Russian bookies face the axe; online gambling legislation due in February?

russia-betting-shop-axeRussia is seeking to amend its already restrictive gambling laws to allow regional governments to ban bookmakers. In 2007, regional governments were permitted to ban betting shops within their jurisdictions, and 17 of them opted to do so. But so long as a bookie held a federally issued license, they were allowed to continue operating in these regions, regardless of what the local government wanted. In 2009, when Russia banished casino gambling to four geographically isolated jurisdictions, these 17 regional governments were given the option of lifting their toothless bookie bans, and five of the 17 exercised this option. The other 12 – including Dagestan and Chechnya – stuck to their toothless gums, er, guns.

Now the Russian Federation’s Ministry of Finance has proposed amending the law to let these regions put some bite into their anti-betting bark. Oleg Zhuravskiy, who heads the local bookmakers’ trade association, told the BookmakersRating.ru site that the enforcement of these bans could result in the closure of 400 to 500 betting shops – about 10% of Russia’s total complement – and the redundancy of up to 3k employees, not to mention the loss of tax revenue for these regional governments.

But just to confuse the matter, a different draft of the same amendment would require the ban-happy regional governments to follow the path laid out by the freewheeling five regions that lifted their bookie bans in 2009, meaning the sports betting shops might yet be spared the axe. Confused yet?

Zhuravskiy also said he expects the Russian government to introduce legislation that would allow Russian bookies to take their action online, while simultaneously instituting a blanket ban on international online gambling sites serving Russian punters. Regional courts have long ordered internet service providers to block specific sites, but Zhuravskiy envisions a countrywide scenario like that in Italy or France, in which international companies could only continue doing business in Russia if they possessed a local license. Zhuravskiy expects such legislation to be on lawmakers’ desks by February 2014.

IN RUSSIA, PROSECUTORS DO DEFENSE ATTORNEY’S JOB
Two former Russian Interior Ministry officials arrested in 2011 for allegedly taking bribes from illegal casino operators won’t face further court proceedings after the country’s Supreme Court upheld an earlier ruling that the arrests had been unlawful. Farit Temirgliyev and Mikhail Kulikov were arrested in June 2011 as part of an investigation into a ring of illegal casinos in the Moscow region run by businessman Ivan Nazarov, who was allegedly bribing public officials to warn them in advance that police raids were in the offing. Underground casinos have bred like bunnies since the 2009 crackdown, in large part because the four designated casino zones are inaccessible by most Russian gamblers.

At the time the Interior Ministry officials were arrested, the action was widely perceived as the result of a turf war between the Investigative Committee and the Prosecutor General’s Office, which had been split into two separate government agencies the previous year. The Investigative Committee originally launched the action against the city’s underground casino market, only to have their investigation quickly shut down by the Deputy Prosecutor General. The internecine squabbling became so toxic then-President Dmitry Medvedev chastised both parties for airing their dirty laundry in public.

This September, the Supreme Court ruled there had been no basis for the arrests, a ruling that was immediately challenged by Investigative Committee officials, who claimed the ruling would scupper future prosecutions of the eight other individuals connected with the case. Earlier this month, media outlet Kommersant reported that the Supremes had upheld their own ruling on technical grounds, as appeals are only legally available to members of the Prosecutor General’s Office, the defendants or the actual victims of the case.

Former Moscow Region Deputy Prosecutor Alexander Ignatenko was released from prison in July after the term of his pre-trial detention expired. Ignatenko had fled the country for Poland in the wake of the 2011 crackdown, only to be arrested by Polish authorities for holding a bogus Latvian passport and extradited back to Mother Russia in February 2013. Ignatenko was released after investigators determined they didn’t have enough evidence to convict him, opting instead to return the case to the Investigative Committee for further study.