Nambling Notes - June 1, 2006

1 June 2006

NCLGS I-gaming Hearing -- The National Council of Legislators from Gaming States (NCLGS)--the only organization of U.S. state lawmakers that meets on a regular basis to discuss gaming issues and a proactive educator of legislators on gaming issues--will hold its summer meeting in Boston June 2-4. The agenda includes a two-hour hearing on Internet gaming, to be held Friday. Jonathan Slade, NCLGS's Washington council will provide an overview of federal legislation and activity. Judy Patterson, senior vice president and executive director of the American Gaming Association, and Mark Hichar, a partner with Edwards Angell Palmer & Dodge, will provide a legal/industry perspective of the issue. Providing oral testimony on behalf of proponents of Internet gaming are Sue Schneider, CEO of River City Group and former chair of the Interactive Gaming Council, Walter Szrek, senior technical consultant of Szrek2Solutions LLC, William White, CEO of Global Cyber LLC, and Lonnie Powell and Scott Solomon of Youbet.com. Carey M. Theil, a director of the National Coalition Against Gambling Expansion, will provide testimony as an opponent of Internet gaming.

Hack Vulnerability -- An article in today's Guardian describes an incident whereby hackers stole the login and password information of online poker players and used them to sign in to various online gambling sites. The paper reports that in December 2005, a gambling information site called Checkraised.com began distributing an application that enabled users to measure the rake percentage taken by Internet poker rooms. Security companies started investigating the application after some users experienced problems, and it was discovered that the application was equipped with key-logging software that it dumped on users' computers. The software would record the users' keystrokes and then send the information to its author, who would use it to learn the username and password of individuals running the software. The author would apparently then sign in under the hacked accounts and lose funds to his own account. The Guardian said it does not know how many people had account information stolen in this way or how much was stolen. A notice on Checkraised.com says that the site operators commissioned an outside programmer to write the rake calculator application. Checkraised says it scanned the application for viruses, but it was apparently also equipped with a sophisticated "rootkit" that made it undetectable to most anti-virus software. David Sancho, a senior antivirus engineer at Trend Micro, told the Guardian, "It's a really worrying development, but although it's the first, it's not that surprising. It's almost certainly the start of a new trend because criminals will always go where the money is, and there's a lot of money in gambling. It's just so easy to steal money by losing it to yourself. Plus the criminals have the protection of knowing the victim has nobody to complain to. How's a site to know whether or not a person is a bad loser or really has been the victim of fraud?"

Tequila Poker -- Interactive gaming software provider Playtech has announced the launch of its new online casino game, "Tequila Poker." The game premiered in the land-based Hard Rock Casino in Las Vegas last year, and its creators have since licensed it exclusively to Playtech for play via interactive channels. The game begins with an ante followed by the dealing of four cards to the player. After viewing the initial four cards, the player can choose to fold or pay another ante to play a game by high/low rules or a game by poker rules. Two more cards are dealt if the player chooses to continue. To win by high/low rules the combined value of the five highest cards must be greater than 46, and to win by poker rules the best five-card hand must be better than a pair of aces. Winning payouts are equal to the ante amount.

Boss Poker Additions -- Interactive gaming software provider Boss Media has concluded agreements with Cyprus-based gaming operators, Bashedeger and The BetArena, both of which will go live with Boss Media's poker solution in August and aggregate players into the Boss Poker network. Boss says that in addition to the two Cyprus-based clients, eight other operators have joined the Boss Poker network: Hellenic Poker, Magic Number, Fun Time Bingo, EuroTelegroup, Maharaja Club, Mr. Poker, Fortuno, and BetClick. All eight operators are slated to launch poker sites in the third quarter of 2006.

Czech Stats -- Pozitron Information Services reports that citizens of the Czech Republic in 2005 spent a record sum of over CZK 90 billion (US$4.9 billion) on fruit machines, rate bets and lotteries. The figure is CZK 6.1 billion ($277 million) greater than that of 2004. The average amount bet for each citizen comes close to CEK 9,000 ($408). The volume of paid winnings was also a record in 2005, reaching CZK 69 billion ($3.1 billion).