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FRONT PAGE - EDITORIAL PAGE I recently received a press release (reproduced in full below) about a new organization that hopes to provide online gamblers with "high levels of assurance of fair, honest, and responsible gaming", which is certainly a noble goal and one that will be welcomed by all of us in the industry. To be sure, this is not the regulation by law that we'd like to see, but Internet gambling is still (as difficult as it may be to imagine) in its infancy, so any effort to make it more legitimate cannot be a bad thing. My choice of words, "more legitimate", makes me wonder if I've created a new oxymoron or am just using poor English. Either way, it's an interesting phrase. It seems to me that something is either legitimate or it isn't - just like being pregnant; you either are or you aren't. But "gray areas" that are neither black nor white abound in the online gambling business - as in many other businesses - so any effort to make things more clearly defined has got to be good. Let's face it, there are lots of good, honest Internet casinos out there and there are a lot of crooks in the business as well. Separating the two isn't easy and really should not be left up to people like us who rely on the casinos for our income, no matter how willing we are to forgo the $$$ we could be making by promoting less-than-honest operations. I guess it all boils down to how well we want to sleep at night versus how well we want to live during the day. Naturally, I can speak only for the GameMaster group of Websites and our opinion is that we're here for the long run, so promoting good, honest casinos is the only way for us to keep a credible reputation. We aren't perfect, but we want to be, at least in that regard. The new organization that's been created is called "eCOGRA". This is from their press release: The objective of eCOGRA (e-Commerce and Online Gaming Regulation and Assurance) is to be an independent entity that provides important player protections to consumers, including that operators are honest, games are fair, monetary deposits are safe and winning bets are paid in a timely manner. The software of the founding member companies of eCOGRA together account for more than 70% of casino type gaming on the Internet. eCOGRA is open for application for membership by online gaming software suppliers who share the vision toward fair and responsible online gaming. The eCOGRA Board will limit membership to those suppliers which are accepted by the Board as having and proving the highest level of integrity, are able to comply with the Statements of Generally Accepted Practices, and who are accepted by the Audit Panel. First of all, it's described as an "independent entity", but the two primary companies behind it are Microgaming Software Systems Ltd, the largest licensor of Internet casinos, and Virtual Holdings Ltd, owner and operator of Casino-on-Net, one of the largest internet casino companies. This was freely disclosed in the press release, by the way. But it begs the question: Is this just one more self-serving industry group that will present itself as the gambler's "friend", but in reality do nothing of the kind? In light of such other organizations as SafeBet and the Electronic Gaming Commission, both of which were established as straw-men organizations by software manufacturers and casino owners to give the impression of some sort of guarantee and/or assurance to unknowing players, it's a fair question. While I personally have no concerns about the fairness and honesty of Microgaming and Casino-on-Net, one must still cast a skeptical eye at their new venture. That said, the people they've hired as the board of directors for the organization, save one, have impressive credentials: The initial six directors are the Chief Executive, Andrew Beveridge; three independent directors -- Paul Hainsworth, former Director of Risk Management at PriceWaterhouseCoopers for Europe, Africa and Middle East; Bill Galston OBE, former Chief Inspector of the Gaming Board for Great Britain; and Frank Catania, a former Assistant Attorney General in the State of New Jersey and Director of the New Jersey Division of Gaming Enforcement -- together with a representative from each of the founding members, Microgaming and Virtual Holdings. The one person I have no knowledge of is in what is probably the most important job, that of Chief Executive. I have never heard of Andrew Beveridge, either in the context of land-based or Internet-based casino gaming and there was no information on Mr. Beveridge's qualifications included in the press release. However, according to the press release, the three independent directors will: "always have voting control over board decisions, to guarantee eCOGRA's autonomy from software providers and operators." That sounds good, but if these independent directors are being paid by Microgaming and Casino-on-Net, how independent are they, really? Hopefully they feel as we do, that they're in this for the long term and honesty is truly the best policy. An argument for which I have no counter-argument is that this organization is being paid for by others and not the players, so how can it hurt? One of the great things about the Internet is this: Should eCOGRA just be an attempt to build the business of its members by making guarantees and promises that it can't (or won't) keep, it will not take long for us all to discover the truth. On the other hand, maybe this is the beginning of a new, enlightened era of Internet gaming that will be good deal all around. What a nice thought! - The GameMaster Here is the full text of the eCOGRA press release: New Independent Organisation Established To Assure Fair Gaming Practices; Backed By Leading Software Developers LONDON - April 14, 2003 - A new independent organisation, eCOGRA, that will provide online players with high levels of assurance of fair, honest, and responsible gaming was announced today with backing from Microgaming Software Systems Ltd, the largest licensor of Internet casinos, and Virtual Holdings Ltd, owner and operator of Casino-on-Net, one of the largest internet casino companies. eCOGRA, which stands for e-Commerce and Online Gaming Regulation and Assurance, is a non-profit organisation based in the United Kingdom. eCOGRA has commenced with six directors, including three independent directors who will always have voting control over board decisions, to guarantee eCOGRA's autonomy from software providers and operators. Andrew Beveridge, chief executive of eCOGRA, said, "The organisation will provide online gaming software suppliers and their customers with the guidance and tools necessary to adhere to a higher level of integrity and responsibility." He added, "eCOGRA is a long overdue initiative in an industry that has been trying to build credibility with consumers and regulators. Our mission is to prove that responsible companies are involved in online gaming and to make them readily recognisable to consumers and government officials." The initial six directors are the Chief Executive, Andrew Beveridge; three independent directors -- Paul Hainsworth, former Director of Risk Management at PriceWaterhouseCoopers for Europe, Africa and Middle East; Bill Galston OBE, former Chief Inspector of the Gaming Board for Great Britain; and Frank Catania, a former Assistant Attorney General in the State of New Jersey and Director of the New Jersey Division of Gaming Enforcement -- together with a representative from each of the founding members, Microgaming and Virtual Holdings. "The eCOGRA Seal will become the benchmark gold standard," Beveridge said, "an instant symbol to the players that they can trust the site to offer fair games and honest, timely payment transactions." Gaming sites that apply for the seal must use software supplied by a member of eCOGRA and must comply with the eCOGRA Statements of Generally Accepted Practices, as documented by a review of the site's procedures by eCOGRA's Audit Panel. The sites will also be checked for player protection policies, technical capabilities and anti-money laundering measures. PriceWaterhouseCoopers is a member of the Audit Panel, and other respected accounting firms are expected to be added as members in the near future. It is the intention that the eCOGRA Statements of Generally Accepted Practices will ultimately form the minimum requirements for regulated online gaming. Internet gambling is big business: Christiansen Capital Advisors estimates that the industry's worldwide gambling revenue totaled US$4.1 billion in 2002. But this was spread among an estimated 1,800 web sites. "These sites run the gamut from highly regulated to completely unregulated," Beveridge said. "With eCOGRA, the software providers are getting involved in the interest of the gambling public. We will certify operators that players can trust." "As the online gaming industry matures, there is a need for responsible software suppliers to take the next step toward increased credibility," Beveridge said. "eCOGRA is this step. Consumers will now have a choice. They can play at casino web sites knowing that their deposits are secure and the casino games are fair. This self-imposed regulation overcomes the difficulties of existing attempts to regulate, which are all based on terrestrial gaming models and do not provide the fundamental advantage of Total Gaming Transaction Review on a continuous basis." Initially, eCOGRA will focus on online casino gaming. It will evolve to include other forms of online gaming, such as sports books, poker and bingo. About eCOGRA The objective of eCOGRA (e-Commerce and Online Gaming Regulation and Assurance) is to be an independent entity that provides important player protections to consumers, including that operators are honest, games are fair, monetary deposits are safe and winning bets are paid in a timely manner. The software of the founding member companies of eCOGRA together account for more than 70% of casino type gaming on the Internet. eCOGRA is open for application for membership by online gaming software suppliers who share the vision toward fair and responsible online gaming. The eCOGRA Board will limit membership to those suppliers which are accepted by the Board as having and proving the highest level of integrity, are able to comply with the Statements of Generally Accepted Practices, and who are accepted by the Audit Panel.
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