Enforcers May Impose A Heavy Price For Legality

ThisIsMoney.co.uk, the British financial news site reports that unidentified sources are speculating that the US Department of Justice could try to recoup all profits made by online gambling groups 888.com and PartyGaming.com in the United States following the passage of the Unlawful Internet Gambling Enforcement Act and prior to their exit. The site estimates that this could amount to nearly $900 million in the case of PartyGaming and $120 million for 888.

Such a disgorgement would severely hamper the companies’ financial viability, but it is by no means certain that they would be prepared to pay such a high price, says the journal, revealing that sources close to both companies said neither would be prepared to sign a blank check which could effectively put them out of business overnight. It was reported earlier this year that the two companies were in discussions with Department of Justice officials.

One alternative may be a shared disgorgement by both the companies and the principal founders and owners, to whom large dividends constituting the bulk of the profits have apparently been paid. 

PartyGaming has allegedly paid 90 percent of its US profits in dividends and 70 percent, it is claimed, went to the founding shareholders, who still own large stakes in the business.

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