Three of the largest online poker sites were taken over by the FBI on Friday in the probe that could bring about the death of the internet gambling industry. Websites Full Title Poker, Absolute Poker and PokerStars were all shut down and replaced with warning messages. Their owners were charged with bank fraud and money laundering.

The acronym UIGEA noted above is used to condense the name of the provisions of the so-called SAFE Port Act‘s section which was, at one time prior to enactment, referred to as the Unlawful Internet Gambling Enforcement Act. There remains a great deal of controversy surrounding the UIGEA provisions of the SAFE Port Act especially as the addition of the UIGEA language occurred through what could be described as legislative chicanery. In order to better shed light upon this issue it may be best to quote directly from Wikipedia:

The Act was passed on the last day before Congress adjourned for the 2006 elections. Though a bill with the gambling wording was previously debated and passed by the House of Representatives,^[6][7][8] the SAFE Port Act (H.R. 4954) as passed by the House on May 4th (by a vote of 421-2) and the United States Senate on September 14th (98-0),^[9] bore no traces of the Unlawful Internet Gambling and Enforcement Act that was included in the SAFE Port Act signed into law by George W. Bush on October 13th, 2006.^[10] The UIGEA was added in Conference Report 109-711 (submitted at 9:29pm on September 29, 2006), which was passed by the House of Representatives by a vote of 409-2 and by the Senate by unanimous consent on September 30, 2006. Due to H.RES.1064, the reading of this conference report was waived.

Clearly, the passage of the amended version of the SAFE Port Act was accomplished via a rather circuitous legislative route. Meanwhile, the enforcement of this Act’s provisions have been noted by some to have had a massive impact upon both the online gaming industry as well as other industries whose business models dovetail those of many online gaming endeavors.

How this whole situation will ultimately play out remains anyone’s guess, but there is little doubt that legal matters pertaining to online gaming are likely to be at the forefront of many judicial dockets in the upcoming months.

As a former licensed poker dealer himself, this blogger is somewhat saddened to hear this news as the game of Poker, both in its real-world and online forms, is a favorite pastime of many players both in the United States of America and around the world.

For related information please see: Online Gaming Lawyers.

[Senator Harry] Reid shocked many in the gaming industry late last week when he revealed that he was supporting a bill that would regulate online poker in the US. Each state would be able to opt out of the legislation, but clearly the goal for Reid was to help Nevada gaming companies with existing casinos.

Senator Reid’s support could prove to be essential to passage of online gaming regulation legislation. However, not all seem enthusiastic about Mr. Ried’s proposed legislation:

As the details of the bill have emerged, online players have become more weary of Reid’s motives. One of the more interesting stipulations surrounds the possibility that all online poker operators seeking a license would have to halt their services to US customers for a period of fifteen consecutive months once the legislation is finalized and passed.

The issue of gaming in general can be controversial in the United States and around the globe, but the issues surrounding online gaming bring to light all sorts of legal and policy issues as Larry Rutherford noted in his article also on casinogamblingweb.com:

University of Illinois Business Professor and longtime opponent of online gambling regulations in the US John Kindt has again made statements about the issue of late…

Apparently this professor advocates strongly against online gaming. Many opponents to gaming legislation cite the problems which can arise as a result of the spread of gaming. That said, Rutherford’s posting pointed out that online gaming is becoming increasingly prevalent:

Senator Harry Reid and Representative Barney Frank are both pursuing online gambling legislation that would regulate the industry. The lawmakers take the opposite position of Kindt, understanding that Internet gambling is already a big part of society in the US….

One facet of the online gaming debate that many feel is often overlooked in the overall discussion of the various aspects of the issue is the economic argument in favor of online gaming. As Rutherford’s piece went on to note further:

Online gambling would only help the economy recover with the thousands of jobs regulations would create. Millions of dollars in tax revenue that is currently going out of the US would also stay within the borders. Instead of paying companies in other countries, the millions of online gamblers would be pumping money into US-based companies that pay taxes and spend money in the country.

In addition to the revenue and jobs, online gambling regulations would also place spending limits on Internet gamblers, something that currently does not exist in full regulation. Problem gambling is addressed in Representative Frank’s online gambling bill, and almost certainly would be included in any legislation proposal by Senator Reid passed as an amendment to the tax cuts bill.

Although no one can foresee what the overall impact of this legislation could be. There are many who feel that properly regulated online gaming in the United States would be a significant benefit to the American economy as jobs would be created to deal with what appears to be substantial demand for services both directly and indirectly related to gaming.

[T]he Congressional session in the US begins again in both the House and the Senate. One of the pieces of legislation that may be discussed is Representative Barney Frank’s online gambling bill. Online poker players and gamblers are urged to call their senators and representatives to support the bill.

Rep. Frank introduced HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act earlier this year. Before the recess of the House, the House Financial Services Committee passed Frank’s legislation. The next step will be to take the issue to the entire House, and then possibly on to the Senate.

For the process to get done in a timely manner, it is recommended that all online poker players, or anyone interested in seeing online gambling prohibition stopped, call their representatives in their jurisdiction. The more pressure that is put on these representatives, the better chance that Frank moves his bill along in the coming session.

To pass the law in the coming months is essential to the millions of Americans who currently engage in online gambling. In November, the political structure may change and Republicans may seize control of the House. If that occurs, it is likely that Rep. Frank would lose his Chair status in the House Finance Committee. Frank’s likely successor would be Rep. Spencer Bachus, one of online gambling regulation’s biggest opponents.

Proponents of regulated online gaming point to the numerous economic benefits which could be accrued through effective regulation of online gaming in the United States. This argument is ringing especially true in the USA as unemployment and other economic issues weigh heavily on lawmakers and the public at large. There are those who argue that regulated online gaming would create jobs and tax revenues for a Federal government that could use both. To quote the aforementioned posting further:

With only one month left before the mid-term elections, many analysts believe it is unlikely that Frank would move forward with the controversial issue leading up to the elections. Republicans could force Democrats into taking a position on Internet gambling, and then use that to gain leverage in many upcoming House battles.

Frank, however, may understand that if the climate changes and he is ousted as the Chairman of the Finance Committee, then the likelihood of gaining Internet gambling regulations will become slim. That fact alone may sway Frank to push hard for the regulations in the coming weeks.

It is unknown what the future holds for Frank’s bill, but one thing is certain, the millions of people who enjoy playing poker online need to be heard. CGW is encouraging everyone who wishes to have the online gambling laws changed in the US, to contact their representatives and senators in the coming days and have your voice heard.

This author does find logic in the argument that regulated online gaming may create major economic benefits for Americans and the Federal Treasury. That said, there are those who feel that it is unlikely that this legislation will be passed in this session of Congress. This Bill could have a significant impact on the American economy at a critical time, but there may not be enough political will to pass this legislation at this time. Online businesses continue to bring incredible opportunities to the United States of America. The internet is still a significant platform for all types of trade and commerce. This author can understand any government’s desire to regulate and monitor the activities of online gaming enterprises. However, the current state of affairs in the USA would seem to be virtually untenable from a legal standpoint as the law itself is somewhat vague on certain issues and enforcement of these rules could prove nearly impossible. Furthermore, there are multiple Constitutional issues which could be raised by those challenging the provisions of the UIGEA. Therefore, due to all of the uncertainty surrounding the online gaming industry in the USA, it may be time to promulgate rules which clearly and effectively regulate the US online gaming industry.