new federal law that targets online gambling hasn’t deterred Wheatfield resident Matt Wilkinson from playing Internet poker.
The legislation has been little more than an inconvenience for Porter resident and poker devotee Larry Austin, and it hasn’t impressed the head of the area’s largest gambling treatment program.
The Unlawful Internet Gambling Enforcement Act, tacked on to a port security bill and quietly signed into law by President Bush in October, makes it a crime to use credit cards or online payments to gamble. The federal Treasury Department and the Federal Reserve System have until July to set up regulations to enforce the law.
But the legislation is facing criticism from a rare pair: online poker players and people who help addicted gamblers.
As government moves to quell Internet gambling, its first few steps have drawn criticism from the far corners of the industry. Poker players are agitated that gambling sites are shutting out U.S. customers. Gambling treatment administrators worry that online gambling will be pushed further off-shore and out of their reach, and a Virginia lawmaker who spearheaded an initiative last year to ban online gambling believes the new law isn’t strong enough.
“What you’ll find is that rogue sites are going to pop up that have no interest in safe guarding the product,” said Michael Bolcerek, president of the Poker Players Alliance, a lobbying group formed in opposition to a federal bill proposed in 2005. “It has unintended consequences; that’s what you’ll see going forward with prohibition. Just like you saw the unintended consequences of alcohol prohibition — the speakeasies.”
The new law comes as the Internet is expanding the reach of sports betting and poker to living rooms across the country. It has never been easier for gamblers to access credit, play a round of Texas Hold ’em or place an online wager on a basketball game, and the government is starting to take notice.
In November, Queens District Attorney Richard A. Brown announced investigators had used existing criminal laws to take down a $3.3 billion online sports betting ring —the largest gambling bust in its history.
Until the bill passed in October, online gambling had gone virtually unregulated, operating in a shadowy area of the law. But the new legislation has done little to appease advocates of treating problem gambling.
Keith Whyte, executive director of the Washington-based National Council on Problem Gambling, believes the law will do little to slow the growth of online gambling.
“Will it impact gambling? Yes, but not much,” Whyte said. “I think it will make it a little bit less convenient for casual gamblers, but heavy gamblers and certainly problem gamblers will take the extra step and can easily find ways around this law.”
Whyte’s organization does not oppose or endorse gambling, but instead fights for more resources to be put toward the treatment and prevention of problem and pathological gambling.
The weakness of the law, Whyte and others believe, is that it doesn’t ban online gambling. It instead bars electronic payments to unlawful gambling sites and holds financial institutions responsible for blocking restricted transactions. The law excludes online horse betting and fantasy sports sites.
“How is your bank going to prove that four steps down the line your funds came from Internet gambling, especially if it’s companies that are not under U.S. jurisdiction?” Whyte asked. “It adds a couple of steps. It will inconvenience casual gamblers, but it’s not likely to stop problem gamblers.”
Rep. Bob Goodlatte, R-Va., a key sponsor to a previous online gambling bill passed by the U.S. House of Representatives, called the new legislation a “step in the right direction in the fight against online gambling,” but said shortly after it was passed that he was preparing a stronger bill to combat Internet gambling.
Portions of Goodlatte’s original proposal passed by the House were stripped from the final version of the Unlawful Internet Gambling Enforcement Act when it was passed by Congress as an addition to the Security and Accountability for Every Port Act of 2006.
Online poker players say it is relatively easy to find third-party sites that will handle online payments, making it difficult for banks or regulators to prove money is connected to gambling.
Matt Wilkinson, a Wheatfield sales manager who has been playing online poker on and off for five years, says the new law has frustrated players, but has done little to stop the game. When one site shuts down, Wilkinson said, players find another company.
Wilkinson believes lawmakers went after online gambling because companies that run the sites operate outside of their jurisdiction.
“Most of them are based in Costa Rica, Antigua, Barbados —places that don’t have a lot of laws in place to report their revenues,” Wilkinson said. “I don’t think the motivation behind passing the act has anything to do with problem gambling or trying to quell their habits.”
Like Wilkinson, 41-year-old poker player Larry Austin said the closure of some Web sites to U.S. customers has been merely an inconvenience.
“It criminalizes a game. To me, poker is like baseball, it’s a great American pastime. Who hasn’t really played poker at the kitchen table?” asked Austin, a writer who lives in Porter.
Austin objects to the way the federal law was passed. “They included it in a port security bill and they passed it in the middle of the night,” he said.
Renee Wert, a psychologist who runs a gambling recovery program for Jewish Family Services of Buffalo and Erie County, said poker can be just as devastating as other forms of gambling. Wert’s program, which until last year was the only provider of gambling treatment services in Western New York, has seen a rise in the number of people seeking help because of online gambling.
Wert says online gambling has a dangerous mix of easy access to gambling, instant credit and few barriers to underage players.
“The faster the rate of play, the more addictive potential something has,” said Wert, who is also vice president of the New York State Council on Problem Gambling. “Anything that’s going to make it easy for you to gamble quickly, there’s more of a tendency to develop a problem.”
The ease of online gambling —anyone with a credit card and a computer can access sites — has expanded gambling’s realm and raised the stakes for criminal investigators.
The November online gambling bust was the largest sports betting ring ever taken down.
The sophisticated online betting ring, Queens District Attorney Richard A. Brown said, booked more than $3.3 billion in wagers in little more than two years. The indictment included 27 people, including boss James W. Giordano of Pine Crest, Fla., and three corporations that included the firm that designed the operation’s Web site.
Investigators say the scope of the operation dwarfed traditional betting rings because the Internet allowed it to extended its reach.
Brown believes the indictment sends a strong message to Internet gambling operators.
“For the first time ever, an Internet provider and a Web designer were charged with directly participating in a billion-dollar-a-year global gambling operation,” Brown said. “This landmark prosecution has potentially far-ranging implications not just for Internet gambling sites, but for those who assist them in building their criminal enterprises.”
Source: Lockport Union Sun & Journal