Gaming News

Lasseters Corporation Ltd. stops accepting US-based players

Australian online casino operator, Lasseters Corporation Limited, today announced it has ceased to offer services to the United States of America following the introduction of new legislation in the US.

The Unlawful Internet Gambling Enforcement Act which was signed by the United States President last Friday evening makes it illegal for Lasseters to accept online bets from US-based players, immediately eliminating around half of the world's estimated US $10 billion online gaming industry.

Lasseters Managing Director, Peter Bridge, said the move had come as a shock to the global online gaming industry after the legislation was introduced by stealth in the US Congress, attached to the back of an unrelated security Bill. This follows the failure of two internet gaming prohibition Bills introduced into the US Congress earlier this year.

"We have received legal advice from the United States and unfortunately see no alternative but to cease operating in the US market," Mr Bridge said.

"The US has always been a major market for Lasseters as we had first mover advantage when we entered eight years ago as a fully regulated operator. It accounts for approximately 70% of our annual revenue".

"Lasseters has always upheld the highest standards of regulation and will not be involved if there is a risk of illegal activities."

The Company indicated that its profitability for the 2007 financial year is likely to be materially adversely affected by the decline in revenue, costs associated with initiatives to improve competitiveness and diversify its services, and subsequent write-downs. Mr Bridge said the Company is reviewing its existing operation from its non-US based markets and to expedite its plan on non-US market product diversification.

Further information would be provided to all shareholders at the Company's Annual General Meeting on 9th November 2006.

"We believe Lasseters has sufficient cash reserves to cover the immediate challenges associated with this issue," Mr Bridge said.

"While the short to medium term impact is significant, the Board continues to seek out new markets to mitigate the effect. Mr Bridge said that blocking US-based players would not disrupt the ability of other registered players to participate in Lasseters games.

"We are able to block all US-based players registered on our sites using already established player identification protocols," he said.

"All US player accounts will now be paid out and their accounts closed, as a consequence of the new legislation."

Mr Bridge confirmed Lasseters will continue to compete in the remaining global online gaming market but will need to significantly change its operations to remain competitive.

Even without the US market, the international online gaming market is valued at between US $3 billion and US $6 billion per year.

"Essentially we need to continue strengthening the attractiveness of our existing online casinos, particularly in non-English speaking markets, while also progressing with plans to diversify into new online services," he said.

Lasseters launched a site tailored for European markets almost two years ago and is currently upgrading the operating platform used by its online casinos to facilitate multicurrency and multi-lingual functionality.

Mr Bridge said that its plan to launch an online sports betting operation, Lasseters Sportsbook, has become an important part of the business strategy.

"We have always intended to diversify our services and the sports book is the first logical step," he said.

"One of the big benefits of this is that it will enable us to offer services in the Australian market for the first time."

Mr Bridge said Lasseters has already started consolidating its business operations to ensure the company is competitive within a significantly reduced market.

"It is the Company's regret that the forced closure of the US market has led to imposed redundancies across the organisation," he said.

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