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    Web-site gambling advertising targeted

    By L.A. Lorek
    San Antonio Express-News

    Web Posted : 01/09/2004 12:00 AM

    The Department of Justice has issued a subpoena to Clear Channel Communications and other media companies regarding advertising by illegal Internet gambling sites.The assistant U.S. Attorney for the Eastern District of Missouri subpoenaed the San Antonio-based media giant on Sept. 9 regarding commercial advertising run by the company on behalf of offshore Internet gambling businesses including sports bookmaking and casino-style gambling.

    Clear Channel said Thursday that it is cooperating with Justice Department officials.

    Clear Channel disclosed information about the subpoena in filings with the Securities and Exchange Commission.

    A spokeswoman with the U.S. Attorney's office in Missouri declined to comment except to say that no indictment has been issued for Clear Channel.

    The Justice Department issued several subpoenas that targeted Web sites, radio and TV broadcasters, magazines, newspapers, sports information networks and others, said Lawrence G. Walters, an attorney who represents several offshore Internet gambling clients.

    The subpoenas request all records pertaining to advertisements by Internet gaming establishments dating back to 1997, said Walters, who has received a copy of the subpoena from one of his clients.

    Along with the subpoena, the Justice Department sent a warning letter to all major radio broadcasting networks suggesting they could be in violation of the law by accepting Internet gambling ads, which could open up media outlets to criminal charges of "aiding and abetting," Walters said.

    The subpoenas have had a "chilling effect" on advertising for offshore Internet gambling businesses, he said.

    It has been quiet since the subpoenas were sent out in September, said Nelson Rose, a professor with Whittier Law School in California. He knows of several people who received subpoenas but haven't heard anything more since then.

    Gambling on the Internet is illegal in the United States under a 1960s law that prohibits using a "wire connection facility" to place a bet across state lines.

    Congress introduced a bill last year aimed at further curtailing Internet gambling, but it has stalled. The bill would prohibit credit card providers from processing transactions involving online gambling. Many credit card companies have already voluntarily stopped processing those transactions, said a spokeswoman with the American Gaming Association.

    Despite U.S. restrictions, online gambling became a $6.3 billion industry last year and is projected to reach $7.6 billion this year, according to Christiansen Capital Advisors LLC.

    A Congressional report estimates there are between 1,500 and 1,800 Internet gambling Web sites, virtually all of which operate from computer servers in the Caribbean and other jurisdictions outside the United States.

    An estimated 50-70 percent of Internet wagering comes from the United States despite the fact that no state permits Internet gambling and only one state, Nevada, permits general sports betting at all, according to the Congressional report.

    Broadcasters need to comply with government requests to stop accepting Internet gambling ads, Rose said, because if they don't they might jeopardize the renewal of their Federal Communication Commission airwaves licenses.

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