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Facebook, AlertPay Stop Illegal Gambling Through Apps

Written by:
Jagajeet Chiba
Published on:
Jun/17/2009
Facebook

Just two weeks ago, Gambling911.com featured a report on the potential for Facebook applications to result in illegal online gambling transactions.

This week, the company has apparently begun to crack down on this vulnerability. 

From eCommerce Journal:

According to the recent post on the official blog of the online payment system AlertPay, the company negotiated with the social networking site Facebook to terminate several illegal online gambling operations selling virtual poker chips for use on Facebook's "Texas HoldEm Poker" application.

The statement said: "Facebook does not permit online gambling on its platform and some sellers attempted to convert the Texas HoldEm Poker application into monetized online gambling."

AlertPay further stated: "Site offering for sale virtual poker chips for use with Texas HoldEm Poker are in violation of AlertPay's User Agreement and in potential violation of state and United States Federal law prohibiting unlicensed and/or online gambling, as well as the Unlawful Internet Gambling Enforcement Act of 2006 31 U.S.C §5362."

AintLuck.com explained how the Facebook applications work:

"Users of the applications such as Zynga's Texas Hold ‘Em, the poker application of choice and the largest such software on the social network sites, would find this to be quite strange, since after all, they are not playing for real money and have no way of depositing or withdrawing fake funds.  However, legal experts that have been reviewing the laws as are currently constituted point to the presence of virtual ‘gifts', items that members can send to other members for trading in some of their play money to attain.  For example, Facebook allows players to send up to 16 "gifts" to other Facebook users per day.  The intent of the gifts are to promote the application and to encourage other people to take part in the games.  The "gifts" cost $5-$10 virtual dollars and are not actual physical items, more of a status symbol that appears on news feeds or a Facebook person's ‘wall'.

Jagajeet Chiba, Gambling911.com 

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