California State Legislators Briefed About Online Gambling

by Devon Chappell, News Staff Writer

June 16, 2008

California State legislators were all ears last Friday when former New Jersey Assistant Attorney General and Director of Gaming Enforcement, Frank Catania and other internet betting industry experts gave an in-depth and poignant briefing citing why online gambling should be regulated rather than attempting to enforce a carved out prohibition.

Catania aptly spoke of many reasons why it's unwise to attempt a prohibition, the most obvious of which is that online gambling simply cannot be stopped. U.S. citizens are going to gamble at online casinos whether someone likes it or not, which briefing moderator, former Florida State Senator Steven Geller put into so many words. This a reality even if that someone is the "father" of the Unlawful Internet Enforcement Act (UIGEA) - Senator John Kyl.

The passing of the UIGEA certainly hasn't put a hamper on internet betting activity. In fact, the U.S. facing online gambling industry, including poker, casino and sports betting, continues to grow each month. Catania estimates it is now worth $15 billion in the U.S. alone. And the sad thing is that instead of collecting badly needed federal tax revenue, the government will be forced to dish out more money to compensate WTO member country's, such as Antigua and Barbuda, for lost online gambling revenue due to the hypocritical lottery, horseracing and fantasy sports betting carve outs in the UIGEA.

In fact, the five-year old dispute has already spawned a WTO ruling in favor of Antigua, leading to a U.S. withdrawal of its General Agreement on Trade and Services, which they will surely be heftily fined for if they UIGEA stays in tact, even for the time being.

Not necessarily promulgating online gambling regulation, but nonetheless providing a strong voice of opposition against the UIGEA has been the American Bankers Association. Senior company counsel for Wells Fargo, Ted Teruo Kitada, drew attention to the fact that the UIGEA charges banks and the general U.S. banking system to identify and police online gambling transactions - a task which is practically impossible, especially considering the fact that the UIGEA does not identify which online gambling transactions are illegal and which are tolerated (thanks to the carve outs and general vagueness of the legislation). As Kitada put it, Wells Fargo handles millions of transactions every day and is not prepared for such a burdensome task.

Even if there are good intentions behind the bill (yea right!...since when did carve outs represent a moral stance on gambling), implementing an online gambling prohibition is just not possible. And in California, where Poker Players Alliance Director, John Pappas, said there are over 100,000 online poker players, regulating online gambling on a State level, is the soundest solution. Just like in land based casino gambling, proper regulation (as is now being done in the UK) will keep crime out and underage/problem gambling monitored and curbed.

Back to CASINO NEWS