Daily Archives: January 15, 2014

As Communities Consider Online Gambling, the FBI Warns of Money Laundering, Cheating & Fraud

Casino Watch Focus has reported on the various attempts at legalizing online gambling, both on a state by state level and at the federal level. As debates continue in these various arenas, the FBI wants to be sure the criminal implications are understood by those who consider either gambling online themselves or simply allow its existence in their communities.  An online source carried the PRNewsire release of a Joint Statement of Experts who outline the FBI’s statement:

Joint statement by: Michael K. Fagan, career federal prosecutor and post-911 anti-terrorism coordinator active in investigating and prosecuting illegal offshore online commercial gambling enterprises; Earl L. Grinols, distinguished professor of economics at Baylor University, former senior economist for the President’s Council of Economic Advisers; Jim Thackston, software engineer with a background in the aerospace, manufacturing and energy industries; John Kindt, Professor of Business and Legal Policy,University of Illinois, Senior Editor, U.S. International Gaming Report.

The FBI recently wrote Congress for the second time expressing the Agency’s concern that online gambling – including Internet poker – is vulnerable to money laundering and cheating and is a vehicle to bribe public officials and others. Online players can disguise both their location and identity and thereby fleece unsuspecting innocent participants. In its September, 2013 letter, the FBI stated “Transnational organized crime (TOC) groups might exploit legal online gambling to generate revenue, steal personally identifiable information (PII), and engage in public corruption.” The FBI’s correspondence confirms what we have known for several years that, despite the gambling industry’s claims to the contrary, there exists effective and non-detectable methods which can be used to anonymize a player’s identity and geo-location in order to corrupt a game and these threats will become more prevalent as more states race to embrace online gambling. As the FBI confirmed, “Individuals may use a wide variety of mechanisms to conceal their physical location, or give the appearance of operating in a different jurisdiction ” This statement is easily proven using scientifically verifiable and undetectable methods to demonstrate how a person located in Pakistan can play poker on a system located inside New Jersey. We know because we have done it. Despite what the poker websites and online gaming activists claim, this science is irrefutable and has been peer reviewed by top computer experts and law enforcement.

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