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

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

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

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

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