Online Gambling

Due to online poker‘s Black Friday in April of 2011, the number of online casinos that continue to accept real money players from the United States is shrinking every day. Often, this decision is made not by the online casino operator itself, but rather by the online casino software vendor. Rival Gaming is a recent example of an online casino software vendor that has recently informed its licensees that they are no longer permitted to accept players from the United States.

In the wake of the recent FBI indictment of several prominent online poker room owners / principles, some online casinos (primarily some Rival online casinos) have elected to leave the US market, similar to what happened in response to the passage of the UIGEA in 2006.

I’ve recently been in contact with the owners of several 5-star rated Real Time Gaming (RTG) online casinos, who assured me that their doors remain open to US-based real-money players. Of of these sites — Intertops — has served US players uninterrupted since 1996.

So, if you’ve been locked out of your favorite online casino, why not give these a try? You won’t be disappointed.

Slots of Vegas
$100 FREE + 300% bonus on initial deposits between $30 and $100!
Slots of Vegas, with over 80 online slot games, is the premier source of slot games for real or fun money. Slots of Vegas offers the loosest online slots, from the traditional three reel slots to the adventure packed five reel slots.

Silver Oak Casino
$50 FREE + 250% bonus on initial deposits between $25 and $100!
Bonus codes: FREE50SILVER and 250WELCOME. Silver Oak Casino has the most dedicated customer service staff in the industry. Our knowledgeable and friendly representatives are available round the clock to assist you with any concerns you have.

Intertops RED Casino
100% bonus on initial deposits between $20 and $100!
No-download version available!
Bonus code: SIGNUP100. This RTG casino from Intertops is open to ALL US players and delivers all the fun and excitement that you would expect from an RTG casino and combines it with the trust, security, and outstanding banking

The FBI has shut down Full Tilt Poker, PokerStars, UltimateBet, and Absolute Poker. Visitors are shown a message saying, “This domain name has been seized by the F.B.I. pursuant to an Arrest Warrant.”. (Read the full article at the LA Times.)

Until all of this gets sorted out, here is a list of  the top 5 online poker sites that accept US players. (In case you are interested, here is the full list of all online poker sites that accept US players.)

Bodog Poker: 110% bonus
Create an account and download Bodog Poker for free with our Getting Started Guide. Play free online poker on our play money tables or head straight to the real money tables and earn Bodog Poker Points.

Sports Interaction Poker: 110% bonus
Bonus code: signup110. You can play for free, or at our 24/7 cash games and enter any of the tournaments of your choice. All you have to do is download, register, and play.

Poker4Ever: 100% bonus
POKER4EVER.com is a fast-growing cardroom offering your favorite poker games: Texas Hold’em, Omaha, Omaha Hi, Omaha Hi/Lo, and 7 Card Stud. POKER4EVER.com also offers the ultimate tournament experience with its multi-table tournaments

BetUS Poker: 110% bonus
We have an amazing new first time deposit bonus for all our new players. We offer you 110% bonus up to a fantastic $1000. Simply make a deposit, in the poker room click rewards, deposit bonus and enter the code POKER1000.

Doyles Room Poker: 100% bonus

You won’t be able to find another poker room where you can participate in tournaments, ring games and heads up matches with Doyle Brunson — author of SUPER SYSTEM (the bible of poker), winner of 10 WSOP Bracelets and player in every single WSOP.

As reported in yesterday’s The Wall Street Journal, the House Financial Services Committee voted 41-22 to approve legislation that would regulate many forms of online gambling, including poker and bingo, while specifically banning betting on major US sports leagues like the MLB, NFL, NBA, and others.

Other news articles point out that the legislation also would deny licenses to any online site that has allowed, or currently does allow, US players to gamble online. Looking ahead, this would appear to effect PokerStars, FullTilt, and other online poker rooms that have continued to serve US players despite the UIGEA of 2006.

Other key elements of the legislation include player loss limits, rigorous age verification systems and frequent testing thereof, and allowing states to opt out of this legislation and ban its citizens from online gambling.

And the legislation that was passed does not cover how the industry is to be taxed — that’s covered in a separate bill that hasn’t made it out of the House Ways and Means Committee.

It is unlikely that this legislation will be voted on before the current Congressional Session expires in September. The scheduling is simply too tight. If it is not voted on, the process will need to start again next session. Perhaps it will be attached to some other legislation, as was the UIGEA of 2006. Even so, if the legislation is approved, it still would need to be signed by Obama.

We are still years away from any comprehensive online gambling policy in the United States. Need proof? The UIGEA of 2006 took nearly 4 years before it actually went into effect this past June 1 — and there are still plenty of loopholes in that legislation that allow US players to fund and withdraw money from their online gambling accounts… or so I’ve heard.

Godfrey provides some staggering numbers regarding the billions of dollars that the United States is leaving on the table by not legalizing and regulating internet gambling. I mean really — haven’t we seen enough jobs lost in the past 5+ years across a wide range of industries to convince us that we need to find new industries in which compete and perhaps even dominate?

U.S. lawmakers — open your eyes.

This Barney Frank guy is serious…. I’ll give him that much. There can be no doubt that this guy is seriously against online gambling prohibitions. At every stage of the game, he’s in there trying to get hearings, trying to sway votes, writing letters, giving interviews.

A recent InformationWeek article reported that Frank wrote a letter to U.S. Treasury Secretary Henry Paulson, in response to the finalization of the UIGEA regulations.

“I am deeply disappointed to hear that your agency is proceeding with what I consider to be unseemly haste in issuing regulations implementing the Unlawful Internet Gambling Enforcement Act. This midnight rule-making will tie the hands of the new administration; burden the financial services industry at a time of economic crisis.”

In the final analysis, I do not think that sending the letter will do any good… it’ll be up to the Obama administration to take the necessary steps to curb or stop the regulations from being enforced.

Yesterday, the United States Treasury and the Federal Reserve Board jointly issued a press release announcing the finalization of UIGEA regulations. The press release includes a link to the actual regulations, a 60+ page document that contains various regulations with which banks have been given a year to comply.

I published my analysis of the UIGEA regulations when they were published in draft form about a year ago. In the coming days, I will be reading the finalized regulations and offering my analysis here.

One initial thought is that the 12 month window that banks have to comply with the regulations is ample time for the Democratic Congress and new Obama Administration to take action to completely repeal the entire UIGEA. More on that later….

The outgoing Bush administration is trying to pull a fast one in its last days in power. According to a 11 Nov 08 Dow Jones Newswire:

The Treasury Department has finalized regulations that would effectively ban online gambling in the U.S. and is trying to have them implemented in the waning days of the Bush administration.

The controversial rules would make it illegal for banks to process credit card transactions from most Internet gambling sites.

Their implementation has been opposed by groups advocating individuals’ right to gamble, the banking industry, Democratic lawmakers in Congress and even officials at the Federal Reserve.

The rules stem from a last-minute addition to a law passed in the final hours of the Republican controlled Congress in 2006. The provisions related to online gambling were included in an unrelated port security bill.

The wire goes on to say that it is “…standard practice for outgoing administrations to finalize controversial regulations before leaving office, a practice known as a midnight drop.”

Really? The global financial markets are in crisis and the U.S. government — our government — wants to add more work for our banks? I don’t think that this is where our priorities should be at the moment!

Have your voice heard by providing feedback to the Federal Reserve Board via their Contact Us page. Select the second radio button, select Consumer complaints from the drop down list, and enter your views in the text box. Here is a template that you can use to get you started.

I am writing to express my concerns regarding the Treasury Department’s finalization of regulations to enforce the Unlawful Internet Gambling Enforcement Act of 2006. I understand that the regulations were finalized and forwarded to the Office of Management and Budget on Oct. 21, 2008, and am opposed to their being put into practice.

There are two reasons why I am opposed to the implementation of these regulations:

1. The global financial markets are in turmoil. The world is looking to the United States banking system to provide the stability necessary to get financial markets back on track in as short a time as possible. If the proposed regulations were put into practice, this would result in lost time, energy, and effort on the part of our banks in dealing with compliance with the regulations. Our banks’ priorities need to be on staying solvent and providing leadership in this time of crisis!

2. The impact on the average American citizen has not been studied. If US banks were required to comply with these regulations, there is no telling what the impact on the bank’s customers may be. The issue needs to be studied, and that study must include thought-leadership from the banks themselves, and not lawmakers.

If you want to call them, please do!

• Consumer Complaints, 888-851-1920
• Public Affairs, 202-452-2955

On October 1, the United States Treasury Department and the Federal Reserve jointly published a draft of the guidelines to enforce the Unlawful Internet Gambling Enforcement Act (UIGEA) of 2006. Published late — they were due this summer — the 52-page document:

• proposes rules to implement the UIGEA
• designates and defines payment systems to be regulated
• requires participants in designated payment systems to establish policies and procedures reasonably designed to identify and block or otherwise prevent or prohibit transactions in connection with unlawful Internet gambling
• exempts certain participants in designated payment systems
• describes the types of policies and procedures that non-exempt participants in each type of designated payment system may adopt in order to comply with the Act
• includes examples of policies and procedures
• does not specify which gambling activities or transactions are legal or illegal, deferring instead to underlying State and Federal gambling laws

Comments are due by December 12, 2007, and can be submitted in writing or electronically. Once the rules are finalized, the draft calls for the rules to go into effect six months after that date (although this could change based on the commenters, like the banking industry).

I’ve read this draft, and wanted to share some thoughts.

• Individual gamblers are not targeted by the UIGEA. From page 7:

The proposed regulatory definition clarifies that an end-user customer of a financial transaction provider is not included in the definition of “participant”, unless the customer is also a financial transaction provider otherwise participating in the designated payment system on its own behalf.

• The draft makes it clear that it will be difficult to monitor certain popular payment systems. This suggest to me that payment via these methods — particularly via check, in my opinion — will rise in popularity once these rules go into effect. From page 13:

While other systems, such as the card systems, have developed merchant category and transaction codes that identify the business line of the payee (e.g., the gambling business) and how the transfer was initiated (such as via the internet), so that the systems are able to identify and block certain types of payments in real time, the ACH systems, check collection systems, and wire transfer systems do not use such codes.

• The draft suggests that some payment systems will, for the most part, be exempt from having to follow the rules. This is good news for US gamblers, and suggests to me that the UIGEA will only make it more difficult for US gamblers to gamble, but will fall well short of putting an end to all internet gambling by US citizens. From page 13-14:

As a result, the preliminary view of the Agencies is that it is not reasonably practical for the exempted participants in ACH systems, check collection systems, and wire transfer systems … to identify and block, or otherwise prevent or prohibit, restricted transactions under the Act.

• Something that is troubling to me is that if a person blocks payment for the reasons in the draft (see excerpt below), then that person is not liable for any adverse results that may occur to the person that had the transaction blocked. I can imagine a scenario where a person has a legitimate transaction blocked, and that person is subsequently charged non-payment / bounced checks fees. That person would have no grounds to collect these fees from the person that blocked the legitimate transaction! From page 18:

Section 5 also imports the Act’s liability provisions, which state that a person that identifies and blocks, prevents, prohibits, or otherwise fails to honor a transaction is not liable to any party for such action if (i) the transaction is a restricted transaction; (ii) such person reasonably believes the transaction to be a restricted transaction; or (iii) the person is a participant in a designated payment system and prevented the transaction in reliance on the policies and procedures of the designated payment system in an effort to comply with the regulation.

• Another thing that is interesting to me is the use of the term “reasonably designed” throughout the draft. This is just asking for these rules and regulations to wind up in court, because what is reasonable to one person may not be seen as reasonable to another person (or to the government). In my opinion, we’ll see a court challenge shortly after the rules go into effect that will further delay the complete implementation of the rules to enforce the UIGEA. It’ll be years before this is all sorted out.