Online Poker in the US Faces November Test

The current state of online gambling, and the struggle to get it restored, emanates from the 2011 ruling by the Justice Department and the US Fifth Circuit Court of Appeals that the 1961 Wire Act outlawing the use of wired communications facilities to make bets applied only to sports betting and not online poker. Though opening the door for online poker, states have been slow to regulate and tax online gambling, with only New Jersey, Delaware and Nevada being states that have passed laws to allow, regulate and tax online gambling. The speed and extent to which states follow suit is the current issue-at-arms.

The Current Climate

So what happened before the ruling? Online operators were very popular from the time the internet came out until 2006, when Congress passed the “Unlawful Internet Gambling Enforcement Act,” illegalizing the act of accepting payments “in connection with the participation of another person in unlawful Internet gambling.” This diverted gambling revenues and activity back to live casinos, a redirect culminating with the 2011

violation of Poker Stars, Full Tilt Poker and Absolute Poker/Ultimate Bet were charged with violating the Unlawful Internet Gambling Act, resulting in closure of online gaming entities in the US.

The Final Challenge?

However, as Nevada, New Jersey and Delaware exemplify models of adaptation, new November legislation called the Restoration of America’s Wire Act could threaten the online poker market in the US once again.

Introduced by South Carolina Senator Lindsey Graham and Utah Rep. Jason Chaffetz, the Restoration of Americas Wire Act is also backed by Sheldon Adelson and the Coalition to Stop Internet Gambling.

The bill would restore the Wire Act, whose passage would cause Delaware, Nevada and New Jersey to end online poker and/or online casino game offerings, and would conclude the proceedings of any states states developing regulatory guidelines for same.

The conservative states and conservative elements in society will always put up strong arguments and campaigns against gambling, but a precedent establishing once and for all the ability of moral arguments to forestall the more pragmatic issues of business and revenue to be gained from online gambling will be clearly defined.