In a case that has been years in the making, it was announced this morning that Party Gaming PLC, the company that has been at the forefront of providing poker and casino services to Internet players, has entered into a non-prosecution agreement with the U.S. Attorney’s Office (USAO) for the Southern District of New York.
The agreement comes after months of discussions between the two parties about Party Gaming’s operations in the United States prior to the enactment of the 2006 Unlawful Internet Gambling Enforcement Act (UIGEA). As part of the agreement, Party Gaming has accepted from the USAO an irrefutable “Statement of Facts” regarding its business activities prior to when the UIGEA was entered into law. Party Gaming, per the settlement, has agreed to pay $105 million over a three and a half year period that ends on September 30th, 2012. These payments will be due semi-annually and will come from the company’s existing financial resources.
As a part of the non-prosecution agreement, Party Gaming has admitted to offering online poker and casino games for real money to players in the United States from 1997 until October 13th, 2006, which was the day that the UIGEA was signed into law. The company also is conceding that transactions from customers in the U.S. intended for Party Gaming were processed by third parties and other gaming and payment-related companies, which is contrary to current U. S. laws.
According to the website Gaming Intelligence Group, this marks a new dawn for Party Gaming in the eyes of its CEO, Jim Ryan. Ryan states, “The resolution of our position with the U. S. authorities marks an important day for Party Gaming. It has been a long and complex process, but we have reached an amicable solution with the USAO that makes commercial sense for our business and is in the best interests of shareholders. We are now well-placed to seize organic as well as strategic opportunities that previously were beyond our reach.” The shareholders of Party Gaming stock on the London Stock Exchange appear to approve of the agreement, as its stock price as of press time has climbed 33 pence, or slightly over 13%, to 252 pence. The company is traded under the symbol “PRTY” in London.
This marks the close of Party Gaming’s disputes with the U. S. Government regarding its operations in the United States. Back in mid-December, Party Gaming co-founder Anurag Dikshit admitted to violating the Wire Act of 1961 in the Southern District Court of New York. The judge in that case, Jed Rakoff, did not immediately sentence Dikshit to jail time, which could have put the founder of PartyGaming away for up to two years. Instead, Rakoff scheduled sentencing for December 16th, 2010 with the posting of a $50 million bond. Dikshit has continued to cooperate in any online gaming investigations by the U.S. Government. It was also agreed that Dikshit would pay off a $300 fine million in three installments within months of the plea deal.
