Technologies. Conspicuous by their absence on that latter list is Bwin.party (Pwin), which has entered into a joint venture threeway with MGM and Boyd, for which Pwin would supply the technology (and control 65% of the new US-facing entity). Pwin also retained the option to apply for its own operating license at some point in the future. As for why Pwin?s technology application wasn?t submitted along with MGM & Boyd?s paperwork, we can only speculate. Perhaps they?re waiting for the word Megaupload to fade from the headlines? Pwin co-CEO Jim Ryan recently sat down with PokerStrategy to discuss a wide variety of topics, including the future of US poker. Ryan said it was ?our expectation? that regulated US poker rooms would be ring-fenced from dot-com liquidity, yet Ryan also expects non-US players will be allowed access to US poker rooms. Ryan says 2012 will be the year that Bwin and PartyPoker finally pool their poker liquidity (a year after the two companies officially tied the knot), with the dot-com merger happening in ?early summer? followed by the addition of their Italian and French operations ?later in the year.? As for Pwin?s operations in Germany (which the German government and courts have repeatedly declared illegal), Ryan takes the view that ?the current state treaty and the proposed revised state treaty violate European Union law. We will therefore continue to offer our products in Germany as long as the German legal regime does not comply with EU law.? This is the same ‘foolish mortals, your weapons are useless against us’ approach Pwin initially took with regard to Belgian gaming regulators, only to do an abrupt about-face last month. (For what it?s worth, it?s also the stance PokerStars and other firms took in regard to the US gambling laws? non-compliance with WTO court rulings, which prompted Pwin execs to label these companies ‘criminals’, but we digress?) Pwin is pinning its German hopes on Schleswig-Holstein, the lone state that declined to join the other 15 in approving the new interstate gambling treaty, and which has proposed its own regulatory/tax plan that has garnered much love from international online gambling firms. This week, Germany?s federal government expressed concerns about the proposed 15-state treaty, stating that the European Commission may indeed find state aid issues to complain about. However, even if the treaty is rejected, that wouldn?t automatically clear the way for Schleswig-Holstein?s plan to go forward. Before any new gambling taxation scheme can be implemented, the federal 1922 Race Betting and Lottery law would need to be amended. Schleswig-Holstein has stated it intends to issue its first licenses by March 1, but with no guarantee that such a license would be regarded as legal by the federal government, many companies not named Pwin are adopting a wait-and-see attitude. Business News

Five on Friday: Light at the End of the Tunnel
When you?ve been stuck in a dark tunnel for a long time, seeing a light suddenly appear at the end is a tricky thing. On the one hand, it?s a light! That alone is reason enough to get excited. On the other hand, it?s just a light and you?re still in a tunnel. You don?t know the light?s source – it could be an exit, sure, but it could also be something not nearly as beneficial to you. And then there?s the fact that you don?t know how far away the light actually is. You could keep crawling for years and never reach that light. Now that February is here, we?re beginning to close in on the one-year anniversary of Black Friday. The political landscape in the United States with regard to online poker has changed a lot since then, going from ?aligned against all things poker? to ?hey, we can make a lot of money off of this? in the span of just a few short months. Nowhere has this political shift been more pronounced than in the state of Nevada, where the biggest gaming companies in the world are headquartered. The American Gaming Association, which represents most of those companies, has historically been opposed to the expansion of gambling into cyberspace. But few states have been hit as hard by the American financial collapse as Nevada, so the opportunity to seize a proven market led the AGA to change its stance. Then in late December of last year two things happened to tip the balance toward legal online poker. First, Nevada passed a law to allow online poker within its borders should the federal government decide to allow such a thing within the United States. Then, a few days later, the Department of Justice released an opinion that the Wire Act of 1961 – which it has historically relied on as a basis for its anti-online-gambling stance – only applied to sports-betting. Advantage: Vegas. In the absence of any federal actual law prohibiting online poker, the DOJ?s opinion on the Wire Act was enough reason for talk to start up again in several other states about legalizing and taxing the shit out of online poker. Of course, it?s not as simple as just saying ?it?s legal!? or Americans would already be back to playing online by the millions. The brick-and-mortar gaming industry is going to want to be protected against competition, a goal that will be accomplished through the regulatory process. Local, state and federal political entities of all sorts are going to want to get their due – for the state through those same regulatory processes, and for themselves individually through campaign contributions and other means. And then there?s the matter of sorting out the business of what to do with those who weren?t willing to wait for a government imprimatur to jump into the online gambling business. In other words, it?s going to take some time before Americans are playing online poker on AGA members? servers. There are still miles of road to be traveled, and a lot can happen between here and there. The past two weeks saw five stories emerge that gave us a slightly better, though not crystal clear, idea of how far away the light at the end of this particular tunnel really is. 1. Nevada online license applications continue to pile up The number of corporate entities that have requested permission to play ball went up by two late this week when MGM and Boyd Gaming filed their applications with the state to become fully licensed operators in the coming Nevada online poker market. Both companies applied as Operators, one of the four categories eligible for a license. (The other three are Distributors, Manufacturers and Service Providers.) On the heels of their October online poker deal with Pwin, this could very well signal confidence from MGM and Boyd that Pwin is going to win approval from Nevada when it eventually applies for a license. Then again, they might be preparing to do business with another Service Provider altogether. For now, 12 companies – including Nevada?s MGM, Boyd, Caesars, Monarch Casino, South Point Poker and Fertitta Interactive – have filed for consideration by the state, which still has not released a timeline for issuing of licenses. 2. Ferguson supports Tapie deal Former WSOP Main Event winner Chris ?Jesus? Ferguson was one of the central figures named in US Attorney Preet Bharara?s indictments against Full Tilt for defrauding poker players of $440 million. If Ferguson?s latest dealings are any indication, that kind of money helps you lawyer up pretty well. Ian Imrich, Ferguson?s attorney, told Card Player this week that his client expects to have his case settled early this year – not bad for one of the supposed masterminds of a ?global Ponzi scheme.? Along the way, Imrich took exception with a Subject: Poker report last week that Ferguson was threatening the closure of the Groupe Bernard Tapie deal by seeking reimbursement for millions of dollars in Full Tilt?s post-Black Friday expenses. Instead, Imrich said that Ferguson was requesting an accounting of any money that CEO Ray Bitar may owe to Ferguson. ?In short,? said Imrich, ?Chris? request has nothing to do with Tapie or the agreement reached with [Full Tilt] and DOJ, which my guy supports.? 3. Ivey, Lindgren, other pros owe Full Tilt millions So what is holding up the GBT-Full Tilt deal, then? Could it be the money owed to the site by some of its former sponsored pros? Card Player reported this week that a number of poker players, including Phil Ivey and Erick Lindgren, collectively owe $18 million to Full Tilt Poker. Ivey and Lindgren reportedly owe the site $4 million each. David Benyamine and Layne Flack both reportedly owe $2 million, while Barry Greenstein, Mike Matusow and others are said to owe smaller amounts. Greenstein quickly took to 2+2 to explain his debt, but no one else has stepped forward with any sort of explanation of their situation. An attorney for Groupe Bernard Tapie told PokerStrategy.com that if ?the money doesn’t come in, it creates a serious obstacle to completion of the deal,? and that the players? debts aren?t ?the only issue with the takeover,? but that they are ?substantial.? It?s unlikely the deal will be scuttled over an issue of this size – but GBT certainly seems to have a handle on using it as a bargaining chip. 4. Senate hearing scheduled – in Indian Affairs Committee One group with a serious stake in a future American online poker market is the numerous Native American tribes that operate casinos throughout the U.S. They get the least attention when people start talking about, but outside of the Las Vegas corporate interests they?re the ones who have had the most impact on Washington?s discussions of online poker. Both of the Congressional online poker hearings in 2011 were led by Rep. Mary Bono-Mack, whose district includes seven Indian casinos, and the National Indian Gaming Association?s Ernest Stephens was the first witness to testify before her committee. Now the senior legislative branch is also using the tribes? lens to examine at the issue, in the form of a Feb. 9 hearing before Senate Committee on Indian Affairs. As Mr. Stephens made clear in his testimony last year, the tribes do not plan to roll over and give up their hard-won foothold in the casino business as it transitions to the internet – and that means the tribes will be a major force in the future of American online poker. 5. Jon Kyl getting his Perhaps no figure still active in the U.S. government today has had as much influence on the current state of the American online poker market as the senior senator from Arizona. Kyl?s been an anti-gambling warrior for decades, and along with former Tennessee senator Bill Frist he was one of the major forces behind UIGEA. Since then he?s also been a stumbling block in the Senate, where the gaming industry?s best friend, Harry Reid, is in charge of setting the agenda. Now down to his last year in office, Kyl appears to be signaling his willingness to deal with Reid on allowing online poker legislation, telling the National Journal that ?Quite possibly something will be done? with regards to online poker this year. This is Kyl?s last chance to wring some private benefits (such as a legacy that impacts the online gambling industry in America) out of changing his position, so it?s not terribly surprising for him to strategically shift. Whether or not that translates that into a win for Vegas concerns is another matter, but Kyl is getting his and bodes well for Reid, too. So what?s the upshot of all these stories? On one hand, we?re still stuck in a tunnel. On the other hand, we?re closer to the exit than we were just a few weeks ago. Take all that for what it?s worth when you?re trying to figure out what to think about that light in front of us. Poker News