Cyber World Group, owners of some of the world's largest online casinos including Golden Palace Online Casino, have pleaded guilty to charges of illegal gambling in a landmark case which challenges the rights of the Mohawks to award gaming licenses.

CBC in Canada yesterday confirmed earlier speculation that the Quebec government has launched an attack on internet gambling activity in Kahnawake, enclave of the First Nation Mohawks. Hundreds of online casinos and poker rooms are licensed by the Kahnawake Gaming Commission (KGC), which has so far enjoyed the right to award gaming licenses and regulate their licensees.

The Mohawks claim the Canadian Constitution, which protects traditional native rights, gives them the right to provide hosting for any online gaming company they choose to license and regulate. The KGC has already licensed almost 450 online gaming companies and is widely considered in the industry to be a fairly strict regulatory body. Tribal leaders claim that 60% of the world's online gambling traffic runs through its servers.

The Quebec provincial government has apparently decided the gravy train is over for the First Nation Mohawks, fining Cyber World Group $2 million for having their servers based there. Cyber World has pleaded guilty, setting a worrying precedent for KGC-licensed online gaming operators.

Joe Delaronde, a member of the Kahnawake band council, told CBC the fines are the result of a wider jurisdictional battle between the Mohawks and the provincial and federal governments:
"We don't ask for anything. We tell them that this is our right to do this. And we're doing it properly, we're administering it properly — the world seems to think that we're doing a good job, and we're confident we'll continue to do a good job."

The legitimacy of KGC licenses will likely be settled in court. But some gaming officials in Alderney and Malta may be popping bottles of Dom Perignon this week.