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Internet Gambling News Media Round-Up

May 14, 2010 (CAP News Wire) – In your weekly online gambling media round-up, big online business sites like Forbes, BusinessWeek and the Wall Street Journal are weighing in with their own Internet gambling stories.

A new story at Forbes takes the angle of a Canadian who was recently convicted of American-related online gambling charges and explores the entire North American online gambling industry from there. “The Department of Justice bags a Canadian payment processor in its fight against online poker. Are the big online firms next?” asks Nathan Vardi in the article.

“The U.S. Attorney in Manhattan struck a big blow on Tuesday by getting Douglas Rennick, 35, a Canadian payment processor, to show up in New York and plead guilty to violating the Wire Act by processing more than $350 million in the U.S. for Internet poker companies and other online gaming firms,” Vardi continues. Rennick is scheduled to be sentenced in September.

Vardi’s big question remains: Is Rennick’s plea deal a sign that more payment processors are next, or is it a sign that the government may actually go after the big online poker operators? “[T]he owners and operators of the biggest online poker firms are an open secret–and many of them can be found regularly playing poker in Las Vegas or promoting their companies at U.S. events shown on television,” Vardi states, noting that the industry “services 2.5 million Americans who play and bet $30 billion annually”.

This story was also covered by Bloomberg, another major business media news source. “When asked by U.S. District Judge Sidney Stein to describe his crime, Rennick said, ‘I had a business that transferred money from offshore gaming sites to American players within the Southern District of New York,’” the Bloomberg article states, giving an interestingly blunt depiction of the “crime” in question. And, like the Forbes story, this one also covers the recent legal history of the UIGEA prosecutions in detail.

In the Wall Street Journal, a larger-focus article addressing the trend for state governments to embrace legalized gambling efforts to generate much-needed revenue was published this week. “Hampered by withering funds for law enforcement, health care and other public services, a growing number of officials are condoning activities and businesses they’d be apt to restrict in better economic times,” the article states, making it clear that online gambling is among those “other” businesses.

“California legislators are debating whether to allow and tax Internet poker, even though such gambling is prohibited by federal law,” the article states. “It is generally easier to pass something like this in a recession,” the article quotes Lloyd Levine, a political consultant and ex-state politician working for the pro-poker effort. An accompaying article in the WSJ also provides a handy state-by-state rundown of other parts of the U.S. considering similar laws; check it out here.

Good or bad, this level of Internet coverage in the U.S. (and even global) online media was unheard of even a few short years ago. Also, it’s interesting to see the media’s take on the Internet gambling evolve from a primarily moral position to a primarily economic one.