The Commodity Futures Trading Commission has effectively shut down Intrade, the online
gambling house futures trading exchange, for US investors:
Facing accusations that it allowed American investors to bet on the outcome of wars and other world events without the blessing of regulators, Intrade announced on Monday that it was closing its Web site to United States residents.
The disclosure, which referred to “legal and regulatory pressures,” was released hours after American authorities sued the company, which is based in Dublin, over its popular trading network. Investors log on to Intrade by the thousands to bet on the outcomes of elections, the weather and even whether the United States will bomb Iran.
But in a civil complaint filed in federal court in Washington, the Commodity Futures Trading Commission took aim at the company and an affiliate for offering the contracts outside traditional exchanges and without regulatory approval. The agency also accused the companies of “making false statements” to regulators and violating a past order barring it from offering so-called prediction contracts outside traditional exchanges.
“Unfortunately this means that all U.S. residents must begin the process of closing down their Intrade accounts,” the company said on its Web site. “We understand this announcement may come as a surprise and a disappointment, and we apologize for the short notice and haste required to deal with this.”
I’m pleased, but I am stunned.
It’s a refutation of the philosophy of the “free-market mousketeers” who are inclined to allow all kinds of crazy sh%$ to pretend to be high finance, as opposed to a particularly abusive casino, in which the house takes even more than Vegas.
BTW, Intrade’s record sucked too, witness the gyrations in the 2008 Democratic and 2012 Republican primary markets.