Internet Gambling on the way out

October 2, 2006 10:51 AM

H.R. 4411: The Internet Gambling Prohibition and Enforcement Actis a bill aimed at making online gambling illegal by blocking any US funds to foreign servers from American banks and credit cards. It passed the House on Saturday and sent British gambling stocks tumbling. I was kind of surprised at the swift passing of this bill, given that online poker is a pretty serious business, but one poker site says they'll be in the clear as poker is a game of skill and not just chance (good luck with that). Oh, and this is just one cog in the 10 tooth wheel of The American Values Agenda, the republican attempt to push socially conservative issues in time for the election.
posted by mathowie (42 comments total)

Given the "religious" right's recent coziness with American gambling interests (e.g., Ralph Reed), I'd bet the farm that this has a lot more to do with trying to keep American gambling money at home.
posted by felix betachat at 10:56 AM on October 2, 2006

In California, poker is legal where gambling in general isn't, so they MIGHT have a point.

On preview, I think felix has a pretty good point.
posted by doctor_negative at 10:57 AM on October 2, 2006

Yeah, it certainly leaves the door wide open to American bank and credit cards moving money to American gambling sites.

That's one thing I found opportunistic -- they cloak this all as a way to prevent online gambling but it's really just offshore gambling when you get right down to it.
posted by mathowie at 10:59 AM on October 2, 2006

...poker is a game of skill and not just chance...

Which is why they ban card counters? They are too skillful?
posted by prostyle at 11:00 AM on October 2, 2006

So let me understand, the backers are compulsive gamblers and they want a law to keep them from doing something they know is bad for them?

Oh, wait, they don't gamble, but their beliefs tell them to keep other people, who don't share those beliefs, from gambling. (Except in Atlantic City, Los Vegas, and in the State Lottery.)
posted by orthogonality at 11:02 AM on October 2, 2006

The amended 1961 Wire Act modernizes its language by including the Internet and prohibiting games “predominantly subject to chance.”

It'll be interesting to see how they will classify poker. Is it predominantly subject to chance? It may well be -- after all, if you start with a pair of aces in the hole, you're a favorite off the bat, and that's all based on chance. But then again, would a good player be able to bluff you out of that hand? Maybe not on AA, but how about AKs? A favorite over the great majority of hands, but a skilled player can make it worth next to nothing. But then doesn't it depend on the flop, and isn't that again chance? But what about the skill the players use in interpreting those cards, how they help their opponents, what opportunities they offer, etc.

I'm looking forward to how this all turns out.
posted by splice at 11:04 AM on October 2, 2006

Prostyle: Which is why they ban card counters? They are too skillful?

I think you're thinking of Blackjack. Card counting isn't applicable in Poker.
posted by justkevin at 11:08 AM on October 2, 2006

I was just about to make an FPP on the subject so I'm glad to see it already posted. What a bunch of shit this is.

I thought Republicans were supposed to be about free markets? We sell a lot of shit to other citizens of other countries that may be illegal in their homelands. It's legal because when you do business online, the transaction is occuring on the seller's soil.

So if I find a Dutch website selling marijuana, I can order it and it's perfectly legal for both me and especially the Dutch seller, because Dutch laws apply. Now, when I import the drugs through the mail, I'll get busted just like I was carrying it through customs at the airport. But that's on me, not the Dutch guy.
posted by b_thinky at 11:09 AM on October 2, 2006

Prostyle, I think you are thinking about Blackjack, not poker. Poker reshuffles after every hand, so card counting is not all that useful.
posted by absalom at 11:09 AM on October 2, 2006

I was reading a poker blog this morning that reported that several of the larger online poker businesses are going to be closing all US accounts and sending out cheques for their account balances immediately upon the bill being signed by the President.

I also have seen a couple of poker bloggers advising US players who have accounts on the smaller sites to withdraw their balance immediately, or preferably two weeks ago, because the sudden outflow of cash from players who can no longer play legally could well bust those sites; not all poker sites run like PokerStars, for example, where player account balances are not part of cash flow.

Poker is mostly a game of skill among god players. It is mostly a game of luck among bad players. And 99% of the players out there are bad players. So, any poker outfit that continues to allow American players to keep playing after today shoud look at the case of the boys from Bodog and ask themselves if they really want to push their luck, especially against a legal system that, these days, one absolutely cannot win against.

The US government is holding Eek and Ike and the board is reading two aces and three non-paint rags. If they online poker companies go all-in, they'll be taken to the cleaners.
posted by solid-one-love at 11:10 AM on October 2, 2006

On preview, justkevin beat me to it.
posted by absalom at 11:11 AM on October 2, 2006

...poker is a game of skill and not just chance...

Which is why they ban card counters? They are too skillful?

Well, card counters are only banned from real casinos because a casino is considered private property and the casino reserves the right to "uninvite" anyone they choose. Card counters don't get banned online, for obvious reasons.

Also, card counting only works in Blackjack and from what I understand online Blackjack is nowhere near as popular as poker.
posted by Vindaloo at 11:13 AM on October 2, 2006

Shut down all games of chance, lotteries and bingo included, or make them all equally legal.
posted by pracowity at 11:14 AM on October 2, 2006

We are nearing the end of the 109th Congress. Congress is out of session until November to work on getting re-elected. A companion or related bill hasn't even been introduced to the Senate yet. It seems a little alarmist to abandon internet poker now.
posted by bperk at 11:14 AM on October 2, 2006

Ah, sorry for the derail. I am pretty ignorant when it comes to gambling.
posted by prostyle at 11:14 AM on October 2, 2006

I don't get this one. The only people I know who do any serious online gambling (poker or otherwise) seem to all be driving around with big "W" bumperstickers.
posted by Thorzdad at 11:14 AM on October 2, 2006

Just to throw this out there, do you think this has any RIAA influence, too? Certainly the "transfer of US funds to foreign banks" has implications for say, AllOfMP3, which relies on mostly foreign banks to accept balance deposits.
posted by symphonik at 11:16 AM on October 2, 2006

It's kind of ammusing how states are adding more and more tables and machines each year, yet we can't trust people to gamble on the computer. They need adult supervision. I think people need to be watched while drinking alcohol too. People shouldn't be allowed to keep booze in their own refridgerators - it'd be highly dangerous. They could just drink when they'd want to.
posted by b_thinky at 11:17 AM on October 2, 2006

Oh, yeah. I, as a Canadian, can legally play, but I will be cashing out. Consider: I play in the evenings after work. So my only competition is going to be from Europeans who are playing during the workday or after midnight -- and if they're playing at those times of the day, they are very serious players indeed. The number of fish who will be available to give me money is going to drop dramatically. It's just not going to be as profitable as it was.

The size of the fields in open multi-table tournaments will drop through the floor, leading to smaller prizes. The number of freerolls will drop. And so on.

Online poker may be worth playing again once the number of sites is whittled down by attrition to two or three, rather than the hundred or so there are today. But only if you're very, very good or European.
posted by solid-one-love at 11:18 AM on October 2, 2006

Don't many sites use PayPal like services - whereby your bank or credit card is being used by a third party, which in turn then pays the casino? Seems like an obvious loophole here: use a non-gambling related third party outside of the US to route funds.
posted by mdelaney at 11:29 AM on October 2, 2006

From the last link:
Congressional Republicans gave up, quite literally, on passing a substantive policy agenda several weeks ago, choosing instead to focus on divisive bills, which they didn't expect to pass, in the hopes of rallying the base in advance of the midterm elections.

Is my interpretation correct that when congressional Republicans put forth bills that they don't expect to pass, they are trying to express to potential voters, "Look at what we could pass if you get out and vote and tell your friends to vote"? Secondly, is there anything wrong with this tactic? It seems sort of legit. If my preferred party were in power and they did such a thing, I wouldn't hold it against them.
posted by Aghast. at 11:29 AM on October 2, 2006

mdelany : Don't many sites use PayPal like services - whereby your bank or credit card is being used by a third party, which in turn then pays the casino?

Yes, Neteller being the most popular. I was wondering the same thing. Neteller not being a gambling site, and outside US jurisdiction, this seems an easy way to get around the law.
posted by Roommate at 11:34 AM on October 2, 2006

We are nearing the end of the 109th Congress. Congress is out of session until November to work on getting re-elected. A companion or related bill hasn't even been introduced to the Senate yet. It seems a little alarmist to abandon internet poker now.

Actually the OP was a misleading, especially the Cardplayer link. See this current Cardplayer article as an example of the current news. The ban was attached to the "Safe Port Act" in a last-minute conference committee manuever and was passed overwhelming by both houses of Congress. All that remains is for Bush to autograph it, which will most certainly take place. This will certainly become law.

The key provision is that it criminalizes the act of accepting money for wagers. Given that the US has been quite active in attempting to prosecute executives of gaming companies of late, a number of major sites are poised to stop allowing US bettors. This includes giants like PartyPoker, which will change the entire online poker scene very dramatically.
posted by Lame_username at 11:37 AM on October 2, 2006

Yes, Neteller being the most popular. I was wondering the same thing. Neteller not being a gambling site, and outside US jurisdiction, this seems an easy way to get around the law.

Neteller has issued a press release warning of "a material adverse effect" on their business as a result of this legislation. They appear to believe that the regulations may apply to them.
posted by Lame_username at 11:46 AM on October 2, 2006

Certainly the "transfer of US funds to foreign banks" has implications for say, AllOfMP3, which relies on mostly foreign banks to accept balance deposits.

It's only banning fund transfers for gambling, not in general.
posted by smackfu at 11:54 AM on October 2, 2006

Is this a case of the Feddle Gummint wanting to stop gambling because they can't make any revenue off it?
posted by pax digita at 11:55 AM on October 2, 2006

A companion or related bill hasn't even been introduced to the Senate yet.

A House bill doesn't need to have a Senate companion, nor vice versa. Even in the case where there are companion bills, the House must pass the Senate bill, or the Senate must pass the House bill. Most enacted legislation doesn't have a companion bill at all.
posted by MrMoonPie at 12:01 PM on October 2, 2006

I thought Republicans were supposed to be about free markets? We sell a lot of shit to other citizens of other countries that may be illegal in their homelands. It's legal because when you do business online, the transaction is occuring on the seller's soil.

It's actually happening on both countries' soil. If I buy something from amazon.ca, Canadian and American restrictions would apply, as the transaction takes place in both countries—it's not complete until I receive what I ordered.
posted by oaf at 12:10 PM on October 2, 2006

Thank you nanny-state. This is all about protecting US gambling corporations.

A bank offshore will allow USians to make deposits and open accounts via the internets. And one of the things you'll be able to do with that account if gamble in offshore gaming sites.
posted by birdherder at 12:10 PM on October 2, 2006

I was also going to make a FPP on this but have been too busy with other things to pull the links together. As a regular, winning participant in online poker, I am a bit sick over this. Ethics aside, it was attached to the Port Security bill and passed as one of the last items of business before congress hit the road late Friday night. The bill contains some very gross carveouts for horse racing and lottos, so it makes the whole "moral highground" argument especially suspect. What a crock of shit.

The good folks over at twoplustwo.com one of the more active and well-informed poker-related web sites, are trying hard to find the silver lining in this, but right now there is just a lot of confusion. (For anyone else interested, the TwoPlusTwo Poker Legislation forum has the best discussions on this that I've seen).

As someone else stated, "GG online poker."
posted by mosk at 12:15 PM on October 2, 2006

Poker has - in American courts - been deemed a game of skill, instead of a game of chance.
posted by talldean at 12:25 PM on October 2, 2006

What does William Bennet have to say about this?
posted by OmieWise at 12:29 PM on October 2, 2006

What does William Bennet have to say about this?

I didn't know Whitehouse were into poker.
posted by jack_mo at 12:38 PM on October 2, 2006

I guess it's true...

Noone beat's the house!
posted by Dreamghost at 1:19 PM on October 2, 2006

My understanding of the bill was that it was going to make it illegal for CC commpanies and banks to transfer money to "illegal gambling sites", that is, sites that are already illegal. This is largely a moot point because a) most banks and CC companies already do this and b) most online gamblers transfer money using third party systems like neteller and firepay.

However, the gotcha seems to be that some publicly traded companies in jurisdictions with good standing to the US are pre-emptively going to forbid US players - this is what Party Poker and Neteller are doing. (Party Poker is based in the UK, Neteller, I think, is a US company). Offshore gambling sites are probably not going to stop offering poker, although who knows for sure.

Anyway, my point is that I don't think this affects whether or not online poker is legal - it affects whether or not you'll be able to get your money in and out of poker sites.

I, for one, have withdrawn all money that I don't need for day-to-day play out of all sites and all processing companies (neteller, firepay, etc). When things settle down I'll re-evaluate but not being able to get to that money would be a real problem.
posted by RustyBrooks at 1:47 PM on October 2, 2006

I hope poker survives, I've actually been playing it lately. Great time waster, and honestly a lot of fun.

That said, I don't see much reason to have pure-chance online gambling be legal at all. I'd love to see people be able to wager on pure skills based games though. Imagine wagering on GO or something.
posted by delmoi at 3:03 PM on October 2, 2006

God of all the horrible crap the republicans have been cramming down our throats lately of course the very last thing they do has to be the one that affects me directly. Fuckers.
posted by delmoi at 3:08 PM on October 2, 2006

I bet this doesn't work out the way they intended. Odds are people find a way around this.

So I'll hold.
posted by srboisvert at 3:51 PM on October 2, 2006

* A ban on human cloning.

so help me, at first I thought this said 'a ban on human clothing'.

That seems downright progressive.
posted by jonmc at 4:02 PM on October 2, 2006

I'd love to see people be able to wager on pure skills based games though. Imagine wagering on GO or something.

People would cheat horribly in any game of complete information. Games of incomplete information are much better for gambling purposes.
posted by Tacos Are Pretty Great at 4:47 PM on October 2, 2006

I live in the US and I am going to keep playing poker online.

Fuck Bill Frist and fuck anyone who supports him.
posted by StrasbourgSecaucus at 7:08 PM on October 2, 2006

People would cheat horribly in any game of complete information. Games of incomplete information are much better for gambling purposes.

Well, so far no computer can even beat a basic GO player.
posted by delmoi at 10:08 PM on October 2, 2006