The Financial Times

By Stephanie Kirchgaessner

6 October 2006

PartyGaming, SportingBet and other online UK-listed gaming companies paid millions of dollars to Washington lobbyists linked to Jack Abramoff, the notorious super-lobbyist, to help them thwart US anti-gambling legislation.

Mr Abramoff's highly public fall from grace and conviction on criminal corruption charges earlier this year – and the downfall of many of his associates – opened the door for the passage last weekend of a law that he and the companies staunchly opposed.

The passage by Congress of the Unlawful Gambling Enforcement Act has drawn accusations of US protectionism and the suggestion that the law was driven through by conservative Republicans.

However, lobbying records analysed by the Financial Times show that the companies were closely connected to Mr Abramoff and his team – the same men whose political ties, for years, played a central part in helping insulate the gambling industry from laws and regulations.

The demise of Mr Abramoff and his colleagues substantially weakened the gambling companies' political hand in Washington, paving the way for the bill's passage.

SportingBet spent $2.2m (£1.17m) from 1998 to 2005 lobbying Washington lawmakers on issues involving online gaming, according to figures compiled by the Center for Public Integrity, which tracks lobbying, and other public filings.

Among other lobbyists, the company hired: Tony Rudy, a former aide to ex-congressman Tom DeLay and who has pleaded guilty to bribery charges in connection to the Abramoff scandal; and Neil Volz, a former congressional chief of staff who has also pleaded guilty to bribing his former boss, Congressman Bob Ney. SportingBet declined to comment.

PartyGaming, the largest online gaming website, initially declined to disclose who their lobbyists in Washington were, but when presented evidence acknowledged that the company was and is currently represented by Gibraltar-based International Interactive Alliance (IIA), a company that formerly had close ties to Mr Abramoff.

Although most of the public scrutiny of Mr Abramoff's wheeling and dealing in Washington has been centred on his work on behalf of Native Americans' gambling interests, records show that the IIA, which hired Mr Abramoff in 2003, was a lucrative client of the former lobbyist. Over just one and a half years, IIA paid Mr Abramoff's firm, Greenberg Traurig, $1.3m for Mr Abramoff's services. In all, IIA has spent at least $1.9m on its lobbying campaign, and continues to be represented by Greenberg Traurig.

When asked directly whether PartyGaming lobbied in Washington through the IIA, a spokesperson for the company initially defended the IIA by saying it was an "industry group" with high standards.

"It has not been lobbying like the horseracing industry in that it has not put money into congressional races. [Instead, it uses] good old-fashioned talking to people and presenting the arguments," a spokesman said.

But in the exhaustive investigations into Mr Abramoff by Republican Senator John McCain, there is evidence that IIA had a particularly close relationship with Mr Abramoff.

In 2003, the IIA transferred to Greenberg Traurig, Mr Abramoff's former firm, $1.25m. According to congressional testimony, the payment was later passed on to KayGold, a company Mr Abramoff controlled.

Asked about the payment, PartyGaming said: "Jack Abramoff's actions made the IIA one of his victims. Hindsight is easy, if we knew what we know now, then we wouldn't have even taken Jack Abramoff out for a cup of coffee."