Feds Probe Esquire for Gambling Ads

Esquire magazine ran five pages of ads for online gambling casino Bodog.com in the April issue, and there was more of the same on the boards, but now the New York Post reports that Hearst executives may be pulling the gambling ads – under increasing pressure from the feds.

Earlier this month, FBI agents ratcheted up a probe of illegal gambling ads by serving about a half-dozen Esquire staffers with subpoenas.

The U.S. can’t control the gambling operations offshore but claims the capability to regulate the ads, arguing that solicitation of gambling from overseas via advertising in domestic media is unlawful under the Interstate Telephone Act of 1964.

A source reportedly told the Post: "They [Hearst] are either going to run public service announcements or more edit. Either way it’s going to cost the book money. They basically lost about a million in revenue that was scheduled to run in the next three issues.”

The April ads in question feature Calvin Ayre, the CEO of Bodog.com, saying, "I invite you to join me online at the tables and see why the world is playing poker at Bodog.com.”

The Esquire problems are part of a larger picture. Last year, Maxim, Outside, Men’s Journal and others dropped gambling ads after receiving official warning letters from the Justice Department that the ads were seen as unlawful and would be the subject of prosecution if continued.

Meanwhile, the latest development does not auger well for Esquire, which has seen a downturn in advertising in its pages. In the first quarter of 2005, its ad pages dropped 12.2 percent to 187.35 ad pages - down from 213.5 a year ago.

Editor's note: