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The US vs Online Gambling II

By: Kenneth Bateman

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Online gaming won a small victory in 1999, when the Internet Gambling Prohibition Act failed to achieve the two-thirds majority vote necessary for passage in the House of Representatives as required by law. Cause for celebration by the multi-billion dollar online gaming industry, however, was short-lived.

As it is now being enforced in 2006 by an anti-internet gambling United States Government, the law as it has been amended in the Federal Criminal Code makes it unlawful for any person engaged in a gambling business to use the Internet or any other interactive computer service to:

- Place, receive or otherwise make a bet or wager.
- Send, receive, or invite information assisting in the placing of a bet or wager.
- Penalties include fines and up to five years imprisonment.

Some legal minds, particularly, but not necessarily, those persons aligned with Internet gambling interests, suggest there is no actual constitutional authority for these actions, and the enforcement of this legislation amounts to an abuse of constitutional authority. The key to this argument is in the 10th Amendment, which specifies that all powers not enumerated in the Constitution belong to the people and the States.

Certainly, legal brick and mortar gambling establishments in the United States will view this Federal assault on internet gambling as an elimination of competitors. As far as Federal, State and local governments are concerned, they receive no benefit from online gambling, since these offshore establishments do not create tax revenue.

The State of Nevada is coping with the meteoric growth of online poker by forcing all prospective gaming license applicants to sell any ownership stakes in online casinos, and prohibiting licensed poker rooms from conducting satellite tournaments that award winners with prepaid buy-ins to Nevada poker events.

However, despite conventional on-land casino’s silence on this issue, the WSOP championship event host, the Las Vegas Rio, did allow several online poker sites to promote themselves in the Rio’s luxurious hospitality rooms. Doyle’s room, UltimateBet and Bodog were some of the internet gambling entities that were conspicuously present at the 2006 WSOP.

Harrah’s Hotel and Entertainment Enterprises, owner of the Rio, rationalizes that these online gaming operators are not in violation of U.S. gambling regulations since they are advertising themselves under their online .net suffix where poker can be played free with no money exchanged, as opposed to their .com suffix, where poker is played for real money. This arrangement allows Harrah’s to consider themselves “within the law” because they are not allowing the promotion of online gambling, just internet games played for “fun”.

Of course, it is obvious that once online players begin playing for free and increasing their skills and confidence, it is almost a foregone conclusion that they will try their luck at real money play. As further proof of the wink and nod relationship between the Rio’s WSOP relationship to online poker sites, Nolan Dalla, the WSOP series media director, is a high-profile spokesman for the internet gambling site, and the felt tops of the WSOP poker tables feature the logos of Partypoker.

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Kenneth Bateman writes numerous articles on the subject of online casinos. To read more of his articles visit

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