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Legalizing Internet Gambling on a Federal Level in the States; Now or Never

24 November 2010 by Devon Chappell

ussenateWith the brick ‘n mortar gambling industry’s largest B2B gathering – the Global Gaming Expo – coming to a close, it’s kind of ironic that the topic most attendees were and are continuing to talk about is online gambling. But then again, I suppose it’s to be expected. For years, one of the main roadblocks of getting online gambling legalized in the United States has been resistance from the brick ‘n mortar gambling industry. Whether from Las Vegas casinos, racing tracks in New York or whatever is left of Atlantic City, land-based interests – naturally – feel threatened by the prospects of losing business to the virtual world.

The only catch is that this “lost” business was never there to begin with. Offshore online casino operators have long been doing business with U.S. citizens – billions of dollars worth of business, in fact. And some still continue to do so even with the so-called US online gambling ban (UIGEA) passed into law in 2006 and enforced this year. Now that it’s evident there is no stopping U.S. citizens from exercising their free rights and gambling online, land-based interests – naturally – are now jumping on the bandwagon to get online gambling regulated and legalized. Well, kind of. Harrah’s Entertainment is certainly on board for federal regulation. It’s still unclear with other gaming interests.

And that’s where we’re at today. While there has never been a better time to overturn the UIGEA (or at least give individual State’s the right to regulate online poker), whether or not the current Congress is going to do so remains to be seen. In actuality, I suppose it would be more fitting to say whether or not Senate Majority leader, Harry Reid (Nevada) does so. I know what your thinking – How is it possible that one man can make online gambling legal in the US? Well, he can’t. But Reid certainly is the central figure who can give online gambling it’s greatest chance of being legalized in America to date.

As the Senate Majority Leader, Reid has the power to attach gambling legislation to an unrelated, must-pass bill, which is exactly what Bill Frist did with the UIGEA as an attachment to the must-pass Port Security bill in 2005. Although Reid – being from Nevada – is sympathetic with brick ‘n mortar casino operators, the challenge – as stated by Poker Players Alliance Executive Director, John Pappas – is finding a consensus with Nevada gaming interests and other stake holders on a bill that everyone can support.

Pappas went on to say that Reid certainly isn’t giving anything away. In other words, Reid could stand to do well playing online poker, ’cause his game-face isn’t revealing the slightest bit. What we do know about Senator Reid is that he has flip-flopped his views on regulation a number of times. The good news is that his last flopping was on the side of legalization. That said, if online gambling is going to be legalized on a federal level, it’s going to take place after Thanksgiving and before Christmas. If not then, well…let’s just say it will be another two years (when Congressional elections take place) before the issue comes up again on a federal level.

The hope is that with some major tax bills coming up for a vote before Congress (some would say must-pass bills), Congressman Barney Frank’s bill (HR 2267) to regulate online gambling could serve as a fitting attachment. There is no denying that regulation would generate billions in tax revenue. Depending on how these tax bills work out, legalization could be the key to helping find balance for a looming budget and struggling economy.

Granted, if Frank’s bill does not make it through, legalization could still come on a Statewide level. In fact, it most likely will. New Jersey is well on its way to do so – the New Jersey Senate overwhelmingly approved a bill that would allow New Jersey residents and people outside of the US to gamble at Atlantic City online casinos. The only problem is that this could make things very complicated, very fast. Harrah’s Entertainment, which operates a casino in Atlantic City, is highly in favor of federal regulation. And so is everybody else in the industry! Obtaining a new gaming license on a state-by-state basis would be nothing short of mind-boggling for an online casino operator, no matter if it’s Harrah’s or the “little” guy the likes of Go Casino.

Keep your fingers crossed my friends. Better yet, send an email to Senator Harry Ried.

4 Responses to “Legalizing Internet Gambling on a Federal Level in the States; Now or Never”

  1. […] But the G2E isn’t just for professionals in the brick ‘n mortar casino industry either. As we all know, the online and offline gaming worlds are merging. Harrah’s itself is has an interactive department and has already launched two Euro online casinos, WSOP Casino, not to mention WSOP Poker. And let’s not forget about Caesars Online Casino catering to the UK crowd. In fact, the hot topic at this last G2E was all about online gambling regulation and how Senate Majority Leader, Harry Reid, holds the cards for getting gaming regulated in the States. […]

  2. Anonymous says:

    I am very hopeful that online gambling would still be legalized in the U.S. And I am looking forward that Senators would defend this issue during the global gaming expo.

  3. […] that I want UIGEA to be firm or for a U.S. ban to be placed on U.S. citizens rather than on financial institutions, […]