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Sportingbet PLC has agreed to pay $33 million to the U.S. Department of Justice as part of a plea agreement to avoid prosecution for its former violations of the Unlawful Internet Gambling Enforcement Act (UIGEA). The company was forced to admit that they purposefully flouted the law between 1998 and 2006 by disguising the country of origin of its US customers and by masking payments to them through its payment processing practices.
"This settlement enables Sportingbet to draw a line under events of the past. It is in the best interests of our shareholders and we can now look to the future with increased confidence," commented Sportingbet CEO Andrew McIver.
Despite the high cost of the agreement the market has reacted quite favorably to the news of the settlement. Sportingbet shares rose 14% to 79.3p the morning after the announcement.
"The resolution of any risk associated with Sportingbet's former US-facing business, combined with the considerable actions taken by the Group over the past three years, ensure that the Group is well placed to capitalize on the many opportunities available in the global online gaming industry," said McIver enthusiastically.
The company will now be able to put all of their focus on expanding in the global market and serving their customers. Since the company was found to be in violation of the UIGEA they will no longer be allowed in the US market even if regulation should pass to legalize the practice but with online gambling expanding all across the world this may prove to be just one small bump in the road for the big company.
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