PBL eyes Vanuatu for Net casino

The Internet gaming division of the Packer family’s Publishing & Broadcasting empire is preparing to pack its bags for Vanuatu to escape the Australian Government’s ban on online gambling fulfil PBL’s ambition to broaden its earnings base.

The Packers’ corporate love affair with gambling, which began with Crown casino in the early 1990s is likely to extend to setting up a casino off the coast of Taiwan, now seems destined to embrace cyberspace through an online casino run out of the South Pacific isl State.

“The Internet gaming team has been looking at locations in Vanuatu for some time as we’ve watched the Australian Federal legislation on Internet gaming,” a senior PBL executive confirmed.

“There has been no final decision, but that is certainly the most likely destination.”

A ban on local companies offering online gaming to Australians seems inevitable, after a Senate committee report to Parliament recommended adopting the ban proposed by the Government’s Interactive Gambling Bill.

Although it already owns a Tasmanian online gaming licence – which would still allow it to offer online gambling to overseas customers under the Government’s proposed rules – Australia’s uncertain regulatory environment has prompted PBL to investigate each of the world’s 54 online gambling jurisdictions.

The Federal Government has been widely criticised for the bill, which prohibits local operators running gaming Web sites targeting Australians, but which cannot stop Australians from gambling at online casinos based overseas.

The bill will need the support of at least three Democrats to pass the Senate. In a split in the party’s ranks, two senators – John Woodley Lyn Allison – indicated in the report they would vote against the Democrats’ leader, Senator Natasha Stott Despoja, support the Government’s ban.

The fate of the Government’s proposed ban rests with those Democrats yet to indicate which way they will vote, including senators Andrew Murray, Aden Ridgeway the party’s former leader, Meg Lees.

Last week Senator Woodley was reported in The Age as saying at least one other Democrat had decided to join him Senator Allison in supporting the ban.

In their minority report on the bill, the pair said they believed that although Australians under the proposed law would be able to gain access to offshore Internet gambling sites, they would be less inclined to do so knowing there were likely to be fewer consumer safeguards in place.

Last night a spokeswoman for Senator Lees said she had not yet made up her mind.

“She [is] still canvassing all the different positions basically,” the spokeswoman said.

A spokeswoman for Senator Ridgeway said the deputy leader of the Democrats “feels it is something the party room still needs to discuss”.

Kerzners US casino dealings

CAPE TOWN Allegations have been made that Sun International Hotels subsidiary Trading Cove, headed by Sol Kerzner, earned $430m more than it was entitled to by withdrawing from a deal with a Native American tribe.

No disclosure of the deal was made to the authorities when Trading Cove a joint venture between Sun International Hotels US entrepreneur Len Wolman sought approval for the development of the Mohegan Sun casino in Connecticut, in the US.

The Boston Globe has claimed that Trading Cove made $430m more than a limit established by the US congress a total gain of more than $800m from the project. The $430m was paid by the Mohegan tribe to buy back the exclusive rights to develop a hotel which it granted Trading Cove. Kerzner declined to comment to the Boston Globe about the profit made, but Wolman said the $800m was fair compensation.

The newspaper alleged last week that two former tribal chairmen were paid salaries by Trading Cove when they agreed to the controversial hotel deal, which is now under scrutiny because it appeared to skirt the restrictions on outside operators laid down in the 1988 Indian Gaming Regulatory Act.

Trading Cove the tribe have been criticised for failing to disclose the full extent of their financial relationship to regulators. Concern has also been expressed over a 1994 contract that gave Trading Cove exclusive rights to develop manage a hotel on the casino grounds for 14 years double the time outsiders can legally remain as Native American casino managers.

Trading Cove got the right to manage the casino , in addition, the exclusive right to develop any hotels on the site. Before receiving regulatory approval, Trading Cove withdrew the hotel plans.

The gaming commission chairman approved the casino deal without knowing of the hotel agreement, even though two associate commissioners had filed vehement dissents, saying even the casino deal alone was too generous to Trading Cove. Trading Cove retained the hotel rights for a later date, but refused to build a hotel would not cede its hotel rights to the tribe without a lucrative buyout.

In 1998 the two sides reached a deal whereby the Mohegans would buy back the hotel rights for $430m.

Cove gave about $9 million to the tribe in the years before the casino opened, all of which was later repaid from casino profits.

Isle of Man Issues

The Isle of Man issued its first three licenses for Internet casinos today. When the licensees’ sites open for business, they will herald the long-awaited arrival of major l-based casino brs in the balkanized online gaming industry.

MGM Mirage, Sun International Hotels Littlewoods Leisure got the licenses. The names of the eight other applicants were not released.

Littlewoods Leisure, based in Liverpool, Engl, already operates Internet sports betting sites. But this will be the first time that MGM Mirage Sun engage in online gambling, although Sun recently launched an online casino as a beta test.

MGM Mirage is Nevada’s largest employer one of the world’s biggest gaming companies. In addition to prominent Las Vegas hotel-casinos like Bellagio MGM Gr, it operates casinos in Detroit Mississippi as well as in Australia South Africa.

MGM Mirage has been, by far, the most eager of the major U.S. gaming companies to do business online. It is the first such firm known to apply for an online license, a move that carries the risk of antagonizing state regulators in the U.S., where the legality of online casino gambling – under federal law — is hotly debated among lawyers government officials.

Sun International Hotels, whose chief executive, Sol Kerzner, founded Sun International, the South African casino company, developed Mohegan Sun, a tribal casino in Connecticut. Its flagship is Atlantis, a resort on Paradise Isl in The Bahamas.

Tobin Prior, chief executive of SunOnline, said today that the receipt of the Isle of Man license “marks the beginning of a new era for the online gaming industry. It marks the entry of major l-based casino operators in a meaningful fashion an era when corporate credentials, br power, player trust protection will be elevated to new levels.”

Littlewoods Expects to be the First

Littlewoods is likely to be the first of the three licensees to begin operations. Colin McGill, managing director of Sportech plc, told a press conference today that Littlewoodscasino.com expects to launch at the end of October.

The site will use software provided by CryptoLogic, a Toronto company that’s a major developer of software for gaming e-commerce. McGill said Littlewoods is the United Kingdom’s oldest gaming business. It was founded in 1923 as an operator of football (soccer) pools.

In addition to the pools, Littlewoods runs charity lotteries a phone betting service. Its online sports betting sites, betdirect.net bet247.co.uk, have 40,000 registered customers between them, McGill said.

Sportech plc is the holding company for Littlewoods Leisure, which it acquired in a reverse takeover in September 2000. Sportech plc is listed on the London Stock Exchange.

Sun said its Atlantis online casino will begin operating in the fourth quarter. It did not announce the software provider, but its beta site, www.ambassadorcasino.com, uses software from Boss Media, a company in Vaxjo, Sweden, that provides gaming e-commerce software to numerous casino clients. The Ambassador casino is licensed in operates from Kahnawake, a tribal reserve near Montreal.