Wednesday, March 22, 2006

Dude, Online Poker is Going to Be So Illegal Soon (Not)

If you've been living under a rock or busy playing 182 tables simultaneously, Congress is once again rumbling about stamping out the horror and travesty that is online gambling. The latest attempt is a piece of legislation that would essentially make it illegal for online gambling operators to accept financial transactions in the form of credit cards, checks, wire transfers, and electronic funds transfers (EFTs) from US players.

One interesting thing to note is that the current bill up for debate specifically excludes certain types of gaming, most notably horse racing and fantasy sports. That's fine and dandy, and you can continue to pump money into those endeavors as much as you like. Just not poker or sports betting or online casinos.

Another interesting aspect of the bill to note is that it's not currently tilting at the windmill of whether or not it's illegal to place a wager over the Internet, or to play poker for real money. It's very strongly implied, and the ultimate intent is to prevent such horrible acts from occuring, but the bill itself only addresses the specific mechanism of funding online gaming accounts, not utilizing them.

In some ways, that's smart, as it avoids some logistical pitfalls. If you want to enact legislation that declares online gambling (except for horse racing and fantasy sports, of course) illegal, you're basically reduced to relying on ISPs for enforcement and regulation. That has had pretty mixed results in other areas, for the obvious reason that ISPs have absolutely no desire to be cracking down on their paying customers, aside from the fact that actual enforcement is impractical/impossible, depending on the savvy of the end user.

That said, you're still looking at a logistical nightmare, as far as potentially enforcing the proposed legislation. And there's really no detail at all, as far as who would ultimately be responsible for enforcement, which will likely doom the bill in the end.

Is the US banking system on the hook (and services such as Firepay and Neteller) to ensure that no checks or wire transfers or ETFs from US citizens go out to online gaming sites? Are foreign-based online gaming operators on the hook to ensure that no funds from US citizens flow in? What about funds from a US citizen, residing in the US, but one who controls a Panamanian banking account, where the funds originate from?

Pulling back a bit, what about existing funds in an account, prior to enacting the legislation? What about transfers between player accounts? Do you really think that online operators will cooperate, 100%, or do you think they'll do their best to skirt the legislation in order to keep their single largest demographic flinging chips and contributing rake?

In the end, it's hard to see this thing passing, due to so many details being lacking. And, honestly, I'm not sure if even its supporters expect it to pass, despite all their chest thumping. Part of the implied rationale in the proposed bill is something along the lines of "Hey, we probably can't really stop people from playing poker online, but we can at least make a good faith effort, and then wash our hands of it, claiming that we at least tried."

It's disappointing, aye, and pretty damn hypocritical, as far as giving wagering on horse racing the thumbs up (and completely ignoring the larger, much more pervasive evils of lotteries), but hey, what else do you expect from the US these days? We're inching closer and closer to an outright ban on abortions, have successfully de-stabilized the Middle East, and continue to plunge deeper and deeper into unprecedented levels of debt.

Why in the world would we do something logical like taxing and regulating online gaming, not only bringing in billions in revenues but also adding stability and security to an industry that millions and millions of US citizens take part in, and will continue to take part in, regardless of attempts to criminalize it? Just like drinking and smoking, except, umm, not as "legal".


Unknown said...

"THEY made me gamble!!"

Yep, just like a little pod person forced a person to go slam 24 Jag bombs before climbing back into their car and cause an accident.

America - The land of SELECTIVE freedom

Big Jim Slade said...

Your posting makes me want to go to and download a copy of the bill and see exactly what all this is about. Obviously I am opposed to the bill, but your article inspires me to gets the facts to enable me to articulate my discontent.