Vegas' deal with gambling site folds

An Internet gambling company that wanted to use the city of Las Vegas' name

and seal withdrew its revenue-sharing offer in November after the deal became

politically shaky.

Jim Jimmerson, an attorney and member of VegasOne.com Inc.'s board of

directors, said using the city's name and seal is a unique way to distinguish

VegasOne.com from the 1,100 Internet gaming sites worldwide. "I think it's

inspired thinking of the board of directors," he said.

For gamblers, the city's name and seal would bring credibility to the

site, he said. A study by the investment firm Bear Stearns and Co. Inc.

reported that gamblers considered a site's authenticity as a factor in using

it, he said.

Although the Internet gaming industry is unregulated, Jimmerson said

the city would have performed a regulatory or oversight function for the

site, resolving possible disputes.

Erik Pappa, a spokesman for the city of Las Vegas, said the city council

questioned whether a government entity could be involved in such a venture.

The council also had reservations about whether the site could prevent juveniles

from gambling, he said.

"What they've told us is they're going to start this Web site without

us, and if in the future the city wants to get into this, we can give them

a call," Pappa said. The company is expected to reintroduce the offer to

the city in six months.

A couple of public hearings on the issue showed no strong public sentiment

for or against the plan, according to Pappa. Three council members, including

Mayor Oscar Goodman, recused themselves from discussions due to perceived

conflicts of interest.

Nevada law bars state residents from gambling via the Internet, but

federal law is unclear, Jimmerson said. VegasOne.com, which has its headquarters

in Las Vegas, would operate out of Australia. In addition, he said the company

has technology in place to preclude U.S. residents and minors from playing.

The company promised the city about 5 percent of gross receipts and

25 percent of the company's annual net profits, which could reach $1 billion

over the next 20 years. According to projections, the worldwide market could

reach $6 billion by 2003, he said.

Jimmerson declined to comment on a similar VegasOne.com partnership

with Atlantic City, N.J.