This week marked an important date for the world of online gambling and online payments. Yesterday we moved past the 270 day deadline created by the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). Tuesday was a 9 month deadline the US Treasury was given to issue regulations for the Unlawful Internet Gambling Enforcement Act (UIGEA). While the new regulations are not expected to be published today or even this week, we might just see them this summer. However, it could take much longer.

This week, is also the first time I’ve seen headlines like, Gambling Sites Named in Terrorist Money Laundering Allegations, which directly link terrorists with online gambling money.

Right after the 271st day….how is that for a coincidence? Headlines are just now appearing that link money laundering & terrorist funding with online poker,

“…alleged that one of the men, Tariq Al-Dour, laundered thousands of dollars through online gambling sites including AbsolutePoker, Betfair, BetonBet, Canbet, Eurobet, NoblePoker and ParadisePoker” *

I suppose my own catchy blog headline from February may have had some truth to it, Online Gambling & Terrorist Financing: America’s New “Poker Threat”. Too bad my attitude in the post was so slanted, I’ll be eating crow on that one, no doubt. Arg…..the power of digital media.

Also this week the US Secret Service busted a major ring of credit card crooks, making millions on stolen credit cards. (good job USSS) Although, I found it very unusual how many of those headlines included “e-gold”. While none of the indictments in this credit card case included ANY mention or information** regarding e-gold, the Secret Service did not miss the opportunity mention e-gold, in their press release.

This same press release spawned over two dozen other articles and blog posts about e-gold. It brought e-gold’s prosecution back into the headlines. That small press release mention created new headlines like this one, All that is e-gold does not glitter. Most of the other articles, such as this one, Feds Bust Credit Card Counterfeiting Ring, which were anchored by the information in that press release, rehash the current e-gold investigation with at least one or two paragraphs.

While its common place for politicians, spin doctors and ‘hachet job‘ novice video editors like myself, to use digital media in an basic attempt to influence the public, I believe it should be a rare occasion when government agencies (besides the CIA) use media in any attempt to influence a pending legal matter. Shouldn’t court cases, stay in court and stand or fall on the merits of the case? Well….that’s America for you….OJ walked, Paris went to jail. Digital media, is a powerful tool and we all use on some level to influence others.

**Resources for this post included a Washington post blog.

Update 7/12: Now this is a fair article, exact same event with more credible facts and information:

Secret Service Busts Four Fraudsters With Ties To T.J. Maxx Attack

“However, E-Gold chairman Douglas Jackson disputes these charges and asserts that his company first brought Blinky to the attention of law enforcement in March 2006. Jackson told InformationWeek that investigators working for E-Gold began monitoring Blinky pursuant to an undercover operation it was conducting with law-enforcement agents from the U.S., U.K., and Russia. “In May 2006, working with records supplied by an exchange service that had sold him some E-Gold, we were able to supply general location (Miami), three confirmed phone numbers he used, and the usual IP/timestamp combos that even in this day and age are often useful,” Jackson said.”

Update 7/13: Another good one showing yet another side to this story….

Who’s Fighting Identity Theft? You’d Be Surprised

“But Douglas says it was his company that first brought Blinky to the attention of law enforcement in March 2006. Jackson told InformationWeek that investigators working for E-Gold began monitoring Blinky pursuant to an undercover operation it was conducting with law-enforcement agents from the U.S., U.K., and Russia.

“In May 2006, working with records supplied by an exchange service that had sold [Blinky] some e-gold, we were able to supply general location (Miami), three confirmed phone numbers he used, and the usual IP/timestamp combos that even in this day and age are often useful,” Jackson said. “In September 2006 we were able to set up a quasi-ambush where the guy was sent a Fed Ex package such that we were able to supply law enforcement with a specific physical location (a garage in Miami) and a time to nab him.”

Jackson sent me a copy of an e-mail exchange he claims to have had with a Secret Service contact in January 2006. In an e-mail Jackson ostensibly sent to the agency, he requested the Secret Service use information gathered by E-Gold investigators to crack down on a card-counterfeiting ring. An enthusiastic-sounding response from the agency informed Jackson his Secret Service liaison had made contact with “our guys at HQ and they will be in contact with you or your staff concerning this matter.” Jackson told me that E-Gold was later “rebuffed” by the Secret Service and doesn’t know if they followed up on the information he says he sent them.”

It was announced yesterday that the EU just got in line behind Antigua and Barbuda in seeking compensation from the US due to the effects of the recent online gambling ban. These jurisdictions are now seeking some type of compensation due to the situations resulting from the US foreign online gambling sites ban that does not comply with global trade rules.

UK companies including Sportingbet PLC and Leisure & Gaming PLC were forced out of the profitable US market after President Bush signed into law the SAFE Port Act of 2006. That new legislation also included the Unlawful Internet Gambling Enforcement Act. It has effectively banned online gambling from the US by prohibiting the transfer of funds to any Internet gambling web site from any US financial institution. This move by the US is in violation of its treaty obligations by not granting full market access to online gambling companies based offshore.

Of course excluded from this ban were ‘fantasy’ sports, online lotteries and horse racing. Why…ummm…because? Well, I’m not real sure why but it really did happen, I can’t make this stuff up!

These new regulations, blocked access to the most lucrative US market estimated to be worth about $15 billion the previous year. Last year the WTO ruled that the new US law unfairly targeted offshore casinos. The WTO told the US it could keep the restrictions on sports betting if they also applied to US businesses.

It is really amazing to stand back and watch the worldwide effects caused by this bastard of a new law. “What happened to the global online payments business after the UIGEA” …somebody should write a book with that title.

Negotiators for the EU admit that the talks could take a long time…well that’s an understatement. Good luck!

In a move which has resulted in compliance with the Unlawful Internet Gambling Enforcement Act of 2006, e-gold has added a software option for all user accounts that will prevent gaming companies from receiving US account holder payments.

The addition seems to make e-gold digital currency safe for all account holders struggling with the interpretation of new US regulations.

e-gold Empowers Online Gambling Sites to Refuse Payments from US Persons

On October 12, 2006, the Safe Ports Act was signed into law in the United States. As a result of the Safe Ports Act and the Unlawful Internet Gambling Enforcement Act of 2006 contained in the Safe Ports Act, the facilitation of many forms of Internet gambling by persons located in the United States has become a proscribed activity. With the objective of preventing the use of e-gold by United States persons for unlawful online gambling, e-gold has deployed a feature whereby any e-gold account holder may configure their e-gold account(s) to block incoming e-gold Spends from accounts controlled by Users residing inside the United States or who are accessing the Internet from within the United States. Online gambling businesses using e-gold are now required to enable this new account attribute.