Investment banks included in gambling investigations

The subpoenas were issued to firms that had underwritten the initial public offerings of some of the most popular online gambling sites that operate abroad. The banks involved in the inquiry include HSBC, Credit Suisse, Deutsche Bank and Dresdner Kleinwort. The New York Times reports that while online gaming sites like PartyGaming and 888 Holdings operate from Gibraltar and their initial public offerings were held on the London Stock Exchange, companies that do business with them and have large bases in the US have come under scrutiny by regulators in Washington. The prosecutors may be emboldened by a law signed by President Bush last October that explicitly defined the illegality of running an Internet casino. Even before that law, the Unlawful Internet Gambling Enforcement Act, was adopted, the government said that Internet gambling was illegal under a 1961 provision. Full report in The New York Times

Senior bankers and leading politicians have attacked the demands from the DoJ for British bankers to hand over details of their dealings with online gambling companies outlawed in the US. After calls on the British Government to spell out the limits of the US authorities’ reach, the Treasury said it was monitoring the situation. ‘There is growing suspicion that the US Department of Justice is using its muscle in a highly unpleasant manner, and is targeting financial institutions beyond their own shores in a way that cannot be justified,’ said Alan Duncan, Shadow Trade and Industry Secretary. The Times reports that Vince Cable, the Liberal Democrat Treasury spokesperson and a former chief economist for Shell, said the move appears to be \'another case of extra-territorial and retrospective action from the US authorities that goes against two basic principles of justice.\' Full Times Online report

Staying with online gambling issues: Casino Enterprises, the company that runs Piggs Peak online casino, among other gambling sites, has appealed against a ruling by Pretoria High Court judge Willie Hartzenberg. Hartzenberg gave Casino Enterprises until 15 December to redraft an application for a court order that could declare its Internet gambling operations in SA legal. In his 27 November judgment, Hartzenberg said that, in his view, Casino Enterprises did not disclose a reason for approaching him for the order. \'We have put in papers to appeal,\' says the company\'s operations director Lew Saul Koor. Despite Hartzenberg effectively having set the case aside, the parties involved have drawn diametrically opposite conclusions from the case. ITWeb reports that the National and Gauteng Gambling Boards view Hartzenberg\'s judgment as a victory and have threatened to prosecute online casinos, gamblers and advertisers alike, while Casino Enterprises believes its activities remain perfectly legal. Full ITWeb report