Statement on Internet Gaming

• Author: Bruce Zagaris
• Pages: 59-62

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Statement on Internet Gaming

7

Statement on Internet Gaming1

Bruce Zagaris

IN REVIEWING THE POLICY ASPECTS of Internet Gaming, consideration

should be made as to whether there exists enough regulatory and policy

mechanisms to meet potential problems with Internet Gaming.

Internet Gaming encompasses the traditional problems of casinos and

traditional gaming, such as playing by minors, fair advertising, consumer

protection, assurance of fair methods of Internet Gaming, controlling addictive

persons, and so forth.

In addition to the traditional problems of gaming, there are other

limitations which make Internet Gaming difficult to control. Among the

concerns with respect to Internet Gaming are: funds used in Internet Gaming

do not clear through a third party, thereby raising issues of whether the systems

and service providers keep sufficient records for tax, law enforcement, and

fulfillment of other policy goals; the persons and places responsible for record

keeping: compliance with Know Your Customer requirements; whether service

providers or other persons are responsible to make suspicious activities reports;

and whether proper mechanisms are in place for oversight authority.

The nature of Internet Gaming, namely, its anonymity, rapidity, and volume

of transactions make detecting, monitoring, and deterring illicit transactions

especially difficult.

One example of criminal activity that has impacted US consumers is the

operation of the European Union Bank in Antigua, in which Russian nationals

with criminal records engaged in both Internet Banking and Internet Gaming.

The gaming operation used the Internet bank to make transactions relating to

the gaming operation. It resulted in US$8 to 10 million in losses. When evidence

of problems in the operation of the bank surfaced, the bank closed and its

Russian owners disappeared.