Friday Hearing on Internet Poker: Can We Still Control Offshore Gambling Sites?

A November 18, 2011 Subcommittee on Commerce, Manufacturing and Trade hearing discussed the potential pitfalls of legalizing Internet poker in the United States.  Issues raised included under age and problematic gambling along with cheating mechanisms.   Additional coverage of Friday’s hearing, which concluded at 11:09 am EST could be found on the Gambling911.com website. 

But what about the current multi-billion dollar online gambling industry that exists and what’s to stop these operators from continuing to extract business from licensed businesses in the States. 

Congressman Gregg Harper (R – MS) questioned:  “(Shouldn’t we) block all payments before expanding it (the online poker industry) here?  What’s to keep players from still going offshore?”

“The market will take care of this,” said American Gaming Association’s President Frank Fahrenkopf.  “The consumer will want to play with brands that they know.  Second, we would want to strengthen UIGEA (the Unlawful Internet Gaming Enforcement Act).”

“Shouldn’t we do that first?”

Fahrenkopf insisted this could be done at the same time. 

But how?

When the Unlawful Internet Gaming Enforcement Act was passed in October 2006, this was considered an unfunded mandate whereby banks were placed in charge of policing the activity.  They elected to designate all online gambling transactions as “prohibited” and this included state lottery and horse racing wagers, deemed legal under UIGEA. 

Fahrenkopf’s point about the market correcting itself provides a more real assessment of what might occur should Internet poker be regulated in the US. 

Gambling911.com has spoken to existing offshore operators who tend to agree that well known US-based casino brands jumping into the market provide the most serious threat. 

Should Fahrenkopf’s initial point about the big casino brands ultimately dominating the online market be correct, there are certainly doubts as to whether the AGA would even bother trying to enforce UIGEA.

Present draft legislation could prohibit credit cards from being used in making deposits and withdrawals as it currently is in the state of Nevada and this would likely solve the issue related to strengthening UIGEA.    

Electronic checks, bank wires and quite possibly various forms of debit and gift cards could become the norm in such a scenario. 

- Chris Costigan, Gambling911.com Publisher