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Strategies & Market Trends : Sharck Soup -- Ignore unavailable to you. Want to Upgrade?

To: Schtoink! who wrote (36686)	10/19/2001 11:37:29 AM
From: Sharck	Respond to of 37746

RealMoney.com : Herb on TheStreet State Charges CryptoLogic Violated Gambling Laws By Herb Greenberg Senior Columnist 10/18/2001 01:01 PM EDT Forget whether Internet gaming company CryptoLogic (CRYP:Nasdaq - news - commentary - research - analysis) is violating gambling laws in Canada, as this column suggested recently. Related Stories Long Odds on Gaming Software Company CryptoLogic I'm-Still-Standing Stocks: Western Digital, Maxtor A more pressing issue may be whether it's violating gaming laws in the U.S. On Tuesday, the New Jersey attorney general filed a complaint in Superior Court against a number of Internet gaming and sports book companies, including CryptoLogic and its largest licensee -- InterCasino -- alleging violations of New Jersey's Antigambling Act, the criminal code of New Jersey and the Consumer Fraud Act. According to the complaint, a gaming enforcement investigator, posing as an online consumer, was able to gamble from an office in Trenton, using InterCasino's Web site. Specifically, the investigator was able to deposit funds into an account and place five wagers on one professional and four college football games. Such activities, according to the complaint, are illegal in New Jersey unless the gaming company receives an exemption from the state, which involves a public referendum and an act of the Legislature. In addition, according to the state's gaming laws, a gambler who loses money via an illegal gambling operation should be able to get back all of the lost money. As part of the suit, the state wants an accounting of all money won by New Jersey residents during the past year and the state wants the gaming companies to turn over any money won by the gaming companies during the past six months. The suit does not seek reimbursement from any individuals who played the games. And this note: If the state is successful with this suit, an attorney general's office spokeswoman says, the next step will be to go after credit card companies for facilitating illegal activity. CryptoLogic officials couldn't be reached for comment. Meanwhile, when we last left CryptoLogic, one question here was why Israel Ben-Ishai, the chief technology officer for three months, had suddenly quit. The company's line was that after a "probation period," it was determined that there wasn't a "strategic fit." My colleague Brian Harris caught up with Ben-Ishai Wednesday and asked why he left and whether it was really an issue of strategic fit. "The only comment I want to make there is that I did not have a probation period," Ben-Ishai said. "There was no probation period in my agreement with CryptoLogic." Ben-Ishai then explained he had a confidentiality agreement, and could say little more. "When I sign an agreement not to disclose confidential information, then I do not do that. If there was a legal investigation, I would tell the proper people what I need to tell them. I'm not saying there is something illegal to tell, but if there was, I would. That's about it. But, otherwise, there's no reason for me -- there is no -- it's not a question of being vindictive or anything like that. I don't believe in those things." Brian: "So, there was no probation period and your leaving was motivated by more than just that there wasn't a strategic fit?" Ben-Ishai: "We agreed that certain things did not fit. Strategic fit is a very, very broad term. You can include a lot of things underneath. That's fine. I have a lot of respect for [CEO] Jean Noelting. I think he's a good guy. That's it. I'll leave it at that." Brian: "I have to ask you this: Was your decision to leave based at all on a belief that things were not structured legally at CryptoLogic?" Ben-Ishai: "I have no comment."