Online betting site Intrade abruptly closes
The site allowed users to bet on just about anything, but saw its traffic take a steep plunge after US regulators stepped in.
The site, based in Ireland, suddenly stopped all trading activity this week, and posted a notice for customers that suggested "financial irregularities" were to blame. The site closed all open contracts their fair market value on Sunday.
Some of the problems may relate to $2.6 million in insufficiently documented payments to its founder, The Financial Times reports. The founder, John Delaney, died while attempting to climb Mount Everest in 2011.
Intrade was already running into legal trouble. Last year, the site shut its doors to users in the United States after receiving a civil complaint from the Commodity Futures Trading Commission. Regulators said that U.S. Intrade users were betting real money on options contracts that predicted which way gold, oil and other commodities would turn. It's illegal for people to trade commodity options unless they are listed on a real exchange registered with the commission.
Pulling U.S. users away from Intrade was disastrous for the site. Traffic fell 77% from 287,000 visitors in November to 67,000 one month later, The Times reports. That raised questions about Intrade's effectiveness as a prediction site.
Intrade became a hot topic last year, as presidential election watchers checked in to see how people were betting. The site was accurate in picking Barack Obama as the winner. But customers could place bets on just about anything.
- Five Guys franchisee attacks Obamacare
WHAT IS SCARY ABOUT ON-LINE GAMBING IS THE USA CLOSING DOWN THE SITE AND STEALING OUR MONEY.
Copyright © 2014 Microsoft. All rights reserved.
Only one of these troubled companies is worth owning, says Jim Cramer.
VIDEO ON MSN MONEY
Top Stocks provides analysis about the most noteworthy stocks in the market each day, combining some of the best content from around the MSN Money site and the rest of the Web.
Contributors include professional investors and journalists affiliated with MSN Money.
Follow us on Twitter @topstocksmsn.