FBI Investigators Visit Second Life’s Internet Casinos

Although the US government is still undecided on the legality of virtual gambling, FBI investigators visit Second Life’s Internet casinos at the invitation of the virtual world’s creator Linden Lab.

Linden Lab's general counsel and Vice-President for business affairs, Ginsu Yoon, said, "We have invited the FBI several times to take a look around in Second Life and raise any concerns they would like, and we know of at least one instance that federal agents did look around in a virtual casino."

Yoon also stated that the company was seeking guidance on virtual gaming activity in Second Life, but had not yet received clear rules from US authorities.

Second Life is an online virtual world offering poker, slot machines and blackjack, with millions of registered users and its own economy and currency, known as the Linden dollar, which can be exchanged for US dollars.

According to casino owners, it is hard to estimate the total size of gambling economy in Second Life; however, the three largest poker casinos are earning profits of $1500 each per month.

Lawyers believe that placing bets with Linden dollars violates US anti-gambling statutes, which cover circumstances in which 'something of value' is wagered.

Brent Britton, an attorney specializing in emergent technology, said, "That's the risk; we have a set of unknowns and we don't know how they're going to play out."

Britton believes that Linden Lab could face criminal charges under the 1970 Illegal Gambling Business Act or the Unlawful Internet Gambling Enforcement Act, which was passed in October 2006, and prohibits any financial transactions through online gambling sites.

Sean Kane, a lawyer at New York's Drakeford & Kane, said, " What they did was go after processors, and made it a crime to process payments that relate to online gambling sites. Linden could potentially be held as the same sort of processor.

"If you're buying money on the Lindex (a virtual currency exchange) and utilizing it for gambling purposes, Linden could have a much higher level of responsibility," he said.

"If they would be found in violation, that's difficult to say, but I can see a much stronger case being made," he added.

Yoon said that Linden Lab's rules prohibit illegal activity. "It's not always clear as to whether a 3-D simulation of a casino is the same thing as a casino, legally speaking, and it's not clear to the law enforcement authorities we have asked," Yoon added.