888 hit as US cracks down

ONLINE casino gaming firm 888.com has denied a US crackdown on internet poker sites will harm it, following a turbulent week for the company which saw the departure of its chief executive, chairman and its merger talks with Ladbrokes end in tatters.

The firm said the suspension of its operations in the US since 2006 meant it was within the law, although the prospect of litigation remains and had earlier been linked to Ladbrokes’ decision to walk away from a deal.

The federal government launched a swooping crackdown on internet poker sites on Saturday, arresting the founders of three of the largest online poker firms doing business in the US.

The websites of PokerStars, Full Tilt Poker and Absolute Poker were seized and taken offline by the government.

The ongoing Department of Justice investigation into online gambling could also put 888 in the firing line.

The firm has not struck a deal with US authorities to give it immunity from retrospective legal action in relation to its activities in America prior to 2006.

However, 888 recently gained approval from Nevada state regulators for a marketing agreement with Las Vegas hotel Caesars, a move the firm said would bolster its push for licensed online gaming in the US.

Shares in the company plummeted after Ladbrokes announced it had walked away, whilst stock in the high street bookmaker shot upwards.

The development follows the shock departure of chief executive Gigi Levy last week, following a row with the firm’s Israeli owners.

888’s problems were further compounded when Brian Mattingley stepped aside as chairman of the audit committee whilst a new chief executive is sought. Richard Kilsbey remains chairman of the firm.

However, the firm produced strong financial results for its first quarter of this year, and said that even without Ladbrokes its business remained “well-positioned” for future growth.