secondlife casino owners: you could get charged for rackeetering

No, they aren't. Wake me up after they go after the gambling that occurs in far more popular games like World of Warcraft. Then I'd say signs are strong. Right now, signs are very very weak. To the best of my knowledge, the FBI has never shown any interest in investigating gambling with game curency, regardless of how easy it is to exchance for real world dollars or not (and most of them are).

I will admit right now I haven't waded through this entire thread, since it's late. However, I do want to point out that the Senate hasn't voted on the new bill yet, and this is fun and games by the Feds at this point, not a sweeping new law that is going to put everyone in jail.

Everyone should wait and see. Most think this is a move by the Feds because of pressure from congress, but doubt the bill will pass the senate (I've already said I think it will fail). I doubt they will be coming after those who run a casino in a virtual reality game/world before they go after the big online gambling sites, either way. In fact, I would guess they don't even know SL exists.

Ohhh...free room and board!

Well then, that give me a great idea for a RL casino. I'll run a casino just like a regular one. Only I'll only *sell* the chips, not buy them back. But inside the casino, I'll allow independent brokers (who bear no relationship to me other than I'm allowing them to use my facilities and run their own gambling machines too) to buy and trade the chips for RL cash. I'll also allow stores and such in my casino that sell goods and services for chips.

I'll locate my casino in a state where casinos aren't allowed and when the cops kick down my door, I'll simply explain to them that the chips don't have any RL value and that all the people playing the slots, tables, etc. are just doing it for the enjoyment, not money.

They'll surely buy that, right?

-Pall

We play in a virtual world and as far as i know there arent any virtual jails here. Where are they going to keep us all? Gambling isnt per say illegal in many places in the us and abroad. In the us as long as you are paying your taxes ongambling whether illegal or legal, the govt isnt gonna care to much. Lets face facts, Al Capone allegedly killed how many people, extorted how much money from people not to mention the other crimes he was involved in...Guess what...he went to jail for TAX EVASION. Now just maybe if some american is making 100kUS a year from his sl casino and isnt paying his taxes, heck yeah, that guy is a target...but people like me who own tiny casinos and give away far more then they make, after advertising, giving out free money from freeplays, possibly dance pads not to mention free money balls dont have a thing to worry about. If i do, then just maybe i can write off my losses on my taxes next year...It is ludacris to think that anyone on sl is ever going to be charged with racketeering....and btw, i can probably write off my isp expenses, as well as my computer, my time i put in working on sl, the expenses of my machines as well as any help that i pay...Wow in hindsight this is looking like a great tax break....

Furthermore, there have been many acts of larceny on sl, people setting up scams and stealing 1000's and 1000's of lindens for members accts...if the linden value is equal to 2k or more us that is grand larceny....carries a heavy jail time. I think if they are going to enforce any laws from rl to sl, then those type peope would be the first to be served their subpoenas. anyone thinking that news is gonna change life in sl is kidding themselves imo. The pandoras box that would be opened could never ever be closed!!! jmho

rog

You should also make sure that your casino cashiers can act on behalf of the independent chip brokers so customers can buy and sell at the same official "Pallmor's Casino" window. That way, although they'll *really* be trading with the brokers, your customers will only have to deal with you.

Right. I'm sure the Feds would buy that......

amen...plain and simple. If youl ive in the US, uncle sam get his cut. if he does, everything is gonna be alright...

Rog

Roger, you can be certain that particular 'Pandora's Box' will be opened sooner or later. It's only a matter of time. Whether it happens over the casinos or larceny going on in SL or elsewhere remains to be seen. I know you were joking about writing off your SL operating costs against your RL taxes, but that may exactly be the foot in the door that governments (and not just the US gov't as the internet is world-wide) need. Is it a bad thing? As far as I'm concerned it isn't as internet activity is part of modern life. However I feel it would be prudent for people running SL casinos and businesses to keep accurate business records and to set aside a suitable contingency fund to cover themselves if and when they find a tax demand on their doormat.

Alaz
Hey im all for it, i could use another tax wite off. If this is a legitimate buisness which the us govt would have to accept in order to enforce the laws they are trying to enforce, i would be entitled to write off ANY expense incured while doing buisness. Which would include everything i mentioned and then some. Maybe the gas and time spent shopping at Circuit City to keep myself updated with the latest in hi tech computer equipment. Come to think of it, i do need a new PC to run my SL buisness legitemately...lol...So if this comes to fruition, the fact is i can and will write off every bit of money i spend accesing and working on SL. as its been said before as long as uncle sam is getting his share, I'm good to go. Likewise if im losing money and doing it LEGALY...my uncle sam will let me write off my losses for at least 5 years...God i love this country...and SL!!!!! Bring on Pandora...lol

Be good or be good at it!
Rog

Wow this keeps getting better and better...Guess what? Im now playing Sl for free, my land tier usage fee and monthy fee are 100% tax deductible...Cost of doing biz...thats almost 600$us a year to right off....lets see
600 sl exp
1200 state of th art pc
43680 my salary based on 8 hrs a day x7 days a week for 52 weeks
2000 lease for office space for my buisness (spare room)
1000 annual salary for sl in world employees
2000 advertising
1000 equipment
1000 overhead to include travel and lodging (copmuter gaming conventions, i do wanna stay on top of my game)
TOTAL 52,480

im up to 150US in world for 2006 (includes stipend as well but all income is taxable lol)
good lord...2006's tax return will be incredible
at thsi point im on track for at least a 50K loss.....

this is fun

rog

shhhhhhhh

I don't think I could have said it any better, thought I did try (THE AL CAPONE MESSAGE

1. Everyone should calm down, relax and wait until a definitive answer comes down the turnpike.
   
2. If you are making any sort of profit from SL in RL monies, you should probably be good boys & girls and file the appropriate tax forms.
   

Thanks for listening.

SL truncated my response and I am not going to bother re-writing it. The 2 points sum it up pretty clear.

Bad news. They just went after some UK businessmen and arrested one who was in the US at the time. See http://news.bbc.co.uk/2/hi/business/5190112.stm. If your customers are in the US, you have a problem. Now the Linden servers are all in the US, so I agree that LL will probably have to move on this.

Interesting, as the second most popular places after gambling are generally the sex industry ones. Oh dear.

Sorry man, i didnt read all the thread before i jumped in. So i will say it was an ellaboartion on your post...lol.. and the write offs i mention are all legite...so if your going to playthe govt's game play it by their rules...not all of them are bad

and i agree with you...dont worry until you hear a definitive. which imo is many many light years away....i dont think the irs wants every american with an online biz, taking a loss every year for years. and thats what it will amount to, for those who know the game

and again the word of the day TAXES

a cut and paste from the above articel
A warrant has also been issued for the arrest of Betonsports founder Gary Stephen Kaplan, 47.

He is alleged to have failed to pay federal wagering excise taxes.

HE DIDNT PAY HIS TAXES END OF STORY.....anyone depositing money made from sl into their bank account in in amounts larg enough to raise an eybrow better be paying taxes. And i would imagine, someone correct me if im wrong, since i have never cashed out lindens for US$, but i would suspect a us citizen would get some type 1099 or tax form showing what LL paid you.

IANAL, but the story is not just about tax, though that is a factor in some of it.
Doesn't sound like tax evasion to me.
Just running an online gambling site now seems to illegal if you have US customers. Paying taxes is an obligation on any business that returns real money, but online gambling is now a no-no whatever.

The Feds, when stating "various other crimes" is including a consumer fraud charge regarding the truthfulness of BetOnSports online statement regarding the legality of internet gambling. This is their weakest charge and thus, the strongest and most deadly charge is "tax evasion".

When the US government can't get you through normal criminal laws, they hit you with our monsterous tax code.

Everyone, really, sit back, have a drink on me and RELAX!

Yikes.

Speaking as one of the unfortunates living behind the iron curtain, all I can say is if I were one of you who doesn't live here, I'd cancel any trips to the U.S. that I might have had planned.

Who knows what we're going to do next. *sigh*

Yea this stuff is a very real threat. althought you probably wont hit games because of there own certain rules, they are hitting online casinos because they dont have gambling rights.

It's not so much that I don't think she may have a point because I agree that there could indeed be some level of risk inherent in operating a SL casino, but the overall tone and demeanor in her dire warnings (i.e. The sky is falling!). It's so overly dramatic and puts one in mind of a certain chicken named Little.

Also, please note that I am not the one who made length of time in SL an issue, Anna did. I didn't refute that part of her reply in order to engage in a pissing contest with her as you seem to imply, but to point out that perhaps she would better serve her position in this debate if she refrained from implying that someone who disagrees with her must be a newbie. Juvenile remarks such as those only serve to make her appear to be one who throws a tantrum and calls names when someone doesn't see things her way.

Additionally I am not overly impressed with her repeated implications that anyone who chooses to doubt that the level of risk to SL casino owners is as extreme as she predicts somehow has his or her head in the sand. Likewise, your comment that those who don't see any risk need to "wake up", as if somehow a person who doesn't share your personal observations is somehow asleep at the wheel is no less inflammatory.

I stand by my belief that this issue is primarily a tempest in a teapot.

Yeah "tempest in a teapot" is a not a law of logic, I am afraid.

You are neither bringing new facts to the table nor using laws of logic to reach new or prove false conclusions.

My premise: that casino owners in SL are vulnerable to charges of racketeering. My supporting evidence: "a DOJ spokesman in Washington, Brian Sierra, warned: "We don't comment on potential targets. We view internet gambling to be in violation of federal laws. Those that conduct this business do so at their own risk."

Where is your supporting evidence? Can you link to anything useful here? What logical constructs are you using? Zip.

However, tell you what, I'll do your job for you guys because very few seem to be capable:

http://news.independent.co.uk/business/analysis_and_features/article1185330.ece

"But the wire law doesn't cover other types of casino betting, a federal appeals court in New Orleans ruled. That has left some doubt about whether prosecutors can shut down poker and other casino games that target American players, Cabot said."

My understanding: the DOJ has said that internet gambling businessees are vulnerable to prosecution, but in reality, they may not have a legal standing.

I'm not sure I want to be a test case. Who does?

Yeah, i would imagine this will go the same way of illegal downloading of music off the internet..if it even gets that far. Im still waiting for my supoena for that....I would bet my bottom dollar that the last thing the us govt is worried about is gambling in sl....as far as i know its not a billion dollar a year buisness...yet....far bigger fish to fry...time will tell...

Since the internet isn't really physical space I have to wonder if it is subject the laws of one nation. If your government says you can't run a casino but another government is perfectly fine with it, in cyber space who really has juristiction?

when you live in a state that doesnt have a lottery and you purchase a ticket in a neighboring state that does....guess what, when you drive home. you have broken the law...happens everyday, yet i have seen no news making event about any arrest resulting from the above mentioned crime...things that make you go hmmmmmmmmmmmm...sometimes truth is stranger then fiction...but thats the fact...
be careful out there...

rog