FBI Shuts Down Poker Stars, Absolute Poker and Full Tilt

17 April 2011

LONDON--(BUSINESS WIRE)-- Following the issue of arrests warrants by the FBI and the US Justice Department on persons connected with Poker Stars, Full Tilt and Absolute Poker the time has come to reflect on where the online gambling industry is heading.

Following the passing of the Unlawful Internet Gambling Enforcement Act (UIGEA) we saw a significant weakening of the stock exchange quoted companies as they grappled with a negotiated settlement with the Justice Department in New York and having to target a completely new market in Europe and elsewhere.

The irony is that the US federal government has been planning to introduce poker legislation and various states such as Nevada, California, New Jersey and Florida have been planning to jump the gun with intrastate legislation.

Events of the last few days justify Party Gaming’s stance on settling with the US and they are likely to be the main beneficiary assuming they will eventually win a license in the USA.

Concerned gamblers are tweeting on Twitter expressing concern about their player deposits being held by Poker Stars, Full Tilt and Absolute Poker.

The arrests in the USA are a game changer - no question. We are moving toward a global high tax, lower profit, and high regulatory regime. Some countries will be slow to join but as markets close down competition in countries such as Italy, France, Germany operators will target those that remain giving rise to complaints from land based operators who will see market share fall. As government tax revenues decline those countries will act and join the high tax high regulation club.

The so called grey market where a lack of law prevents the closure of Internet gambling companies will eventually disappear. The market will be black or white.

It was not so long ago that e-gaming executives were sitting on CEO panels at conferences saying “We want to come on shore” and “Yes, please tax us and let us apply for licences”. They could not have imagined in their wildest dreams (nightmares?) it would have been like this.

GBGC has established itself as the most credible specialist international gambling consultancy in the world. The company has work with or supplied information to over 400 clients the majority of whom are 'blue chip'.

In addition to its consultancy GBGC has produced five reviews of the global gambling market that have been widely acknowledged to be the best available both in terms of both their detail and accuracy. The latest Global Gambling Report was published in April 2010 and extends to over 1,450 pages, covering more than 250 individual markets on every continent.

The statistics and forecasts that are contained within the Global Gambling Report have become widely recognised within the industry, the financial community and the Media, as the industry standard for sizing both the online and offline gambling markets. Consequently GBGC is the most widely quoted source of industry data in share prospectuses and analysts' notes as well as on TV/Radio and in publications as diverse as the Financial Times, Forbes, Time Magazine, BBC Radio 4, BBC Breakfast, ITN news, the Economist and Fortune magazine.