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Russian casinos ordered out of town

2007-06-06 10:52:40

Last Updated: Saturday, 27 January 2007, 11:40 GMT

By Richard Galpin

BBC News, Russia

Casino in Moscow

The Russian parliament has passed a law that will force all casinos to close

down over the next two years

A rapid growth in gambling has prompted Russia to ban all casinos and gaming

halls from its major towns and cities.

From Tolstoy to Dostoevsky, Russia's long love-affair with gambling is well

documented in the country's greatest works of literature.

So it should not come as a great surprise that it is once again boom-time for

the gambling industry here, after being banned for most of the last century by

the communists.

Some parts of Moscow now bear more resemblance to Las Vegas than the heart of a

nation which once provided the most powerful alternative to Western capitalism.

The entrance to the Jazz Town casino in the city centre is typical of many: a

full-frontal assault on the senses.

Huge, fizzing neon lights illuminate a top-range Mercedes as it spins round on

a small podium. The aim is to entice yet more people to throw caution to the

wind and put serious money down for the chance of winning a serious prize.

The casino is all you would expect: dark, quiet and crammed with card-tables,

roulette wheels and hi-tech fruit machines; and above - mirrored ceilings.

The gamblers are mostly older men still wearing their work suits but with ties

pulled low. And the air is thick with cigar smoke and tension.

Cutting a swathe through the heavy atmosphere, greeting staff and friends with

a regal kiss and smile, is the big boss.

Cut-throat world

He owns a string of casinos and fruit machine arcades which he says were

recently valued at more than ?500m ($984m).

It is a gambling empire which he has built from scratch over the past two

decades, right through the period of Russia's wildest post-communist days.

Quite how he has survived this cut-throat world is a mystery, especially as he

is not even Russian, he is British.

Pulling hard on a cigarette, Michael Boettcher tells me how he left London in

the late 1980s, having lost all his money in the property crash. Now he is the

proud employer of 6,000 people.

Many moons ago, he says, when he first starting working in a casino in the

west, he earned ?12,000 ($23,600) a year. Now, he whispers, he makes that every

couple of hours.

He estimates the Russian gambling industry as a whole pulls in as much as ?4bn

($7.8bn) a year.

As we wander through the casino together, he takes time out from much kissing

and greeting to emphasise the apparent altruism behind his enterprise.

Redistribution of wealth

Casino in Las Vegas

Those who want to gamble will have to invest a lot of time, effort and money to

reach one of the new Las Vegas-style gambling zones

In the modern ultra-capitalist Russia, he has seen oligarchs blow a million in

his casinos over a couple of days. He says it is a chance for him to

redistribute the nation's wealth which is currently concentrated in so few

hands.

He claims the oligarchs' bad luck means bigger bonuses for his staff. I am

touched.

But now another reality of present-day Russia is about to bite back.

The benevolent Mr Boettcher looks set to become a victim of the ever-lurking

uncertainty that makes doing business in Russia so risky. Spurred on by the

Kremlin, the Russian parliament has passed a law which will force all casinos

and fruit-machine arcades to close down over the next two years.

Instead gambling is to be confined within four special zones in different parts

of the country, all outside the cities. The government is very deliberately

aiming to separate the population from the casinos.

Those who want to gamble will have to invest a lot of time, effort and money to

reach one of the new Las Vegas-style gambling zones.

Mr Boettcher is able of course to apply for a new licence to operate in those

zones. But he thinks it may be better to just pack up, leave Russia and find

somewhere more welcoming to start all over again.

He has now got his eye on India.

Growing addiction problem

The Russian government says there are very good reasons for imposing such tough

new regulations. It seems the exponential growth in casinos and arcades has

been matched by a similar growth in the number of gambling addicts across

Russia.

Reliable figures are difficult to come by and do vary significantly. But one

man who has seen the problem at first hand is Father Anatoly Berestov, an

Orthodox priest who runs an addiction clinic in a 16th-Century church hall in

Moscow.

He uses a mixture of cajoling and therapy to help those who can no longer

control their urge to drink alcohol, take drugs or gamble. He is convinced the

number of gambling addicts has shot up in recent years.

Many are businessmen with families who lose everything.

"I've seen many suicides," he told me.

But he is also particularly worried about the spread of this addiction into the

villages where, he says, the elderly are now throwing away their pensions.