LOOKS LIKE A SURE THING, BUT

Take a look at the financials for online gambling giant PartyGaming Ltd., and you'll see why many think its initial public offering will be a monster. Last year, the Gibraltar company earned $350 million in profits on $602 million in revenues by taking a small commission from online poker, bingo, and other games. But scratch the surface, and the company faces big risks, like an amateur playing Texas Hold'Em. The 200-page prospectus cites unusual legal threats. Chief among them is a warning that 87% of the revenues come from U.S. customers, yet Uncle Sam sees Net gambling as illegal. The document warns that the Justice Dept. considers "companies offering online gaming to U.S. residents are in violation of federal laws" and that actions taken by U. S. officials could "result in investors losing all or a very substantial part of their investment."