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888 and Bwin shares skyrocket as US wagering competitors closed

18 April 2011

Shares in London-listed online betting companies rose after some huge poker websites in the US were shut for supposed unlawful activity.

At the close of trading, Bwin were up 30% and 888 up 15% as investors speculated that the US closures would improve their operations.
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On Friday, 11 individuals linked to 3 significant poker sites were charged with offences, consisting of fraud.
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The US probe includes 3 websites: Full Tilt, PokerStars, and Absolute Poker.

Federal US authorities accused the three online poker websites of controling banks to process billion of dollars in unlawful income.

According to Execution Noble analyst Geetanjali Sharma: "The closure of the primary competitors' operations and the US legal proceedings initiated against them should benefit European noted operators."
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Playtech, another gaming website, likewise saw its shares jump 11%.

'Criminal fraud plan'

Prosecutors in New York City City on Friday said they had provided limiting orders against more than 75 checking account in 14 nations used by the poker business.

US Attorney Preet Bharara said the sites "cooked up a fancy criminal fraud plan, at the same time fooling some US banks and efficiently paying off others to assure the continued flow of billions in illegal gaming earnings".

The indictment said the three gambling sites did not abide by the US Unlawful Internet Gambling Enforcement Act, developed in October 2006.

The law makes it unlawful for betting businesses to accept most forms of payment from individuals associated with illegal web gambling.

The indictment looked for $3bn (₤ 1.8 bn) in cash laundering penalties and forfeiture from the sites.

The authorities said Absolute Poker had actually stated shortly after the law was enacted that the US Congress had no control over the business's payment transactions.
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PokerStars posted a statement to its gamers on Saturday, saying it had to cash play for customers based in the US.
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"Please be ensured player balances are safe. There is no cause for issue," the business stated.
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"For all consumers outside the US, it is service as usual."

A message published on the PokerStars.com site by the FBI stated the firm had taken the domain in connection with the investigation.

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