THE Australian Federal Police and the FBI are jointly investigating untaxed and unregulated online casino sites, which take an estimated $1 billion a year from about 700,000 Australian punters.

Australians have long used sites such as PokerStars and Full Tilt Poker even though the Interactive Gambling Act prohibits the provision of ''an interactive gambling service to customers in Australia''.

Chips down ... it is illegal for a company to offer interactive casino games such as poker to customers in Australia.

Companies that breach the act, which applies only to casino games, are meant to face fines of $1.1 million a day. But the sites being investigated use Australian bank accounts to collect money from gamblers and PokerStars has a Sydney office - staffed by 200 people - through a subsidiary, GP Information Services.

PokerStars and Full Tilt Poker are forbidden from advertising in Australia but get around this by sponsoring the Cronulla Sharks and the Sydney Roosters rugby league teams, by employing celebrity spruikers such as the cricketer Shane Warne and by sponsoring free pub poker leagues.