INTERNET BETTING AND GAMBLING: CRISIS #23,765
Via Niall O’-Connor of Betting Market, The Register’-s Burke Hansen (a San Francisco attorney):
House of Cards. The American Department of Justice (DOJ) threw a spotlight on the murky underworld of internet gambling payment processing this afternoon with the indictment in Utah of seven individuals and four companies – including BetUs.com and serial violator BetonSports.com – involved with processing payments for online gambling transactions, according to the Associated Press. The indictment seeks to recover $150 million from the defendants under the Racketeering Influenced and Corrupt Organizations Act (RICO), in addition to hard assets such as real estate and property used in running the operations.
Ever since President Bush signed the Unlawful Internet Gambling and Enforcement Act (UIGEA) into law last October, internet gambling companies have been scrambling to process payments from frustrated American customers. […]
Although the UIGEA does not take effect until early July, major financial institutions pulled out of the American market almost immediately, forcing American gamblers and US–facing gambling suppliers to resort to increasingly roundabout methods of payment. […] Money laundering is just the disguising of the true nature of a financial transaction, and the convoluted payment systems allegedly developed by the defendants appear to qualify as that. […] Just how does the DOJ unravel these things? Although Tolman didn’t discuss that question, the DOJ most likely triangulates based on payment histories readily provided by American or foreign financial institutions. The DOJ could fairly quickly compare the payment history of a customer account formerly sending monthly payments directly to Bodog, for example, with more recent post-UIGEA history of the same account and guess with some accuracy where the gambling money now goes. […]