March 29, 2001 New York Times, Technology Section

Bettors Find Online Gambling Hard to Resist

By MATT RICHTEL

NAHEIM, Calif. -- The plastic white magnolias just inside the front door of Cheryl G.'s one-bedroom apartment here are impeccably arranged. She has carefully bent each petal to make them seem more natural.

She keeps the carpets freshly vacuumed. And she fixes the flowered bedspread so crisply each morning that hospital administrators would applaud. Those touches reflect the control that Cheryl G., 48, ordinarily exhibits in her life.

But the Internet unwound her — completely. In one month.

A novice gambler, she started playing slot machines over the Internet in February. When her spree ended — after she had lost around $12,000 and her credit cards had no credit left — she plopped down on the meticulously made bed for two days and contemplated plunging her Grand Am, and herself, into the Pacific.

"You just keep clicking, and clicking, and clicking the button," said Cheryl G., a furniture saleswoman whose losses are almost half of the $28,000 she earned last year. "It was a euphoria. It was like reality didn't exist."

For millions of Americans, Internet gambling is a reality. Around 5 percent of Internet users have gambled online — 4.5 million Americans all told — and 1 million do so every day, according to a study last year by the Pew Internet and American Life Project. Players are logging on to 1,300 or so sites, often based in the Caribbean, that seek to project the look and sounds of actual casinos or betting parlors. They offer a slot machine, a blackjack table or a sports book, all as readily accessible as the nearest phone line.

It does not matter that the activity is unregulated in the United States or, depending on the state the gambler is in at the time, even illegal. Or that some banks will not allow their credit cards to be used for online gambling. To players, Internet gambling is, above all else, convenient. For some, wagering via modem means that they need not make their way to an Indian casino or a riverboat, or to Las Vegas or Atlantic City. It means that they need not get dressed. Or tell a spouse. Or face the shame of losing large sums in public. It also means that they can win a lot, and quickly.

Cheryl G., whose struggle is still unfolding, is not necessarily typical. But the data on Internet gamblers are only emerging. The Pew survey, conducted last June, found that Internet gamblers, as a whole, were less educated and older than the Internet population at large and that as many women as men gambled online. A Bear Stearns report this month found that at two popular Internet casinos, women outnumbered men among the patrons, and that online gamblers tended to be less affluent than Internet users in general.

A Web gambler's risk is not limited to the games themselves, said Marc Falcone, Bear Stearns's gambling analyst, who estimated that 35 percent of Internet casinos might not pay what they owe or might fiddle with the odds in an underhanded way. But he said gamblers, apparently undeterred, wagered $1.4 billion online last year on casino games, lotteries, horse races and other sports events — a figure that Bear Stearns expects to grow to $5 billion by 2003.

The gamblers also risk addiction. The number of addicted gamblers on the Internet is on the rise, said Tom Tucker, executive director of the California Council on Problem Gambling, a nonprofit group.

Unlike Cheryl G., some regular gamblers say they play in moderation to enjoy themselves. They sometimes find profit, they say, and they sometimes find escape. And as with bricks-and-mortar casinos, the relationship between the gambler and the house is one of both love and hate.

"There are a lot of shady operations," warned a regular gambler, Elizabeth M., 48. "They are so deceitful." But she has a choice of gambling or boredom, she said. "There's nothing else to do here except go to work and church," she said.

"Here" is a Mississippi town of 2,500 residents, a straitlaced place where alcohol sales are illegal. And for Elizabeth M., there is not even work: she left her job in a printing plant on disability because of a degenerative eye disease. (Like Cheryl G., she agreed to talk to a reporter about her gambling on the condition that she not be fully identified.) She started gambling 18 months ago when a friend took her to riverboat casinos in Mississippi and she discovered slot machines. In the following weeks, she searched the Internet for casinos and found many, along with numerous ads beckoning her with promotions, like offers to match the first $100 a gambler spends with $35 from the house.

Elizabeth M. bit hard. Several days a week, sitting in front of a computer screen equipped to enlarge the text because of her poor eyesight, she deposits $100 using her MasterCard into casinos with names like Floridita Club (which promises the "heady atmosphere and decadent glamour" of old Havana) and Astra. She plays slot machines and card games.

Her gambling money, drawn from her disability pay and investment income, does not last long. "I play for maybe an hour or two," she said. She plays for the thrill of a big hit, she added, and some days she does cash in. All told, she said, she lost $1,000 in the last year.

When she does win, she knows that she will not be paid for at least 24 hours; most casinos hold winnings for one to five days before they will issue a check or send a wire transfer. The casinos say this is their way of making it convenient for players who want to return to gamble more. Elizabeth M. says everyone knows the real reason: a regular gambler will get the bug before 24 hours expire and use that money to place more bets. That is akin to making the exits tough to find in a Las Vegas casino.

Her theory is backed up by Michael L. Jeung, who knows a lot about losing track of casino exits. "Anyone who tends toward compulsive gambling knows you're going to go back for the money," said Mr. Jeung, 45, who has gambled for 25 years and visits Las Vegas and other gambling destinations four times a year.

He does not like to think of himself as a compulsive gambler, but he is at least a committed gambler. In 1998, he lost $41,000 gambling, $30,000 of it on the Internet. In 1999, he quit gambling online. But last year, the bug hit again.

Continued 1

-- Lars (larsguy@yahoo.com), March 29, 2001

Answers

March 29, 2001

Bettors Find Online Gambling Hard to Resist

(Page 2 of 2)

Little wonder, perhaps, since Mr. Jeung, a software salesman, loves games. He is an avid golfer. He once bowled a 300, and he wears a thick ring from the American Bowling Congress to commemorate it.

In Mr. Jeung's rented apartment, in the working-class suburb of Hayward, across the bay from Silicon Valley, boxes and shelves are filled with secondhand electronic equipment. The plastic sides of his computer monitor, a used unit he picked up a decade ago, are badly cracked. He purchased the laminated wood desk in his home office for $30 from a surplus store. On it, along with food stains, are giveaways from actual casinos he has enriched, like a plastic Harold's Club cup that holds highlighter pens and scissors.

Mr. Jeung, who earns around $100,000 a year, takes pride in his thrift and his capacity to make the best of orphaned electronics and furniture. But he has also been forced to be frugal because of his gambling losses, he said, lamenting that his habit has cost him the money for a down payment on a house.

And 2000 did not help matters. As the holidays approached, his online gambling losses for the year were $28,000. The culprit was blackjack. On his 20-inch monitor, it is easy to imagine cards being dealt on plush green felt. There are even the sounds of a casino, like background chatter.

But two factors make it seem less than real. The action is faster than at an actual casino, where the deck must be shuffled. And Mr. Jeung does not feel as if he is playing with actual money. "It's not like you're holding stacks of $100 bills," he said. "You just click the betting button." Playing blackjack in person, he bets no more than $200 a hand; online, his bets were often $800.

The high-speed action cuts both ways. Late last year, matters took an exciting turn. Mr. Jeung got hot. His three-month tear through the 7Sultans Casino, The Gaming Club and Prestige Casino left him up $42,000. On one day, he won $18,000. During the streak, he gambled secretly in the middle of the night while his fiancée slept. When she left for work, he would log on again.

Not long ago, Mr. Jeung told his fiancée about his gambling habit — though not its extent — and resolved to change his ways before his luck soured again.

"I intend to severely limit my Internet gambling," he said. While conceding that he had not stuck to previous efforts to abstain, Mr. Jeung added, "I've got a second chance, and I want to make the most of it."

A second chance is also what Cheryl G. is seeking.

A year or so ago, her plight might have been hard to foresee. Even though she had had her share of troubles — two divorces, and a battle with excessive drinking 20 years ago — her life was running relatively smoothly. She had become engaged, and her habits — cigarettes, tanning salons, television — were easier to manage.

Early last year, she moved to Southern California because of her job, and a friend took her to an Indian casino and introduced her to gambling. Before long, she was going twice a month and spending $900 or more on slot machines. The gambling distracted her from her loneliness, she said, because she had moved away from her two grown children and her fiancé.

Laid off when her company closed her office late last year, Cheryl G. began gambling online. On some days, she gambled for 10 hours, downing Diet Pepsi and chain- smoking Viceroys.

Gambling felt different than it had in the casino, she said. She felt no public embarrassment when she lost. She maintained an appearance of order — dusting the apartment, cleaning out the ashtray after every six or seven cigarettes. It was gambling, but anesthetized gambling.

Now the pain is setting in. Lately, Cheryl G. slinks to the mailbox to see if a new credit-card bill has arrived. She is not sure how much she lost, she said, until she opens the statements. "I don't remember making half of these bets," she said. "When you're in the middle of it, you just keep going."

After about a month of heavy gambling, she found Gamblers Anonymous. At her first meeting, she said, she stood up and bawled. She vowed to take her battle against gambling addiction one day at a time. And for two weeks, she did. Then, when her fiancé was visiting, she downed several drinks and proceeded to lose $500 using his portable computer.

"The laptop," she said, "was just sitting there."

-- Lars (larsguy@yahoo.com), March 29, 2001.

Where have you been? Internet gambling has been around almost as long as the WWW.

-- (been around @ for. years), March 30, 2001.

I can't think of a more foolish way to waste your gambling dollars than to play a virtual slot machine in an unregulated offshore virtual casino. Without a mandatory adherance to regulations, these "casinos" can do whatever they wish with their games.

The same applies to cruise ship casinos. Once they leave the US shore (12 miles out?) they are outside of any gaming regulatory body. I'm reminded of the slot machine I once saw which had previously been located in a cruise ship casino. When the reel mechanism was removed we saw they had attached a washer about the size of a quarter to the inside of a "slot", thus preventing the reel from stopping at that specific point. The slot corresponded with the "7" symbol. In other words, the cruise ship had intentionally (and deceiptfully) made it IMPOSSIBLE for the player to win "the big jackpot". Definitely tacky and dishonest but not illegal on the high seas.

-- CD (costavike@hotmail.com), March 30, 2001.

The phenonenon of addiction, especially non-substance addiction like gambling, is intriguing. Why are 5% of the population so compelled to do something they know to be self-destructive, over and over? Rhetorical question, I know.

-- Lars (larsguy@yahoo.com), March 30, 2001.