Online Gambling: A Lost Cause? (3 of 8)

Online gambling sites have existed for many years. For a long time, players in the United States were virtually untouchable, no pun intended. Besides the absence of laws explicitly outlawing online gambling prior to the UIGEA, prosecution of gamblers was really never seen. When the Department of Justice(DoJ) launched their attack against the online gambling community it caught everyone by surprise. The first attack consisted of the seizure of many domain names, including some from outside the U.S. (an issue I will discuss in a later blog). What I found interesting was the diversity of players that were affected- players consisted of full time attorneys, politicians, average Joes, etc.  After the all-out blitz the DoJ launched, Former US Senator Alfonse D’Amato said “On behalf of the millions of poker players across the country, we are shocked at the action taken by the U.S. Department of Justice today against online poker companies and will continue to fight for Americans’ right to participate in the game they enjoy. Online poker is not a crime and should not be treated as such. We are currently gathering all of the information around today’s announcement and will offer detailed analysis when the full facts become available.”[1]

Black Friday to many is a day to get amazing sales before thanksgiving. For the gambling community, it refers to April 15, 2011 which arguably was the death of online gambling as we know it. Indictments against the owners of FullTilt Poker, PokerStars, and Absoluter Poker had a huge effect on their players. Immediately, assets were frozen and players’ were unable to take their money out from these sites. One of the big issues related to these sites was an allegation related to these poker sites persuading small banks. The DoJ alleged small banks facing difficulties surviving were persuaded to process gambling transactions in exchange for large fees and investments in the bank.[2]

Just like the Electronic Frontier Foundation exists to protect us from attacks in the electronic world, there are organizations tailored towards online gaming. The Pokers Player Alliance is comprised of online poker players who try to promote and protect the game.[3] A good bit of effort has been dedicated to fighting legislation such as the UIGEA.[4] Similarly, the Interactive Media Entertainment and Gaming Association is actively involved in the promotion of the industry. When Kentucky initially allowed the seizure of many domain names, iMEGA submitted a brief which ultimately aided the successful overturning of these domain seizures.[5]

The DoJ, in the words of Birdman, seemed to be “poppin’ champagne like [they]won a championship game, look like [they] got on a championship ring.” Online gambling has a huge potential to produce revenue states may enjoy. Congressmen such as Barney Frank(D-Mass) and Joe Barton(R-Texas) have argued virtual betting could boost tax revenue and create new jobs.[6] What do you think the primary reason for launching this attack was? In our class discussion with Mr. Fakhoury, I asked whether a uniform code of some sort would help resolve the inequities seen across the states in regards to online crimes. The discussion then lead to the idea that the internet is meant to be what WE want it to be and what we want to make out of it. A uniform code may cause more problems. How should this idea or theory apply to online gambling? Is it feasible? Even though the online gambling community was/is massive, the DoJ put all these companies in a bind where they basically have to get out while they can.

Enjoy the video below which is a fair representation of the DOJ’s attack against the online gambling community.

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~ by davidghassan on November 5, 2011.

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