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USAMitch Garber says he’s not afraid to travel to the United States. If it was me, I’d find other places to visit.

Garber is the Montreal lawyer and businessman who was chosen last spring to head the world’s largest online gambling company - Gibraltar-registered PartyGaming PLC.

Last week, PartyGaming reported its first full financial results since Garber became chief executive, and the numbers were terrific. After-tax profit in the first half of the year surged 74 per cent to $298 million U.S. The company said it’s adding a mind- boggling 3,000 new players a day on its websites, including the world’s most popular poker site, PartyPoker.
How did investors react to all the good news? They sent Party-Gaming’s stock down 10 per cent in London.

It turns out PartyGaming had the bad luck to bring out its results on the same day a second international online gambling figure was nabbed in a U.S. crackdown on Internet betting.

It wasn’t only PartyGaming’s stock that took a hit. About $1.5 million U.S. in market value evaporated from online gambling stocks in London after the arrest of Peter Dicks, chairman of Sportingbet, at New York’s JFK Airport on Thursday.

PartyGaming derives almost 75 per cent of its revenue from the United States, but Garber was quick to note his firm has never accepted bets on sporting events from Americans. The distinction is crucial, he explains, because it’s sports betting that is explicitly prohibited by the 1961 Wire Act, the law used against Carruthers.

PartyGaming hasn’t had notification from U.S. authorities that it’s under investigation, and Garber isn’t prevented from travelling there by company policy. But he has no plans to visit in the near future.

As a member of the FTSE 100 index of blue-chip British companies, “we would hope if the Department of Justice thought we were doing something improper they would notify us,” says Garber, whose first-year pay packet was estimated at $17 million when he was hired by Party-Gaming in March.

Before joining the company, he was executive chairman of FireOne Group, a subsidiary of Montreal’s Optimal Group, which does payment processing for 300 online gambling operators.

Even before the U.S. arrests, his focus at PartyGaming was on markets outside the U.S., where revenue grew 150 per cent in the last year. Last month, the company announced it was spending $130.5 million U.S. to acquire Gamebookers, a totally non-U.S. sports-betting operation based in Bulgaria. PartyGaming is also looking at Asia and especially the lucrative Chinese gambling market.

Garber wants to see the U.S regulate and tax online gambling like the British government has decided to do. But Washington and the states appears to have different ideas.

It’s little wonder, then, that the online gambling industry is making travel plans for more welcoming locales.

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