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Australia's Robert Waterhouse is Back, with an Internet Gaming Venture

17 August 2001

MELBOURNE, Australia –- As reported by The Age: "Robert Waterhouse is modestly described as a `licensed bookmaker, horse breeder and form expert, and professional gambler' in the prospectus for his latest business venture.

"…At no point does the prospectus - which outlines backing WaterhouseBet, the family business, into listed investment company Southern Equities - mention Fine Cotton, a scandal that has kept Waterhouse away from racetracks the world over for the past 17 years.

"(In 1984, Waterhouse and his father, Bill, were found to have had prior knowledge of the Fine Cotton horse swap.)

"Nevertheless, Waterhouse is back following the lifting of restrictions, and investors are cordially invited to place bets on Southern Equities, which is hoping to raise $5.3million through an issue of 25million shares at 20cents each and 67million half-cent options.

"…The foundation of the new business will be WaterhouseBet as well as another company, International Data Processing Ltd. The two will form an Asian-focused Internet gaming business planned to be running by December.

"WaterhouseBet owns a Fijian-based betting-shop operation known as Grants Waterhouse Agencies that until 1998 was owned by a partnership of Bill and Jack Waterhouse and Francis Grant.

". . . The history of IDPL, which controls Internet betting and casino assets in Vanuatu, is just as interesting.

" 'During the period from April 2000 to mid-July 2000, the Internet casino recorded substantial betting turnover,' the prospectus explains.

" 'However, it subsequently became known that a high proportion of the deposits made to the casino were fraudulently based on stolen credit card numbers.'

"Needless to say, the casino suffered losses, which were funded by IDPL's major shareholder, My Casino. My Casino is selling IDPL - which closed the casino but still holds a gaming licence and computer equipment - to WaterhouseBet.

"Elsewhere, the prospectus lists a comprehensive array of investment risks. Apart from competing against Kerry Packer, who plans to establish a Pacific-based online casino, the best of these would have to be the `risk of civil rebellion, expropriation, nationalisation, renegotiation or nullification of existing contracts' that comes with locating your operations in Fiji and Vanuatu.

"…This time around, there are few bold claims. Indeed, there are no profit forecasts. Curiously, the chairman's letter mentions earnings targets of between $1.5 million and $7.5 million, while the prospectus says `the company has no history on which to base forecasts'."

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