Party in trouble??

[aloiz]

what do you guys think??

From http://deccanchronicle.english.indiapress.info/

Gambling under BPO veil


Hyderabad, June 24: It describes itself as a “leading business process outsourcings company engaged in software development and IT-enabled services”. “We pride ourselves in working with a few select e-commerce clients engaged in unusual, interesting and rapidly growing businesses — and delivering them a whole suite of services to support their entire operations,” says the web site of the Hyderabad-based IVY Com-ptech Private Ltd.

The “unusual and interesting” business centres around one thing alone: online gambling, which is an illegal activity under Section 67 of the Information Technology Act of 2000. The earning is in the range of $3 million every day. IVY Comptech owns and operates a clutch of online gambling sites, which are serviced from its offices in Ashoka Bhoopal Cha-mbers in Secunderabad. IVY Comptech has over 750 people working for it in Hyderabad, who promote and service such web sites as partypoker.com, partybingo.com, starluckcasino.com and planetluck-casino.com.

Officially, the gambling websites are owned by iGlobalMedia Global Entertainment, Inc, and promoted in 1997 by two Indi-ans, Anurag Dixit and Vikrant Bhargav, and an American woman, Ruth Parasol. The company was based in Santo Domingo, capital of the Domi-nican Republic. But investigations reveal that partypoker.com is in fact owned and operated by IVY Comptech. Anurag Dixit, an IIT graduate, is the designated “contact person” at IVY Comptech, according to the Software Technology Park, Hyderabad. IVY Comptech has also leased one MB of bandwidth from STPI, according to STPI director Col M Vijay Kumar.

Internal emails from Anurag Dixit, made available to Deccan Chronicle, to his colleagues in both IVY Comptech and iGloba-lMedia, include one which deals with the departure of Steve Heller as CEO of both the companies. According to sources familiar with the development, Heller was fired in May and his email gives the Hyderabad “BPO” office number as well. PartyPoker has since named Prasad Kundru, a former IAS official and classmate of Vikrant Bhargava at the IIT, as CEO.

And in a live-chat on the partypoker.com website on Wednesday night, “Rajesh” of partypoker revealed that he was based in Hyderabad. Partypoker.com offers a slew of card-games, including Seven Card Stud, Seven Card Stud 8 or Better, Omaha High, Omaha 8 or Better and Texas Hold’em. According to sources familiar with the games on partypoker.com, over 40,000 people play at over 1,100 “tables” online, during peak hours.

“The minimum amount of money required to play on partypoker.com is $50, while there is no upper limit. The games generate a daily revenue of $3 million, of which the commission for the organisers works out to $8,00,000,” said the sources. Other online gambling sites like starluckcasino.com reportedly generate $2,50,000 in commission to the organisers. However, such figures are difficult to confirm, because the money, in dollars, never enters India.

“The organisers have bank accounts in several countries, and the money is constantly shuffled between them,” the sources said. Partypoker.com guarantees the security of its gambling transactions online. The certificate is issued by BMM International. “BMM International has evaluated the multi-player poker system and its associated games hosted by iGlobalMedia and verified that they comply with the relevant Kahnawake Gaming Commission technical requirements,” says BMM director W Hugh Monypenny on the BMM web site. IGlobalMedia apparently has a license from the Kahnawake Gaming Commission to operate the games.

The Kahnawake is a native tribe in Canada. Native Americans and Canadians, who have their own reservations, are centres for gambling because the federal laws of the respective countries do not apply to the reservations.



Staff Training
According to the sources, IVY Comptech, founded in 2001, has been rapidly expanding its illegal online gaming operations in the past one year. “The company has four divisions to handle software development, technology, payment processing and marketing and customer support. There are over 270 people in customer support, and about 150 in marketing,” the sources said.

Apparently, IVY Comptech takes the training of its people seriously. It brings in cardsharps from around the world to train the customer service staff, who need to deal with angry gamblers, either on the phone, email or live chat. One such trainer was Michael O’Malley, who describes himself as a “consultant” to IVY Comptech. Malley, a cardsharp who maintains a web site of his own, was in Hyderabad earlier this year to conduct a poker “tournament” for the company’s staff (see picture). Winners were given gift coupons worth over Rs 15,000 from Life Style.

“Bhargava, who is now in Gibraltar, and Dixit have also hired iGlobalMedia’s former employees in the Dominican Republic. Ten of the Dominicans are in Hyderabad as fulltime employees. Their main job is to train IVY Comptech’s staff in card games. In short, the employees spend most of their time sharpening their skills at poker, the better to answer queries from online gamblers,” the sources said.
IVY Comptech reportedly hires people by offering them more than a 40 per cent jump from their previous salaries.



Tax Issues
By promoting and hosting illegal online gambling, IVY Comptech could be in violation of several laws in the country, one income tax expert said. “First of all, as an STPI-registered exporter of software and services, it needs to account for the foreign exchange, under the Foreign Exchange Management Act. Obviously, this cannot be done, because the business is illegal gambling, and the proceeds are largely collected overseas and parked in banks abroad,” he said.

“The scale of the operations is awesome. With a volume of $ three million per day, the online gambling business will be generating close to $3.6 billion this year, of which eight per cent is the commission which the organisers will get,” the sources said. “But the Indian tax authorities will not be collecting even one dollar from PartyPoker.com and its organisers.”

[BradleyT]

$3,000,000 a day. Must be nice.

[Baulucky]

The only ones in trouble are the poor Indian guys that labor in Party and that would be without jobs if anything happens. The Gov't of India can't do anything of major consequence to Party, i.e.: all assets, etc. are out of reach. IMHO, of course.

[mbpoker]

If Indian goverment will tell Party - pay taxes or out, it's not going to be easy to move the whole operation to another location.

[Sponger15SB]

[ QUOTE ]
If Indian goverment will tell Party - pay taxes or out, it's not going to be easy to move the whole operation to another location.

[/ QUOTE ]

just flew under the radar of my sarcasm detector, however i checked it again and it turns out that scored a 9.9 out of 10

[Soleo]

"Illegal, illegal, illegal..." Where? In India or USA? OK, let's move out there. It's so interesting for every country revenue service when current or former residents/businesses are getting rich. Hope that these guys/girl are smart enough to organize their business and place their assets well. Because I depend on their smartness being Party customer [img]/images/graemlins/smile.gif[/img]

[BoatLover88]

I especially like the references to numbers that don't exist such as $2,50,000 as well as $8,00,000