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With the state struggling to make ends meet -- a struggle that generally includes new or increased taxes on residents -- the last thing anyone needs is a drop in state revenue.

But it looks like that might happen. Casino revenues dropped in January, and gaming experts are predicting a yearlong drop of 5 percent or more as competition with other states heats up.

A 5 percent drop would mean Trenton lawmakers would have about $24 million less to work with next year.

Lawmakers could do the logical thing and cut $24 million in state spending. But New Jerseyans know all too well where that money will likely be made up -- tax hikes.

But there is another eventual possibility for increased state revenue: sports betting.

Atlantic City needs to offer options the Pennsylvania slot parlors can't. Sports betting is a money-maker in Nevada. Allowing it in Atlantic City would give Northeast gamblers a unique draw in this state.

There's no excuse for state legislators to drag their feet on this, especially since it may take a long time to bring sports betting to Atlantic City with either an act of Congress or a federal court decision needed to clear the way.

Source: Camden Courier Post

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After San Carlos professional poker player Jim Rashleger lost $600 as part of a federal action against online gambling this year, he took what seemed to him the logical step to continue his profession. He got out of the house and traveled to the card rooms.

“My advice for anybody right now is to not play online anymore,” Rashleger, 58, said. “I’m just going to go play at casinos. It’s more lucrative that way anyway.”

People such as Rashleger, a retired construction worker, have local card room owners paying attention to see if the fallout from the Unlawful Internet Gaming Enforcement Act of 2006 will benefit them. Results so far are mixed, with the owners of Colma’s Lucky Chances card room saying they’ve seen a business increase that they think may be related, while staff members at Artichoke Joe’s card room in San Bruno and Garden City Casino is San Jose say increased television publicity for poker is more responsible for new players filling the seats.

Rashleger may still get his money back, but he doesn’t know when or how much. He formerly played poker online at UltimateBet.com, with Isle of Man-based firm Neteller.com acting as the financial intermediary. In January, the U.S. Attorney’s Office for the Southern District of New York began a court-ordered seizure of up to $55 million of Neteller’s funds as part of its investigation against the company’s two founders. The firm said in a release this month it cannot pay back its customers’ money until an unknown future date.

It also ceased U.S. business operations in January, the result of the federal act introduced by then Senate Majority Leader Bill Frist and signed by President George Bush in October 2006. The act disallows electronic banking transactions related to online games of chance, and has prompted a massive pullout of online gambling companies from the U.S. market.

Rashleger disagrees that poker is a “game of chance,” rather than skill, but is taking his business to San Jose’s Garden City anyway. He said he chose that card room because it has more players and smaller-stakes games than other card rooms.

At least one local card room believes there are others like Rashleger coming in the doors.

“They have seen an increase in business, and believe it to be a result [of the act],” Lucky Chances attorney Harlan Goodson said. “They do believe it is attributable to the clamping down on Internet gaming.”

Others aren’t so sure.

“It’s totally speculative and anecdotal,” said Frederick Wyle, the Chapter 11 trustee for Garden City, which is moving out of an eight-year bankruptcy. “It’s very difficult for us to pinpoint an interest in business on any particular cause. We’ve heard that [online gamblers may be coming in], but we’ve also heard that people who want to continue online gambling find ways.”

He said the business has increased slightly recently, but attributes a greater overall business over the last six months or more to television shows about poker.

San Fransisco Examiner

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With Pennsylvania slots in operation barely two months and Maryland officials wavering on whether to push for the one-armed bandits this year, at least one Delaware legislator believes now is the time for the state to play its trump card.

State economic officials have projected a downturn in video lottery revenue, which has bolstered state coffers by more than $1.3 billion since its inception in 1995.

The expected loss of revenue, combined with a cash-strapped budget proposal that is dependent on the passage of a controversial cigarette tax, creates a perfect storm atmosphere to reintroduce sports betting in Delaware, said Rep. William A. Oberle Jr., R-Newark.

"Given the economic situation - particularly on the capital end - the timing is good to begin to address this," said Rep. Oberle, who has been pushing for the state to explore sports betting for several years.

Rep. Oberle said he is gathering information about the economic impact sports betting could have on Delaware and its tourism industry and intends to introduce legislation this spring to re-establish betting.

Sports betting, or sports gaming, has been a topic of discussion for years, with advocates claiming it could provide the First State with a competitive edge that no one could beat.

Delaware is one of only four states - and the only one east of the Mississippi River - grandfathered from a 1992 federal law prohibiting sports betting. Montana, Nevada and Oregon are the others excluded from the law.

Delaware's lottery had a sports game in 1976 and the state constitution allows sports betting.

Supporters lining up

Allowing sports betting is the state Video Lottery Advisory Council's top suggestion, said panel chairman Edward J. Sutor, who also is Dover Downs Hotel & Casino vice president and chief operating officer.

"It's a terrific marketing opportunity to be able to have an East Coast monopoly," Mr. Sutor said. "It's a marketing dream.

"Other states would give their right arm to have that advantage."

That unique advantage, he said, would give Delaware's slots an edge to counteract the strides surrounding states are making in the gambling industry.

Pennsylvania's slots are up and running, he said, while Maryland has been discussing the issue recently.

West Virginia is inching toward approving table games - such as blackjack, roulette and poker.

"When is the right time to (pass legislation)?" Mr. Sutor asked.

"Once legislation is passed, we can't start (with sports betting) immediately. You have to write rules and regulations and allow the casinos to build the facilities."

Stabilizing and strengthening the slots industry through sports betting would have an ancillary benefit for horse racing, said Salvatore DiMario, executive director of the Delaware Standardbred Owners Association.

Slots contributed about $67 million to horse racing purses in fiscal 2006 and have been credited with revitalizing the industry.

"We favor it, obviously," Mr. DiMario said. "It's a critical revenue stream.

"The engine that drives the horse racing industry is the purses. If the purse money is diminished, investment into horse racing is diminished proportionately."

That, he said, would have a ripple effect throughout the $280 million standardbred industry, including horsemen, farmers and trainers.

Source: Delaware State News

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Neteller, the online payment processing group, will trim about 250 jobs at sites in Canada and the U.K.

Around 220 jobs will be cut at the group's contact center and security operations in Calgary, Canada. Another 30 jobs will be lost in Britain when Neteller operations move from Gatwick to Cambridge in March.

Neteller said in a statement the job losses were the result of a "reorganisation and restructuring of its operations."

The company's services were used extensively for payments made to online gambling sites before a change in U.S. law last year made that type of transaction illegal.

Since then there has been a mass withdrawal of online gambling companies from the U.S., prompting Neteller to follow suit.

A Neteller spokesman said the job losses are a direct result of the recent changes in U.S. online gambling laws.

Since Neteller stopped processing payments for U.S. residents, transfer volume and customer enquiries have "decreased substantially."

"The company is looking to expand in Europe and in Asia in particular," a Neteller said of plans to grow the business following the withdrawal from the U.S.

The group will continue with its current business and has "plenty of product areas (it) can expand into," he added.

Source: ZDNet

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British online payment processor NETeller said it would shed 250 jobs, mostly in Calgary, Canada, following its withdrawal from the U.S. market.

"Staff reductions will total around 220 employees across all levels, from the group's contact center and security teams as well as related support functions in marketing, processing and IT," NETeller said on Friday of its Calgary-based operations.

The company is cutting 30 jobs in Britain.

NETeller quit the United States last month after U.S. authorities arrested its two founders and charged them with handling billions of dollars in illegal gambling proceeds.

"The events of the past months have led to challenging times for the group, and the board has taken these measures to ensure the group has a sustainable business going forward," said President and Chief Executive Ron Martin.

Internet gambling in the United States was effectively banned last October when President Bush signed legislation outlawing online gaming transactions.

Last week prosecutors seized some company funds, stopping U.S. customers from accessing their money, the latest move in the online gaming crackdown.

A spokesman for the firm said customers were still unable to access funds worth up to $55 million, and he could not say when the cash would be returned.

NETeller is cooperating with an investigation by the Attorney's Office for the Southern District of New York. Founders Stephen Lawrence and John Lefebvre no longer work for the firm but still have significant shareholdings.

"Its (the company's) hands are tied by the Department of Justice ... This is a probe into the two founders of the business, so it is not in any way affecting NETeller Plc," the spokesman said.

"But clearly at the same time, the DOJ has taken a very firm stance by saying you can not gamble online if you are a U.S. citizen. It is illegal, and you guys (the accused) have built a platform for many people in the U.S. to do that," he said, explaining the background to the seizure.

NETeller said rationalisation would also include a review of the group's property requirements and may involve the sale or partial lease of some of its Calgary-based facilities.

It reiterated that total cash costs associated with staff restructuring were expected to be around $1.1 million in 2006 and a further $3.7 million in 2007.

NETeller said its shares would continue to be suspended from trading on AIM in view of the continuing uncertainty. It requested its shares be suspended in January, just after the arrests.

Source: Canada.com

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Gambling software producer CryptoLogic Inc. said yesterday its fourth-quarter profit dropped 70.6 per cent to $1.7 million (U.S.) in its first financial performance report since the U.S. government declared a ban on online gambling.

For the ended Dec. 31, the company's earnings were equivalent to 12 cents per diluted share, down from $5.8 million, or 43 cents per share, in the same period last year.

Source: Toronto Star

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Nobody does a party like this gambling town, a big reason why the NBA picked it for an All-Star celebration that threatens to add a new definition to the word excess. There are so many A-list happenings on the glittering Las Vegas Strip that Sunday's game seems almost an afterthought.

It's the first time the NBA has held the annual exhibition in a city that doesn't have a team. Already there's talk about a return All-Star appearance in a few years.

What Las Vegas really wants, though, is something more permanent _ a team of its own. So far, the glitzy city has struck out trying to land one from the four major sports.

Las Vegas may have the biggest hotels in the world, including a $7 billion resort complex under construction that other cities could never match. But it still looks with envy at more sedate places like Indianapolis that have teams _ and titles.

"I think Las Vegas is the next great world city, and a component part of that has to be a major league team, be it NBA, NHL, baseball or football," said Mayor Oscar Goodman. "That's what makes great American cities."

A big part of the problem for Las Vegas is that other American cities weren't built on gambling. Other American cities don't have neighborhood casinos that make it as easy to bet on a game as it is to go to the supermarket for a gallon of milk.

Leagues already wary of betting scandals are even more wary of committing a team to play in a place where betting is not only tolerated, but encouraged.

"It's not about a moral crusade about gambling," NBA commissioner David Stern said when announcing the All-Star game would be in Las Vegas. "It's just about betting on basketball games."

To land the All-Star game, casino sports books agreed not to accept bets on it, a concession easily made since it's an exhibition that hardly anyone bets on anyway. The casinos, though, made it clear they won't do the same for an entire season.

Goodman has made it his mission in recent years to lure some sort of team to town, even going so far as to show up at baseball's winter meetings a few years ago with two showgirls and an Elvis impersonator in tow.

He's been rebuffed for both moral and financial reasons, but the fast-growing city now has a relatively affluent population of 2 million and might eventually prove so attractive that it can't be ignored.

Stern hasn't budged from his insistence that there be no betting on the NBA as a condition for any team to locate in Las Vegas. But he had no problem bringing the All-Star game to town and seems to have softened his stance recently by saying it would be a decision made by the owners.

Stern met with Goodman on Wednesday and signaled he may be ready to move further, asking the mayor to come up with a proposal to deal with the betting issue. Stern said he hoped to have the proposal in hand when the NBA's Board of Governors meets in April.

At least one of those owners believes the NBA will be in Las Vegas in a few years.

"I think within five years," said Gavin Maloof, whose family owns both the Sacramento Kings and the Palms hotel-casino in Las Vegas. "Certainly within the decade, absolutely. The city has too much going for it. It's very large, there's a lot of money here, there's a huge local population, and they love basketball."

The NBA isn't the only league hesitant to commit. Baseball flirted with moving the Montreal Expos to the city, but the betting issue and a better offer prompted the league to choose Washington, D.C., instead.

The NFL, meanwhile, is so unfriendly to the city that it won't even allow Las Vegas to be mentioned during the Super Bowl telecast, much less advertise on it. That policy apparently won't change under new commissioner Roger Goodell.

"I think it's a real issue," Goodell said earlier this month at the Super Bowl. "I have my personal views about gambling, and I don't think it's in the best interests of the NFL to have any association with sports betting."

The city's best hope for the immediate future might be the NHL, which is struggling with both attendance and television ratings and doesn't appear nearly as dogmatic about betting.

"Certainly there has been interest expressed since the lockout ended by people wanting to own a franchise in Las Vegas," deputy commissioner Bill Daly said. "At the appropriate time I think we have to look at that interest."

Daly said he believes an accommodation could be made on the betting issue. More important, he said, would be the willingness to build a new arena since the 19,000-seat UNLV campus arena where the NBA All-Star game will be played wouldn't satisfy a basketball or hockey team.

"It's an intriguing market for a host of reasons. The demographics are strong, there's wealth in the market and interest in the market," Daly said. "But it's essential there be a state-of-the-art arena before we have a franchise there."

That could be more difficult than getting casinos to stop taking sports bets. Local leaders formed a committee to study building a new arena, but there is little appetite for tax money to pay for one.

Casinos, for the most part, see a team as competition for the entertainment dollar, not a lure for tourists.

"There isn't a movie company in Los Angeles that would expect the government to pay another movie company to come to town. And we shouldn't be doing that for a sports team," said Alan Feldman, vice president of public affairs for the powerful MGM Mirage casino operator. "In this state and community we pay for everything. We get no breaks."

Pro teams and big-time athletes are no strangers to Las Vegas. The U.S. Olympic team made up of NBA stars trains in the city and will host an Olympic qualifier this summer, while Michael Jordan, Charles Barkley and Tiger Woods are regulars in the casinos.

Kareem Abdul-Jabbar broke Wilt Chamberlain's career scoring record in the city in 1984, when the Utah Jazz played 11 games at the UNLV arena, and the Oakland A's played their first six home games of the 1996 regular season in Las Vegas.

Maloof said he isn't planning to move his family's team to Las Vegas, despite arena problems in Sacramento.

Still, he said, he believes the city needs a team to be complete.

"There needs to be one of the four major sports," Maloof said. "All I can say is that Vegas has everything, yet it has nothing when it doesn't have sports. There really is a need for it."

Source: Times and Democrat

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Liberty Media's deal to acquire Major League Baseball's Atlanta Braves could hit a hitch because the Douglas County-based company owns one of the Internet's premier sports-betting information website.

Liberty's ownership of DonBest .com - which provides gamblers with betting lines, "expert" picks and other information to help them win money on sporting events - presents a conflict of interest, said sports-business expert Dave Smrek. Only one or two of the experts rise to the level of OffshoreInsiders.com stable of handicappers.

"I think Major League Baseball would have to take a long, hard look at it," said Smrek, principal of Denver-based Adrenalin, a sports-consulting firm. "In one way or another, it needs to be addressed."

Liberty's agreement to acquire the Braves from Time Warner as part of an asset swap requires approval from 75 percent of major-league team owners.

Major League Baseball has long abhorred its teams' having ties with gambling operations. MLB spokesman Rich ard Levin said Wednesday he couldn't comment about what impact Liberty's interest in DonBest might have on the approval process.

In response to an e-mail questioning DonBest's operations and its potential impact on the Braves deal, Liberty spokesman John Orr wrote, "We have no comment." DonBest is operated by Toronto-based Fun Technologies. Liberty paid $195 million last year for a 51 percent stake in Fun.

Described in a 2003 New York Times article as the "Bloomberg of sports betting," DonBest charges users $600 a month for up-to-the- minute betting odds on games in every major sport, including baseball.

"It's definitely the No. 1 sports-betting-line service online," said gambling expert Ken Weitzner, president of EyeOnGambling.com. "There's not even a close second; it's that popular."

Betting on major sports such as baseball in the United States is legal only at casino sports books in Las Vegas.

DonBest features betting lines from offshore sports books such as TheGreek.com and Sportsbook.com. The U.S. Department of Justice last year launched a major crackdown on online gambling, arresting executives of sites such as Bet OnSports.com while they traveled in the U.S.

It's unclear whether DonBest, which hasn't been targeted by the U.S. government, receives revenue from illegal sports-betting websites.

"Obviously, any direct ties with illegal gambling presents a problem for baseball," said Levin, the MLB spokesman.

DonBest also offers picks from its sports experts that are guaranteed to make money for users or they don't have to pay the fees, which range from $25 to $40 per package of daily picks.

Liberty shouldn't have a problem divesting DonBest if it is asked to do so to get the Braves deal approved, Smrek said. "For them, this is a pretty small play," he said.

Source: Denver Post

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The waiting game for thousands of U.S. patrons with money tied up in an online payment service under federal investigation just got longer.
The U.S. Attorney's Office for the Southern District of New York late Wednesday said it extended the deadline until March 16 to decide whether to indict the co-founders of Neteller, an Internet money-transfer service popular among gamblers. Stephen Lawrence and John Lefebvre were arrested in January on a charge of conspiracy to transfer funds with the intent to promote illegal gambling

For U.S. customers of the site, it was another delay in their efforts to recoup their money, which remains in Neteller accounts until the legal matter is resolved.

Neteller says U.S. authorities have frozen access to about $55 million in U.S.-based accounts.

"As a result of the restrictions placed by third parties, court-ordered seizures and related legal concerns, (Neteller) is unable to make payments to U.S. customers," says a posting on the company's website.

FBI agent Neil Donovan has said funds are being held in court as potential evidence. He did not provide a timetable on when customers may get their money back.

Though money-transfer companies such as Neteller do business with financial institutions and merchants, many also allow gambling companies to transfer money collected from U.S. gamblers to bank accounts outside the USA. Neteller last month closed its U.S. Internet gambling services, erasing about two-thirds of its business.

A law signed by President Bush in October bans the use of credit cards, checks and electronic fund transfers for Internet gaming. U.S. residents place more than half of all bets to major offshore casinos in an estimated $10.6 billion industry. However, most online gaming sites are based offshore, outside the reach of American law enforcement.

With Neteller's financial future teetering in the balance, consumers might choose less reliable money-transfer services instead, says Ken Dreifach, an Internet attorney.

Source: USA Today

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