The boom in online gambling -- along with concerns about sending money to Internet casinos that operate out of loosely regulated locales like Aruba, Costa Rica and Belize . has spawned a cottage industry: Web sites that purport to tell gamblers which operations they can trust, and which have reputations for cheating players.
These self-styled watchdogs publish reviews of online sportsbooks and poker sites, and maintain lists of recommended casinos. But gamblers may not realize that several of the watchdog sites have conflicts of interest. Many take advertisements from gambling operations, and some are paid commissions for driving traffic to casinos. One site, MajorWager.com, owns one of the sportsbooks it recommends.
The upshot: gambling operators sometimes get sparkling grades on watchdog sites where they have advertising or business relationships, while receiving poor marks where they don`t.
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Which type of Web site is most in need of greater government oversight? Participate in the Question of the Day.Some ratings sites have said "if you don`t pay me money, I will write bad things about you," said Alistair Assheton, chief executive of Leisure & Gaming PLC, which is publicly traded in London and operates gambling sites such as VIPsports.com and VIPpoker.com. "It`s very flattering to be very high on these lists, but it is not very flattering to pay $10,000 to be on the list." He said his company has been approached by sites that offered positive ratings in exchange for payment. He declined to name them.
Revenue from Internet gambling will total $12 billion world-wide this year, according to research firm Christiansen Capital Advisors LLC. About half will come from Americans, Christiansen said, even though the U.S. government says three federal antigambling laws make online gambling illegal and several states have explicitly banned the practice.
Sites like MajorWager.com, SportsbookReview.com and OSGA.com -- the "Offshore Gaming Association" . have capitalized on consumers` concerns about betting on the Web by offering their own guidance on where bettors can safely gamble. The sites rate casinos using a combination of their own analysis and reports from users on factors like how quickly a company pays out winnings. Some of the reviewers say they visit the offices of the casinos in person.
But many of the review sites have close ties to the casinos. Consider MajorWager.com, a site founded in 2000 by Russ Hawkins, a 39-year-old who used to make his living as a gambler. Mr. Hawkins, who works out of his lakeside home in Southampton, Ontario, also owns MajorBetting.com, a small Internet sportsbook based in Costa Rica. MajorBetting.com is on MajorWager.com`s list of recommended sportsbooks.
MajorWager.com doesn`t disclose on its recommendation page that it owns the sportsbook, though users who click through to a review of MajorBetting.com are told about the relationship.
MajorWager.com discloses that all of its recommended sportsbooks are also advertisers.
Mr. Hawkins said he pays Royal Sports Group, a gambling company in Costa Rica, to manage MajorBetting.com. Royal Sports is also on MajorWager.com`s list of recommended sportsbooks, and advertises on the MajorWager.com site.
Mr. Hawkins said MajorWager.com`s business relationships do not influence its ratings of gambling sites "in any way, shape or form." There are "conflicts of interest everywhere" among the watchdog sites, he said. "We try to show it. We don`t hide it." He said advertisers pay MajorWager.com a flat fee of $3,000 a month.
Royal Sports Group has a mixed reputation among ratings sites.
At SportsbookReview.com, Royal Sports gets a rating of "D-." Sites in that class have "poor customer service," with "some risk to players` funds," SportsbookReview.com says. When "players stop reporting that Royal will not pay them, we will gladly review their current rating," Shannon Donlea, financial controller at SBR Marketing Ltd., SportsbookReview.com`s parent, said in an email message.
TheOffshoreWire.com, another review site, also has reported that Royal Sports is slow to pay winning gamblers. It rates the site a five out of 10, and includes it on a list of "high-risk sportsbooks."
Royal Sports does not advertise on either site.
But at OSGA, Royal Sports is endorsed both as a sportsbook and as a poker site. The review says, "Royal has been through the ringer the last two years but, as a very established company would, has come out smelling like a rose." Royal Sports advertises on OSGA.com.
Kevin King, general manager of Royal Sports, said the company has had occasional problems with payment processors that have delayed payments to players, but he said SportsbookReview.com and TheOffshoreWire.com have exaggerated the issue. He said Royal Sports used to pay commissions to SportsbookReview.com for linking customers to its site, and said the review site maintained a positive rating on Royal Sports during that time.
Meanwhile, the owner of TheOffshoreWire.com, Roberto Castiglioni, is a former executive at Royal Sports.
Mr. Donlea, of SportsbookReview.com, and Mr. Castiglioni both said their negative reviews of Royal Sports were based on complaints from gamblers, and not their own dealings with the casino.
Ratings of other online gambling sites also vary widely. BetonSports.com, whose parent, BetonSports Plc, is publicly traded in London, is not rated at MajorWager.com. It is endorsed at OSGA.com, where it is an advertiser. Meanwhile, it gets a "D+" at SportsbookReview.com, where it has no business relationship.
Objectivity of Reviews
SportsbookReview.com rates hundreds of Internet sportsbooks, and criticizes sites that have a reputation of not paying winning bettors promptly. The site says on its main page that it has "no sportsbook ads." But it features prominent links to two other sites it owns: a discussion forum for bettors, where there are ads for sportsbooks; and another site where SportsbookReview.com earns commissions for directing bettors to sportsbooks.
SportsbookReview.com`s Mr. Donlea said these relationships don`t influence the company`s reviews. He said the company takes "player complaints seriously and [has] a no-nonsense approach to rating sportsbooks." The company has offices in Costa Rica, the Caribbean island of Curacao and near San Antonio, Texas, he said.
Other owners of ratings sites also defended their acceptance of advertising. "I wouldn`t take money from an advertiser I wouldn`t put my money at," said Jim Quinn, president of OSGA.com, which is based in Bala Cynwyd, Pa. The site recommends 40 sportsbooks, most of which pay to advertise on the site. "We actually visit these places," he said, adding that he has met in person with executives at more than 100 sportsbooks located in the Caribbean and elsewhere.
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