 Catherine Hanaway:
Gambling911.com
Person of the YearWho can argue that nobody has had more of an impact on Internet gambling this past year than U.S. Attorney for the Eastern District of Missouri, Catherine Hanaway. US-facing online gambling establishments, European gaming firms, banks and even Google have come under the ire of Ms. Hanaway in 2007. The industry has never dealt with a bigger threat than Hanaway. Politicians have been working to quash online gambling since 1997, finally succeeding to some degree in 2006 with the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA). But even before its passage, the one time Missouri House of Representatives hopeful, Hannaway, had begun her pursuit of undermining the Internet gambling landscape by prosecuting the industry's number two US-facing firm, BetonSports (by most accounts, an in debt company run by shady British suits). That was in July 0f 2006 and these actions served as a precursor for even bigger things to come.
U.S. Attorney
Catherine Hanaway
told The Associated
Press that
BetOnSports must
return any money
that American
customers have tied
up with the site,
something the
company is yet to
abide by. Hanaway has seemingly been waging a one woman war.....and winning. Paralyzes Online Gambling Industry at Start of 2007 Hanaway's actions most certainly put into motion the downward spiral of online gambling third party payment processing firms. An investigation into the largest, Neteller, began around the same time the BetonSports indictments were announced. Announcement of charges brought against two of Neteller's co-founders - the story of which was first broken by Gambling911.com - sent shockwaves throughout the industry. While a number of large publicly traded European i-gaming firms pulled out of the US market immediately following the passage of the UIGEA last October, it wasn't until Neteller and other money processing companies were forced to retreat that the online gambling industry became stifled, for a better part of six months, and still hasn't fully recovered. Hanaway's relentless pursuit led to fines brought against the likes of search giants Google, Microsoft and Yahoo! for featuring online gambling ads on their respective websites. She's spoke out against the legalization of Internet gambling at Congressional hearings and managed to reel in BetonSports founder Gary Kaplan last spring, nearly nine months after charges were filed against him. In all, Hanaway has demonstrated she won't be pushed around by the World Trade Organization (which claims her actions are against a ruling made in favor of the tiny island nation, Antigua, related to Internet gambling), she won't have international businesspeople bragging about how they can skirt around US law (British national David Carruthers is currently under house arrest in Missouri as part of the case against BetonSports) and she's not afraid to take on the biggest corporations in the world (Google, Microsoft, Yahoo!).
The online gambling industry as a whole despises her, and this is probably not news to Ms. Hanaway. Howard Beale of FiredUpMissouri.com echoed their sentiment recently:
Has she been
carefully using her
law enforcement
office to do favors
for and ingratiate
herself to key
Republican power
players in return
for soft commitments
of support in her
expected bid for
Attorney General? But in reality, Hanaway may very well be doing her job and - when it comes to online gambling - it's a job she believes in, one she's been effective at...bringing the industry to its knees. Hanaway started her crusade in the 4th grade, taking on the Catholic Church. Hanaway and a friend wrote a letter to their priest asking if the church's policy could be changed. He took them out of class and explained they were out of luck. "We got nowhere fast," she said with a laugh. "He seemed rather upset that we took such a direct approach."
Hanaway works with a
sense of urgency.
Every moment is
precious. While
other lawmakers are
out hobnobbing with
lobbyists, she can
be found at her
Jefferson City
apartment caring for
her daughter, Lucy.
In 2001, while assisting with President George W. Bush's campaign in Missouri, union leaders dropped off three rats at Bush's Maryland Heights office to mock a controversial Republican TV commercial. Hanaway put the rodents in a laundry basket and hung a sign that read, "Al the bureaucRAT."
Hanaway attended the
University of
Missouri at Columbia
to study broadcast
journalism. She got
involved in student
government, backing
David Ayres in his
bid for a campus
post. Ayres later
became Sen. John
Ashcroft's chief of
staff. After three
years at Mizzou,
Hanaway left for
Creighton University
in Omaha, Neb.,
where her mother was
the director of
student health and
tuition was free.
Hanaway does not like online gambling (also known as offshore gambling). Her concerns, as mentioned in Hanaway's Congressional testimony, stem from fears of minors gambling online and of compulsive gamblers. Legitimate industry operators insist that they take extra precautions in preventing minors from accessing the "real money" platforms of their respective websites, and most do. Make no mistake about it. But a 60 Minutes report that aired last year showed that for every four responsible online gambling companies, there is one that does not exercise proper controls. Hanaway, unlike some of her colleagues, has already proven herself one to campaign aggressively for children's rights: After all, she was credited with reforming Missouri's adoption laws to protect abused children. As for concerns over compulsive gamblers, setting up a business as "post up" (requiring money on hand in which to gamble with) is indeed an important step towards running a responsible gambling establishment. The online gambling industry as a whole prides itself on being a "post up" business. But time and time again we read that dozens of offshore gambling firms allow for credit betting, and herein lies the potential for problems. Many would argue that Hanaway's actions have driven these legitimate businesses underground (or in the case of Euro i-Gaming firms, back to Europe). But her policy has been mirrored at the local levels where even the so-called "underground" offshore gambling groups have not been immune. Local law enforcement has been taking down one operation after another and -unlike in past years - there is no longer just a slap on the wrist. "They (District Attorney's office in Queens) has ruined my life," said one low-level defendant caught up in a bookmaking sting earlier this year that extended offshore to the island of St. Marten. "I'm looking at four years behind bars or they're going to ensure I go broke." A gambling offense - however minor - is likely to seriously disrupt a person's life during this post-9/11 era, and Hanaway's efforts serve as the milestone for local law enforcement. When Catharine Hanaway brings up "money laundering" and "fraud" during her testimony, her words are backed by actual evidence. Nearly every high profile "localized" gambling bust now traces to an offshore wire room in Costa Rica. This is money moving offshore that is not being traced. Hanaway set her sights on companies that bragged about taking millions of dollars from US citizens without having to pay taxes: These would be the publicly traded European i-gaming firms, which made the US Attorney's job that much easier by publishing how much money they squeezed out of the US economy year after year. A billion dollar industry that is more than 80 percent reliant on the US economy is not likely to go unnoticed by the US government, especially when virtually zero of that money is being taxed. One online gambling operator out of Costa Rica, who wished to remain anonymous, told Gambling911.com last year that representatives from the US Treasury informed him it would go a long way towards legitimacy for his business to provide customers with W-2 forms where they can claim their own taxes. A careful analysis of what got BetonSports into hot water demonstrates just how ill-conceived their company policy had become in the face of many years where the US government took a "sit back and watch" position in regard to online gambling. The evidence against BetonSports includes radio advertisements in which the company describes itself as "legal and licensed" (which they were in Costa Rica, but not Missouri), marketing material sent to an address in the suburbs of St Louis (mail fraud) and - the ultimate in audacity - an undercover sting on a van used by the company to solicit bets outside big sports stadiums. The company's then CEO, David Carruthers, regularly appeared on national news shows touting how BetonSports was essentially "above US law" and could do what it wants under the company's own defined guidelines. Wrong! He was detained in July 2006 attempting to board a plane in Fort Worth, Texas.
Ms Hanaway has been
reported by local
media as comparing
BetonSports'
book-running to the
illegal smuggling of
pornography or drugs
into America. She
insists she was
referring to the
views of others and
is being purely
pragmatic. "In no
way are we making
any judgment about
whether this should
be illegal. It is
illegal. This
company avoids
paying a significant
amount of wage tax
and excise tax that
would be due if it
were legally
operating." Likewise, Hanaway remains one of the biggest roadblocks in preventing these European firms from entering or re-entering the US market. Party's move has caused banks to thumb their noses at them. Acquisitions are hard to come by as a result. Catharine Hanaway has single-handedly instilled a fear in the online gambling community like no one else has in the past. To say she has influenced the current course of the industry would be a huge understatement. It is with this reason that Catherine Hanaway has been chosen Gambling911.com's first ever "Person of the Year". --- Christopher Costigan, Gambling911.com Publisher CCostigan@CostiganMedia.com Originally published December 21, 2007 12:53 am EST
|
Who
Is Catharine Hanaway
Anyway?
A Method to Her
Madness