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Shockwaves have been sent through the online gaming industry after the unexpected approval of anti-gambling legislation late on Friday in the US.

The laws – the first in the States to deal specifically with internet gaming - ban banks and credit card companies from processing payments for bets placed over the web.

They were approved by Congress after being attached to an unrelated bill on security in US ports – a move which took many in the industry by surprise.

Debate over the issue had focused on a separate, stand-alone gambling bill which lawmakers have yet to approve.

Gaming firms – several of which rely on the US for the majority of their takings - held emergency meetings over the weekend to discuss the move's impact.

888 Holdings – which earned 52% of its revenues from the States in the first half of this year - said it expected the laws to become effective within the next fortnight, after they are signed by president George Bush.

Although saying the precise effect of the legislation was still unclear, it said it was suspending bets from customers in the US.

It added it would “review its fixed cost base in light of the suspension”, and that this could result in charges being taken in its annual results.

Sportingbet, which also relies heavily on US-based customers, said it would take advice in the next few days before “taking any specific actions as a result of the Act.

But the company, whose former chairman has now been freed after being arrested in the US earlier in the month, said it had scrapped a planned merger with rival World Gaming.

"Should Sportingbet's non-US international banking partners determine that the act applied to them, then Sportingbet would no longer be able to take deposits from US residents and this would have a material impact on the company's trading performance," it said in a statement.

At the time of writing, Sportingbet’s shares had fallen 62% on the news, while World Gaming’s were 73% down.

In a joint statement, the two companies said they had “discontinued any discussions” regarding the takeover.

Meanwhile, PartyGaming, which generates almost 80% of its revenues from the US, said the bill would cause its financial performance to fall "significantly short of consensus forecasts" for 2006 and 2007.

The firm, whose shares were 58% down, added: "If the President signs the act into law, the company will suspend all real money gaming business with US residents, and such suspension will continue indefinitely."

Aside from gaming companies, hundreds of thousands of consumers will no doubt be up in arms at the move.

The US-based Poker Players Alliance said: "This last-minute deal reeks of political gamesmanship. The American people should be outraged that Congress has hijacked a vital security bill with a poker prohibition that nearly three-fourths of the country opposes."

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Published 2 October, 2006 by Richard Maven

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Comments (2)

Jay Gohil

Jay Gohil, Senior Online Marketing Manager at borro.com

This ban is crazy. What about mobile betting? Is that under threat too?

about 10 years ago

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Robert Fathers, CEO at Singles Limited

Gambling Affiliates turn to Dating

Obviously Gambling has been a very lucrative business for online gambling and with recent bans throughout the online Gambling industry. Affiliates, who have been making their fortunes gambling, have been looking in other directions to find a source of business equally lucrative to substitute as an alternative.

Robert Fathers, the CEO of World Dating Partners, the largest social networking dating company worldwide says, “their has been an incredible upsurge with affiliates scrambling to own their own dating site with us, in order to equal the revenue that they used to earn in the gambling industry,” Further. “We have seen an incredible increase of over 100% in registrations with online gambling affiliates joining our system”. Word must be getting around.

The expertise that they bring to the online dating and adult dating industry is very welcome and compete in a way that is making many experienced dating affiliates look tame in comparison.

The dating industry has had its fair share of regulations imposed on the industry itself and sympathises with their predicament and we do all we can to help accommodate them into their new role in dating. In fact we are finding that on average ex-gambling affiliates are marking up over 50% more on average per month with their more diverse forms of marketing techniques and are finding extra benefits not seem before in their past with the benefits of recurring payments.

We hope to see further significant increases in new partners to www.world-dating-partners.com as word gets around and hope that we can give them the support in a new industry. World Dating Partners have Partner earning over $3 million a year in the past and are quite confident that our new friends will pop that figure as soon as they get into the swing of how the dating industry works.

about 10 years ago

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