POKER/GAMBLING NEWS

yes i agree, they usaly do anything for tax money, ty josie46

Bank employees began getting suspicious when they saw many large checks issued by a Naples man’s company, according to an ongoing federal investigation.

When questioned, customers cashing them explained the MCM Capital Management checks were payments from Internet Poker gambling winnings.

When bank tellers and managers saw millions of dollars in wire transfers going in and out of Michael Olaf Schuett’s bank accounts, many shut down accounts for the hundreds of companies he owns after discovering they were linked to gambling, federal documents say.

For FedEx employees, it was the roughly 51 packages being mailed daily from his Chesapeake Avenue home that made them question what the 29-year-old was doing there.

“Federal Express employees became suspicious of Schuett’s activity when Schuett began mailing over 150 parcels per week,” says a federal complaint alleging Schuett is involved in money laundering. “FedEx employees opened several of the parcels and determined that each contained a check.”

Those are the allegations outlined in a 39-page complaint filed in U.S. District Court, Fort Myers, that shows Schuett is the target of a federal investigation.

Schuett, also known as Schütt, a German national whose visa expires in April, is being held without bond in Lee County jail after a federal judge ruled Monday he was a flight risk.

U.S. Magistrate Judge Sheri Polster Chappell cited his limited ties to this country, that he’d been married only a month to a woman he’d known for nine months, that he lives in Germany, and has no employment ties here.

“The court further takes into account the amount of money involved in the alleged crime and the number of bank accounts used to conduct the scheme,” Polster Chappell wrote in her ruling, citing 40 accounts opened at Bank of America.

In denying bond, she also pointed out Schuett was planning to purchase a house using illegal funds. “The house was going to be put in only the defendant’s new wife’s name,” she wrote.

Federal investigators seek to seize nine bank accounts Shuett holds under his name and company names: MCM Capital Management Corp.; MI Global Inc.; South Naples Escrow Co.; Southwest Florida Payroll Co.; Woodhouse Systems; Mathew’s Trade Corp; and Internet Payment Services Group Inc.

As of Feb. 12, the complaint says, there was $2.13 million left in accounts at Bank of America, Ironstone, SunTrust, Regions Bank, BB&T, Iberia Bank and Royal Bank of Canada.

Schuett’s federal public defender, Frank Zaremba, could not be reached for comment. Phone numbers listed for Schuett have been disconnected.

The condominium Schuett lived in is owned by Jean and Kenneth Nitsche. Jean Nitsche declined comment on Schuett.Collier County records show Schuett’s new wife is Jennifer Sherman, 28. She could not be reached for comment.

In the complaint, Special Agent Nicholas J. Menster of the U.S. Secret Service, asked the judge to allow funds to be credited to Schuett’s bank accounts, but to prohibit payouts for 14 days from when a search warrant is issued.

Federal agents asked to search Schuett’s home and seize computers and his Powership Federal Express shipping device, which would provide evidence showing where packages were shipped. Feds also seek to seize a 2009 Audi Quattro, three expensive Rolex watches, cash and other property they contend were purchased with illegally gained funds.

The complaint says Schuett’s car, whose tag is USAG24 — in the name of one company he operates — was purchased for $23,487.20 at Audi of Naples in December. Schuett bought the watches at Mayors Jewelers at Coconut Point Mall in Estero, reports say.

The complaint says Schuett incorporated numerous companies in Naples, Tampa and Bradenton. State incorporation records show that through USAG24, he’s the officer and registered agent for 424 businesses, but he owns others under his name.

However, the state Bureau of Financial Investigations said Schuett has never registered as a money transmitting business, which prevents money laundering. The complaint shows the amount of money involved would be a first-degree felony.

The complaint indicates Schuett became a target after many customers came to banks with large checks issued by MCM Capital Management.

“On several occasions, recipients of the checks have advised bank tellers and bank investigators that the checks they received from Schuett’s companies are winnings from online gambling,” the complaint says.

The investigation shows Schuett had opened about 40 accounts with Bank of America over the past three years and since Nov. 1, 2007, received wire transfers and transferred about $70 million to 23,000 persons, mostly in the United States.

“As a result, numerous banking institutions throughout the state of Florida have closed accounts associated with Schuett,” the complaint says.

In addition to the bank accounts being frozen, he also had accounts with Wachovia, Shamrock, CNL, Fifth Third and Northern Trust Bank of Miami.

The complaint gives this account:

Overseas wire transfers of money went into accounts operated by Schuett, who then obtained large numbers of cashier’s checks, wrote business checks, and sent wire transfers to customers in the United States or Canada. Large amounts of money came from Bluetool Ltd., a British company, and International Payment Systems, a German company.

When one bank official asked Schuett if he was involved in gambling businesses, he denied it. Between Nov. 24 and Jan. 21, $2 million was transferred in and out of accounts operated by Schuett at Bank of Florida, Bank of Florida Southwest, and Bank of America. Most of it originated from Bluetool Ltd. through a German bank.

Between Aug. 13 and Dec. 1, Bluetool made 28 wire transfers totaling $7.3 million to bank accounts owned by Schuett’s companies.

“It appears online gambling companies are using Bluetool Ltd. as an intermediary to transfer funds to U.S.-based money transmitters in order to pay gambling winnings to U.S.-based online customers,” the complaint says, calling Schuett a money transmitter. “Online research suggests that many of the customers are online poker players.”

Four checks totaling $20,000.87 went to Corey Drury, whose Facebook account says he is a mid- to high-stakes card player employed by Absolute Poker, Full Tilt Poker, and Pokerstars.

Three totaling $15,000.43 went to Darren Elias, who is listed on various poker Web sites such as poketfives.com, bluffmagazine.com, cardplayer.com, and pokerpages.com. And four totaling $20,000.61 went to Derek Dubois, a poker player listed on bluffmagazine.com.

Meanwhile, Schuett’s Bank of America statements warned accounts couldn’t be used for illegal transactions, including unlawful Internet gambling.

From May 22 through Sept. 29, there were 27 incoming wire transfers totaling $2.17 million to a Fifth Third Bank account Schuett opened May 22 for IPS Corp. Most were from Bluetool Ltd. And 2,508 checks were written that withdrew $1.85 million from that account, which was closed Sept. 30, although Schuett had other accounts there.

From Oct. 1 through Nov. 4, MCM Capital Management Corp.’s Wachovia account received 15 incoming wire transfers from Bluetool that totaled $2.16 million.

A Wachovia bank officer questioned customers cashing checks issued by MCM Capital Management and three said they were winnings from Internet gambling poker gaming sites, while another customer refused to explain. When the officer questioned Schuett, he told her he services Bluetool by paying commissions to U.S. and Canadian citizens who use Bluetool’s Web site. The bank officer advised Schuett she believed he was operating an online gambling company.

“Schuett replied to the effect, ‘Well, it’s not like it’s illegal,’” the complaint reads.

When the officer informed him online gambling was illegal in the United States and that she was going to immediately close his account, he asked her to wait two weeks so he could settle them and transfer funds to Shamrock Bank, where he had an account.

When Schuett opened an account for South Naples Escrow Co., he told employees there it was for real estate transactions for German nationals buying property in Florida. Shamrock employees reported to federal investigators that the account was very active, but that activity wasn’t consistent with real estate transactions, which usually involve checks to title companies.

From Oct, 26 through Dec. 7, 23 wire transfers totaling $5.7 million came in to the account, while $2.22 million went out to Schuett’s companies. In addition, 20 checks totaling $3.66 million were issued, most to his companies.

A bank officer questioned him about the unusual activity, but Schuett maintained it was for real estate. On Dec. 2, a bank manager told him the account would be closed due to large activity. Bank of Florida Southwest also terminated an account in January due to suspected Internet gambling activity. Schuett told officials there he was an investment consultant.

Lips

Source:  marconews.com

Iowa maybe the first state to legalize online Poker.

Like many states in the US, Iowa is looking to shore up its statewide debt of over $400 million. And the Hawkeye state sees regulated poker as the perfect solution to its dilemma.

State representative Doug Struyk (R-Council Bluffs) is one of the main lawmakers who is pushing for regulated intrastate poker in Iowa. Struyk has cited the large number of online gamblers in Iowa as reasoning for why he thinks intrastate poker could be a major source of revenue for Iowa. Struyk said that more than 50,000 people gambling online in Iowa.

Struyk’s plan would allow Iowa residents to deposit money at state-run casinos, and then use that money to play games such as online texas hold em. There are 17 casinos in Iowa and the money deposited at these gambling establishments would enable the state’s residents to play poker against each other.

The Iowa Racing and Gaming Commission regulates all 17 casinos in Iowa, and they’re hoping to use online poker as a means of boosting their business. Estimates state that regulated online poker could bring in an extra $11.5 million to the state through gambling revenue.

Iowa gamblers are excited about the plan too since intrastate poker would give people a chance to play all of their favorite card games. Everything from limit texas holdem to Omaha would be offered to players over the Internet.

Chances are good that the intrastate poker bill could pass since Iowa has already proven to be a pioneer in the gambling industry before. Iowa was the first US state to legalize riverboat gambling. The state also opened its first casino in 1991 at a time when many other states were still deciding on the issue.

Thumbs up to Iowa then.  There's quite a lot going on at the mo.....

"Harrahs, IGC and Pokerstars invest in promoting the legalisation of online gambling

The McClatchy-Tribune Information service reports that an online gambling market estimated to be worth $20 billion globally this year continues to attract pro-online gambling investment in lobbying activities.

The service reports that according to mandatory disclosures, Harrah’s, the world’s largest casino operator, has spent more than $3 million in the past year to promote online gambling, and that the Vancouver-basedInteractive Gaming Council contributed at least $2.3 million to the pro-online betting effort.

In addition, PokerStars, the world’s largest online poker room, paid $300 000 through an intermediary to Representative Dick Gephardt, a former House Democratic leader and presidential aspirant from St. Louis who now runs a lucrative lobbying business.

Opposing online gambling legalisation are the professional sports leagues; apparently the National Football League alone paid a single lobbying firm $800 000 last year trying to derail Congressman Barney Frank’s federal legislative attempt to legalise and tax online gambling in the United States."

And the biggest shock of them all

"Local politician proposes the regulation of intrastate online gambling

Beating his federal political colleagues to the punch late last week, Florida Representative Joseph Abruzzo introduced a bill titled the Internet Poker Consumer Protection and Revenue Generation Act of 2010.

Florida has been examining the issue of online gambling, specifically poker, for some months as a state body prepared a report for the legislature, but Abruzzo appears to have taken the initiative in an attempt to get the ball rolling and short-circuit the implementation of the UIGEA regulations scheduled for June 1st this year.

Abruzzo's legislative proposal suggests a fully regulated system of online gambling in the state, relying on a provision in the Unlawful Internet Gambling Enforcement Act of 2006 that acknowledges and retains the right of individual states to legalise online gambling within their boundaries.

The new bill proposes strict regulatory measures with which operators will have to comply. These include rigorous licensing conditions and an application fee of $500 000 payable to the Pari-Mutuel Wagering Trust Fund of the Department of Business and Professional Regulations in Florida.

A $1 000 annual licence fee and tax provisions are also envisaged, along with strict operating requirements concerning vulnerable and underaged gamblers and precautions against the involvement of crime and the prevention of money laundering. Gamblers aged 21 years or over will only be accepted, and limits on time spent gambling and amount wagered are planned. The software used will have to be independently certified as fair.

Abruzzo proposes a tax rate of 20 percent on gross win, payable on a monthly basis by operators. "

Saturday, March 13 broadcast scheduled

Television network CTV W5 in Canada is to broadcast its take on Internet gambling in an early evening slot on Saturday March 13.

Titled 'The Jackpot', the show "delves into the world of online gambling, a story that takes viewers from the sandy shores of Caribbean tax haven Antigua, to Quebec's Kahnawake Reserve, the unlikely world capital of online gambling," according to the publicity blurb.

"Constantly proving itself as the most-relevant current affairs program in the country, W5 looks at how a small group of Mohawks of Kahnawake have created a gambling Mecca to rival Las Vegas and Monaco, while defying Canadian and American laws," the press material adds.

Almost inevitably, the high profile founder of the Bodog group, Calvin Ayre, is on the interview list of investigative reporter Victor Malarek.  Ayre is described in the publicity material as "...a one-time pig farmer who became a billionaire with Bodog.com, one of the world's leading online gambling sites."

W5 prides itself on delivering factual and comprehensive programmes and this latest offering claims to trace the roots of online gambling from the Mohawk Indians of the Kahnawake Reserve to a global industry worth billions of dollars a year.

CTV W5 specialises in investigative current affairs programs and has presented shows on everything from the used car business and criminal cases to health issues and bombings in northern Canada.

Where to find poker related videos, news, learning books? How I download it?

Where to find poker related videos, news, learning books? How I download it?

 

Remove your signature link and I'll tell ya!

Treasury gave an assurance that the UIGEA regulations will not be further postponed

Online gambling's arch enemy, the Republican senator from Arizona Jon Kyl, apparently chose a potent and successful tactic to ensure the UIGEA regulations are not delayed beyond June 1st. His blocking of key US Treasury appointments during approval hearings resulted in an assurance from Secretary to the Treasury Tim Geithner that no further postponements of the controversial regulations would be permitted.

Congressman Barney Frank, a tireless campaigner for the regulation and taxing of online gambling in the United States, revealed details of the Kyl power-play this week in an interview with the publication Poker News.

"It appears the power play by Sen. Jon Kyl (R-Ariz.) in blocking President Obama's Treasury nominees from taking office worked, strong-arming Treasury Secretary Timothy Geithner," the publication reports, quoting Frank as saying: "Geithner promised he won't delay the bill again because Kyl was holding up all the nominees."

Kyl lifted his block in early February, apparently after getting what he wanted from Geithner.

Poker News reports that Frank isn't concerned about the development. He believes that, in the long run, UIGEA regulations going into effect will help to eradicate the flawed legislation rather than just delay it.

"It's fine with me," Frank said. "I think it's frankly so dumb and oppressive that it will create support to repeal the bill. I think, once it goes into effect, banks are going to raise hell and all the bankers will go to the Senate to complain."

Franks's own HR2267 bill seeking to regulate online gambling in the USA is currently supported by a bi-partisan group of 66 Washington DC politicians and is expected to be presented for mark-up soon.

Party Poker announced that the mystery man who uses the online handle Isildur1  will be taking his seat for their televised cash game, The Big Game IV.

This anonymous Swede has certainly got tongues wagging in the poker world as to his identity and he is likely to be wearing some sort of mask to cover his face during the televised event and protect his identity.

The high-stakes poker cash game will be filmed at the Les Ambassadeurs Club in London from April 11th to 13th.

British Model wins £1.1million poker tournament and proves she's not just a pretty face!

Liv Boeree, 25 has a degree in astrophysics and beat 1,240 other players to scoop the top prize of £1.1 million. In the final hand she showed a pair of 5's against Swede Jakob Carlsson's ace six.

Liv is only the third woman to win the EPT.  Her nick is "Iron Maiden" because she loves heavy metal music.  Her total winnings are £1.8million in just three years - but she still lives with her parents in Milstead, Kent.

She will now go on to contest the EPT grand final in Monte Carlo on Sunday.

Oh and guys - no point in dreaming of dating this gorgeous beauty, she has a fella already....US card ace Allie Prescott.

Hey I also play poker and like to keep up with the latest news. Thanks for updating me.

Co-sponsors for HR 2267 now up to 68

Congressman Barney Frank continues to attract Capitol Hill co-sponsors to his HR 2267 bill, which seeks to legalise online gambling in the United States and overturn the UIGEA .

In an environment that appears to be increasingly in favour of the idea of regulation rather than prohibition, the Frank legislative proposal has so far attracted 68 co-sponsors.

Latest to sign on for the initiative is a Nevada politician, Representative Dina Titus from the Nevada third district. She was preceded by New York representative William Owens as the 67th politician supporting the bill.

McDermott and Frank bills both due for debate

It looks as if a companion bill to Congressman Barney Frank’s HR2267 may be the subject of a hearing later this month ahead of HR 2267 itself.

Staffers in the office of Representative Jim McDermott have hinted that May 19 and 20, although not yet confirmed, could be the dates on which his Gambling Regulation and Tax Enforcement Act will be discussed in a House Ways and Means Committee hearing.

Political observers point out that if such a hearing eventuates, it will be the first time the bill has enjoyed its own focus – on taxing a liberated US online gambling market – in the House.

Bringing the McDermott bill into the spotlight could complement its companion Frank bill, which seeks the legalisation of online gambling. In December Frank held a hearing on his HR2267 bill in the House Financial Services Committee, and is on record as saying another hearing is likely in May.

Frank’s other legislative proposal, which has the objective of delaying the implementation of the Unlawful Internet Gambling Enforcement Act until the legalisation issue is resolved, would appear to have little chance of success.

Proponents of the UIGEA have already been angered and frustrated by the successful postponement of the regulations to June 1st this year, and there appears to be little appetite in the Obama administration for a further extension.

A hearing scheduled for April 16 was postponed indefinitely due to a scheduling problem in Frank’s office and nothing further has been heard on it.

In these difficult economic times, when both federal and state budgets are under considerable stress, the potential of the McDermott bill to generate billions in tax revenues and increase employment opportunities is a powerful attraction, with the potential to improve the chances of the Frank bill that it complements – the bills are mutually supportive.

thanks for the updates

Appeal could see escalation to the Pennsylvania Supreme Court

Poker organisers Diane Alice Dent and Walter Leroy Watkins have to be among the most determined fighters for poker to be recognised as a game where skill is more important than chance; the duo’s case could now be headed for the Pennsylvania Supreme Court.

The couple, who were accused in 2008 of running a poker game in which no rake applied in the garage of a private home, have appealed a Superior Court ruling that had earlier overturned a lower court finding that poker is predominantly a game of skill and therefore falls outside the scope of ‘illegal gambling.’

The case started its long journey through various courts when a police sting operation resulted in the prosecution of the duo, and the Poker Players Alliance has been fighting poker’s corner in supprting the two Pennsylvanians.

The PPA’s executive director, John Pappas, feels there is a good chance a Supreme Court appeal will be successful, saying: “The [superior Court] judges did not look at what was presented before them, but rather looked at other court cases in other states that said poker is a game of chance. They didn’t take into account any of the most recent academic studies and legal victories.”

The case has seen the presentation of some highly technical testimony dealing with the advantages of skilled players over less experienced gamblers in identifying opportunities to bluff, master odds, and interpret live tells.

It was to no avail in the Superior Court, however, where a panel of three judges voted 2 to 1 that chance is the predominant factor in the game, quoting from cases in other states.

Poker players warning:

Active review on moves to fix the problem being conducted by the Commission

The Kahnawake Gaming Commission has sounded a note of caution for players regarding the encryption issues which surfaced late last week at the Cereus Poker Network.

In a statement Tuesday, the Commission noted that the mechanism used by Cereus for network transmissions contained the “potential for player gaming data to be improperly accessed under certain specific circumstances”.

“The Commission is actively reviewing this matter with senior management of AbsolutePoker.com and UltimateBet.com and with its approved agents,” the KGC statement revealed, giving an undertaking to the player community that it would issue a further notice as soon as its review has been completed.

The statement continues: “The Commission is monitoring immediate measures that are being taken to address the security issue and is advised that a more permanent solution is to be implemented on an urgent basis.

“Based on information available at this time, it appears unlikely that player gaming data was actually compromised. However, this possibility will be reviewed further and, if necessary, the Commission will direct that the appropriate remedial actions be taken.

“Until a solution to the security issue is fully implemented, the Commission recommends that players use caution when accessing the AbsolutePoker.com or UltimateBet.com sites and, in particular, when using a wired or wireless public network or a private wireless network.”

Thanks, I'm eager to see what happens with Frank's bill.

Thanks Blue,I love playing poker too and I sometimes do not read the e-mail I get from the poker alliance but I ty to keep up with with posts on LCB.We need to stay informed and hopefully in the not to distant future we will be able to play our favorite games weather it be poker,slots,video poker or whatever.Once again, thank you for keeping us informed.

I agree bingocrazy, the sooner USA is unrestricted the better.  Freedom of choice doesn't come into it at the moment.

blue

Wednesday’s House Ways and Means Committee hearing will be closely watched

Today’s (Wednesday) hearing on Representative Jim McDermott’s proposal to tax a legalised online gambling industry in the United States has attracted some heavyweight political and other names

The House Ways and Means Committee has published a witness list that includes both pro and anti Internet gambling personalities like Congressman Barney Frank and Representative Bob Goodlatte, along with civil service representatives from the United States Treasury and Internal Revenue Service.

Christopher Wagner, Commissioner of the Small Business Self-Employed Division will represent the interests of the IRS, whilst Rebecca Sparkman, Deputy Director for Operations for the Criminal Investigation Division is also listed.

Charles Steele, Deputy Director of the Financial Crimes Enforcement Network for the United States Department of the Treasury will speak for the US Treasury.

Jim McDermott, as author of HR 4976, the Internet Gambling Regulation and Tax Enforcement Act, will be a key figure. His proposal deals with a wide range of taxation issues and is complementary to Barney Frank’s HR 2267, which is designed to legalise and regulate US gambling on a federal level.

Frank’s bi-partisan bill has just signed it’s 69th political sponsor on Capitol Hill in Representative Scott Murphy, a New York Democrat.

McDermott is seeking to impose taxes on online poker and other Internet gambling that could bring the federal government as much as $42 billion over 10 years, according to a congressional analysis. States may collect as much as $30 billion, McDermott’s office estimates.

“It’s a human activity that people are going to do, and it’s a good place to pick up some dough,” said McDermott, a Washington Democrat, in an interview. “I’ve gotten a thousand ideas pumped at me about what we should do with the money.”

McDermott’s proposal would require Internet gambling operators to pay a 2 percent tax to the federal government on betting deposits and a 6 percent tax to states. The federal treasury also would collect taxes on gaming-company profits, and bettors would pay taxes on winnings.

However, arch anti-online gambling opponent, Republican representative Spencer Bachus, says revenue estimates for McDermott’s proposal are bloated because they assume all states would participate. The Alabama congressman said he’s concerned the prospect of more government revenue will attract lawmakers who thus far have opposed legalising Internet gambling.

“I know the government is in a search for money, but if you have something that is destructive to society, you shouldn’t let $40 billion be the price tag,” Bachus said.

The U.S. offshore Internet gambling market is expected to climb to $5.7 billion in 2010 from $5.4 billion last year, according to U.K.-based H2 Gambling Capital, which supplies data on the industry. The global market is about $30 billion.

26 Democrats and 18 Republicans make up the powerful House Ways and Means Committee, which includes familiar names associated with internet gambling like Nevada representative Shelley Berkley.

hi gang people like  Bauhus should go away , they should go with the majority of what people want , ty josie46

US Internet gambling tax bill debate continues....

Strong views remain on both sides of the argument for legalisation

The legalisation of US internet gambling inevitably raised its head in Wednesday’s House Ways and Means Committee hearing on Representative Jim McDermott’s HR 4976 proposal to tax online gaming in the United States.

Congressman Barney Frank, the author of HR2267, a bill seeking to legalise the pastime, spoke passionately about the rights of the player, whilst opponents were equally vociferous in their condemnation and concerns over internet gambling.

John Pappas, Executive Director of the Poker Players Alliance grassroots advocacy group was first off the mark in getting a media release out on the discussions surrounding McDermott’s Internet Gambling Regulation and Tax Enforcement Act of 2010.

"Today's hearing underscores the increasing Congressional interest in a licensed and regulated online gaming environment,” Pappas said in a press statement. “While the robust consumer protections provided by regulation are the biggest selling point, in the current economic environment, additional tax revenue derived from a licensed industry is certainly appealing as well.

"It is important to note that this bill would not levy a new tax on poker players. Rather, it requires each licensed Internet gambling operator to pay a licensing fee – nothing would be deducted from a player's deposit. Individuals would be required to pay annual income taxes on their net winnings, just like players who collect winnings in land-based casinos do today.

"The PPA is working to remove language from the bill that would fine players who play on unlicensed sites as we firmly believe the unlicensed sites should bear the full consequences of not obtaining a license in the U.S.

"We thank the Committee for holding this important hearing today. We look forward to a successful mark up of legislation to license and regulate online gaming in July in the House Financial Services Committee."

According to the Dow Jones news agency, Congressman Frank confirmed that he planned to bring a bill legalising online gambling before his panel in July for lawmakers to consider.

Frank, one of the biggest congressional advocates for overturning the law passed by Republicans in 2006, said he hoped the bill could be approved by the House this year.

The feisty Democrat, who also chairs the powerful House Financial Services Committee, testified before the Ways and Means Committee, arguing that the government has no business telling adults they can't gamble online. He has also noted that the regulations that are set to go into place June 1 would compel banks to determine which financial transactions are illegal under the law.

Frank said that once the regulations are implemented next week, he expected the banks would begin to complain loudly about being told they have to police the online gambling industry.

Turning to his own bill, Frank said that HR 2267 is designed to protect consumers without restricting their freedom.

“I have always believed that it is a mistake to tell adults what to do with their own money.  Some adults will spend their money foolishly, but it is not the purpose of the Federal Government to prevent them legally from doing it,” he said.

“We should ensure that they have appropriate consumer protections and information, but otherwise allow people to pursue activities that they enjoy which do not harm others.  As John Stuart Mill said in his essay, On Liberty in 1869:

“The only freedom which deserves the name is that of pursuing our own good in our own way, so long as we do not attempt to deprive others of theirs, or impede their efforts to obtain it. Each is the proper guardian of his own health, whether bodily, or mental or spiritual. Mankind are greater gainers by suffering each other to live as seems good to themselves, than by compelling each to live as seems good to the rest.”

Frank noted that he had the strong support of some 70 political co-sponsors, including Representative Ron Paul of Texas; and the Ranking Republican and former Chairman of the Homeland Security Committee, Peter King.

He argued that American consumers who wish to gamble online are currently without safeguards against fraud, identity theft, underage and problem gambling and money laundering.  Some operators adhere to rigorous regulatory regimes in foreign jurisdictions, but U.S. customers have no local recourse if they have a problem.

“And, more to the point for today’s hearing, billions of dollars in taxes – both under existing law and those that would be established under Mr. McDermott’s bill – remain uncollected,” Congressman Frank asserted.  “Enacting these bills would bring this industry out of the shadows, benefit consumers and ensure that all of the revenue does not continue to exclusively benefit offshore operators.”

Representative Jim McDermott told the hearing that millions of Americans gamble on the Internet each day, despite laws seeking to prevent or disrupt it. Citing industry analysts, McDermott said US players deposit $12 billion and wager nearly $100 billion annually, generating an estimated $5 billion for offshore operators.

That money would be put to better use in the U.S., he claimed, saying that it could create thousands of jobs for people who would be employed by licensed gambling sites.

"Regulation and taxation have proven to be a better policy for our country when it comes to alcohol," McDermott said. "The same is true for online gambling."

"Driving Internet gambling offshore has been a policy failure,” said McDermott “The GAO has called Internet gambling borderless, and I think it's time for Congress to stop pretending that the future won't come."

McDermott estimated that taxing the industry would generate $42 billion, with the bulk coming from income taxes on winning players. Other revenues would be derived by a tax of 0.25 percent on all wagers, which is consistent with current gambling tax law, and a two percent tax on player deposits at the federal level.

The bill would also give states and tribes the opportunity to share in that deposit tax at a rate of up to six percent on those same deposits in lieu of all other taxes. Combined with existing state income taxes, McDermott estimated states and tribes would raise $30 billion over 10 years.

The Associated Press news agency commented that realistically, supporters realise that Congress is highly unlikely to pass legislation this year on the subject, but they hope to lay the groundwork for the future with hearings like the Ways and Means Committee discussion.

Frank has stressed that his legislation prohibits operators from accepting sports bets as well as bets initiated in states or tribal lands that prohibit that particular type of Internet gambling.

Opponents of the proposed legislation predictably called the hearing a waste of time.

"It's pretty clear to me that Congress is not about to legalise, let alone legalise and tax Internet gambling," said Californian Republican Representative Wally Herger. "There are far more pressing issues we should be focused on."

Another confirmed online gambling opponent, Virginia Republican Representative Bob Goodlatte, told lawmakers that almost all the nation's attorneys general have opposed similar legislation in the past.

"Unfortunately, financial ruin and tragedy are not uncommon among online bettors," Goodlatte alleged.

Democratic Representative Shelley Berkley from Nevada, said online betting has never been more popular, despite efforts to stop it. She said she supports efforts to legalise it, which would allow Nevada casinos to participate in the online market, but she can't support the taxes McDermott proposed.

"Participation in the Internet gambling market by reputable U.S. companies will ensure that U.S. players are able to choose operators based on their integrity and security, and not just their availability," Berkley said.

Fellow Nevadan, Republican Representative Dean Heller, agreed with her position against the tax proposal.

"Common sense regulation of gaming on the Internet will protect American consumers, and I believe it will create at least 32 000 jobs," Berkley said, but then added, "I am unable at this time to support this special tax called for by Mr. McDermott's bill. The issue of taxation and legalization are separate and distinct."

One politician who appeared to have been swayed by the positive arguments for regulation rather than prohibition was the Republican Representative from Oregon, Earl Blumenauer, who after the hearing renounced his stand against online gambling, saying he had learned it was hypocritical, and citing the need for revenue sources.

Blumenauer, who admitted he had voted for the UIGEA when it was rushed through a late night session of Congress attached to a security bill in 2006, said he will now support the regulation of Internet gaming, making him the 70th politician to sign up to Barney Frank’s HR 2267.

In a press statement, Blumenauer said that allowing state lotteries, US horse racing and fantasy sports leagues to conduct gambling business over the Internet made it unreasonable and inequitable to legislate against online casinos and Internet poker.

I found this thread about FullTilt.

It was reported by the Financial Times that the worlds 2nd largest online poker room Full Tilt Poker is being investigated by a federal grand jury in Manhattan, NY.

The article, which was published on Monday April 5 by a Financial Times reporter in San Francisco, read in part, “A federal grand jury in Manhattan is investigating one of the largest internet poker sites serving U.S. gamblers and could bring indictments against some of the world’s best known professional players, according to people familiar with the case and a subpoena issued to a witness this week.” Two poker players singled out are Howard Lederer and Chris Ferguson, whose names were brought to life in a civil suit last year as having an ownership stake in the company.

Federal agents have purportedly honed in on money laundering charges. On their significance, the Financial Times explains, “Money laundering charges might be attractive to the government as they would compel cooperation from authorities even in countries where gambling is legal.” Subpoenas issued in the case allegedly claim that internet gambling is illegal in the United States, a statement many industry insiders would disagree with.

Is this true and if internet gambling is illegal can we get busted and What about PokerStars?

The "player" cannot be busted as far as I can understand.  It is only the financial institutions and "maybe" the site itself that can be in trouble.  As the 2 players named in the article have a financial interest in the site, they are included in the "money laundering" charges.

That is how I understand it.  

Thanks for the post.

blue

Some interesting comments from the

blue

Hey Blue

i found this in Washington Post. Inside Online Poker's Cheating Scandals. Washington Post investigative reporter Gilbert M. Gaul answered questions on Monday, Dec. 1 at 1 p.m. ET about his reporting on Internet gambling, joined by Serge Ravitch, an online poker player and one of the "detectives" in the Absolute Poker scandal.

Richmond, Va.: This is all very interesting, but I thought online betting was illegal. True?

Serge Ravitch: Placing sports bets is illegal as per the Wire Act, but playing online poker is not covered by the Act and is not illegal under federal law. A handful of states (Washington state) do ban it, but it's legal to play in the vast majority of the US.

Also there are other interesting question people where asking. I don't know why i can't link this page but its Washington Post. Knowing u  u know the answers to those question already.

Blue

The date was Dec 1,2008 from the Washington Post

1st June 2010 marks the date upon which financial institutions are now legally responsible to comply with the UIGEA.

I'm seeing loads of comments on the internet like "blip on the screen", "bump in the road" and *hiccup".

I also see these comments from the PPA - "The UIGEA does not make online poker illegal“  "The UIGEA does not criminalize any new forms of internet gambling, something the U.S. third circuit court of appeals made explicit in its ruling last year." "No American has ever been charged for playing online poker."

It seems the UIGEA is only intended to affect deposits and not withdrawals from online gambling sites.  I expect you will find longer deposit times as well as withdrawals taking longer too. 

EWallets seem to be the way forward I would say from all the information I have read.  Putting money into an ewallet cannot be seen to be illegal as you can spend the money in your ewallet on other goods apart from gambling.

Hi kynettie,

In response to your post - I looked at the Washington Post and it says I have to register to read any articles.  I certainly will register later on and come back to you.

blue

FROM THE NEWS SECTION

Is this the first step toward regulated online gambling in a US state?

In what could prove to be an important breakthrough in US intrastate online gambling regulation, New Jersey state senators Thursday released a bill from committee that would allow casinos to build online websites for poker,blackjack and other games.

Members of the Internet-gaming business lobby hailed the legislation as a significant step forward for New Jersey to establish itself as the first state to allow full Internet gaming within its state jurisdiction.

The day started with the state’s Senate Wagering and Tourism committee hearing testimony on a bill that would allow online betting on poker and casino games. Legislators were told that allowing embattled Atlantic City land casino operators to create online sites would provide at least $200 million in additional state revenue and bring an estimated 1 500 high-tech jobs to south Jersey.

However, opponents, mainly from the horse racing industry which already has federal exemptions to operate online wagering, said that New Jersey's battered horse racing industry would take another hit if forced to compete with online wagering from the casinos.

Horseracing supporters were also less than pleased when senators removed a provision to allow "gaming rooms" at racetrack venues where customers could get online to gamble.

Cash strapped US states – especially Florida and California - are showing growing interest in the possibilities of regulated internet gambling, citing the autonomy of individual states that allows them to decide on intrastate

issues.

Under the bill discussed at the hearing, New Jersey would allow an intrastate online gambling network, relying on high-tech online software to allow customers within New Jersey's borders to access the land casino-run online websites.

At the close of the hearing, Senators on the committee approved the bill by 3 votes to 1.

The bill's sponsor, Democratic Senator Ray Lesniak, argues that federal law has given New Jersey a window to try an intrastate approach to developing an online-gaming business model.

Representatives of the Interactive Media Entertainment and Gaming Association, which supports the proposal, said the bill could bring between $210 million and $250 million in annual gross gaming yield to casinos and between $47 million and $55 million in new state revenues. Still greater revenues could be created if New Jersey succeeds in attracting Internet gaming companies to headquarter in the state.

"The state would benefit by being a 'first mover,'" said iMega chairman Joe Brennan Jr. The existing casino industry, combined with the space and workforce available around Atlantic City to create centers of technical support and data storage to the new industry, all within reach of Wall Street investment firms, give the city a strategic advantage over other states, he pointed out.

"New Jersey will be able to position itself as the national and potential global capital of the next gaming industry," he added.

115 hour marathon poker session sets a new benchmark

Poker pro Phil 'Unabomber' Laak (37) has successfully completed his attempt on the world record for continuous poker play, convincingly breaking all previous records with a hard-to-beat 115 hour benchmark.

His well documented success will be sent to the Guinness Book of Records for official recognition, he announced after ending the initiative Monday.

Laak started playing at 12:04pm on June 2 in the Bellagio Poker Room in Las Vegas, and broke the world record by 36 hours and 15 minutes when he stopped at 7:04am on June 7.

"I was shooting for 80 hours all along and eventually it came," said Laak. "It was loads of fun and of course impossible without my crew. This has been one of the most wonderful journeys I've ever taken, touchingly human and beautiful on so many levels. Thanks to everyone who shared in this amazing ride."

Laak used the record-breaking attempt to raise money for Camp Sunshine, an organisation that supports children with life-threatening illnesses and their immediate families through various stages of illness. Unabomber donated half of his winnings and raised additional funds by selling several of his signature hooded sweatshirts, along with numerous tee shirts worn during the record setting game, for up to $500 each. He also won a 58th hour challenge to do 30 pushups for a $1,000 donation to the charity. Additionally, fans were able to donate $10 to the camp by texting.

Many of Laak's poker pro friends and peers came to play with him or offer support. In addition to his longtime girlfriend, actress and poker pro, Jennifer Tilly, other pros who stopped by included Scotty Nguyen, Prahlad Freidman, James Mitchell, Rod Fani, Eric Liu, Huck Seed, David Wells, Mike Matusow and Jean-Robert Bellande.

The record setting game was a thoroughly modern affair that included Laak tweeting throughout to give updates to his followers, and an ongoing web video stream of his game that was viewed in 120 countries by over 177,000 people. The Unabomber Poker Blog has plenty of coverage of the event as well as a Picture Gallery composed of images from the entire challenge.

A support team comprised of Susan von Seggern, Jeff Bass, John Srednicki, Ace Jones, Jennifer Tilly and Wolf Rosenberg rotated in shifts to ensure that the proper Guinness documentation requirements were met at all stages, and that Laak was properly nourished with appropriate foods.

He was served small meals every five hours by nutritionist, "All American Dave," who kept the player's blood sugar at a consistent level with a diet of fresh fruit and vegetables, lean chicken and fish and sweet potatoes.

Laak pulled the plug after 115 hours, nearly two days longer than the official world record of 72 hours and 2 minutes held by Larry Olmsted. Last September, Paul Zimbler overtook the Olstead record (see previous InfoPowa report) by playing for 78 hours and 45 minutes, but it was not sanctioned by Guinness World Records.

PPA Announces Fundraising “Money Bomb” on July 1st

Building on the momentum of the past year, the Poker Players Alliance announced this week that it will drop a fundraising "money bomb" on July 1st in order to raise additional funds leading up to a crucial vote this summer on legislation to license and regulate online poker.

A money bomb is when an organisation asks all of its members and supporters to make a financial donation – of any amount – to the group on one specific day. The PPA hopes to raise $25,000 from its over one million members throughout the United States.

"We would not be where we are today without the support and dedication of the poker community. Yet, there is much more to be done to assure that every American has the right to enjoy a game of poker from their computer, in a casino or at their kitchen table," said Alfonse D'Amato, chairman of the PPA.

"This unique fundraising effort is another way for our members and all players to demonstrate to lawmakers the broad support for online poker, while at the same time helping PPA continues its advocacy efforts."

As a reminder to donate on July 1st, players can visit www.pokermoneybomb.com to download the event to their calendars. Even if individuals are not members of the PPA, they are able to donate for this drive and will not be required to become a member.

South Carolina's Supreme Court will hopefully produce a sensible ruling on a long-running issue

Four years ago the police in the South Carolina town of Mount Pleasant busted a group of residents playing poker in a private home. Whilst many of those arrested took the easy way out and pleaded guilty, five took exception to the raid and hired lawyers to defend them in court, claiming that poker did not fall within the definition of illegal gambling because it was a game in which skill predominated, not chance.

They lost the first round in a local city court, but lodged an appeal which saw the case appear on the rolls of a South Carolina Circuit Court, where Judge Markley Dennis lifted the spirits of poker players by ruling, after hearing extensive academic and other evidence, that Texas Hold'Em was primarily a game of skill.

However, the state of South Carolina did not rest there, with Attorney General Henry McMaster taking the issue directly to the South Carolina Supreme Court on the grounds that the case had become a constitutional matter.

The court will hear the case later this year at a date yet to be decided, but the defiant poker players will again put forward their arguments, and legal representative Jeffrey Phillips believes there is a good chance that the matter will be settled in their favour and once and for all.

Adding to the capabilities of the defendants is the Poker Players Alliance, which is supplying legal assistance and advice, raising comparisons with games like chess, tennis and golf.

The case is important not only because it has the potential to remove the game from the risk of prosecution for 'illegal gambling', but because a favourable ruling could become a positive element in efforts within the state to pass legislation regulating and therefore formally legalising the game.

“The South Carolina case is not a direct corollary to our efforts in Congress,” says PPA execvutive director John Pappas. “It’s just part of our mission. We believe a rising tide lifts all boats, and a victory in South Carolina would help us make the point that poker is a game of skill – on the internet and elsewhere."

The Economist opines that bans will not work, and it is better to legalise, tax and regulate a popular pastime

The respected UK business and economics publication 'The Economist' criticised attempts in other countries to ban online gambling this week in a leader article pointing out the advantages of properly licensed and regulated internet gambling activity.

Noting that history has shown that prohibition of a popular pastime - the alcohol bans in the United States for example - rarely works, the article goes on to examine the difficulties faced in enforcing the Unlawful Internet Gambling Enforcement Act in the United States, and the workarounds that have developed to overcome government attempts to disrupt financial flows to so-called 'illegal' internet gambling websites.

"...after a brief dip, Americans are now betting online about as much as they did four years ago. The Justice Department still maintains that online gambling is illegal, yet large numbers of Americans carry on regardless. The reason is simple: anyone who wants to gamble and has an internet connection can do so," The Economist points out, illustrating its point with some statistical facts.

The piece discusses the motivation of those seeking to kill off this modern evolution of gambling, opining that commercial protectionism and a fear of competition is a real element. It also poses the question of whether punters are better protected by banning the pastime and driving it underground, as is happening in the United States, or properly regulating and taxing it as is done by more enlightened governments such as the United Kingdom and a growing number of European states.

Online poker is particularly singled out as an example of a gambling genre that, thanks to modern media coverage, has grown from 'a niche game with a rather louche reputation' to a booming one, rightfully respected for the mental agility and improvisation it requires.”

Read the full article at http://www.economist.com/node/16539402

CHEATING CHINESE REPORTED AT POKERSTARS

Members of collusion ring could have profited by up to $750 000…but no longer.

Discussions on the popular poker message board 2plus2 reveal that a large scale collusion ring involving several dozen Chinese players, who profited by as much as $750 000 on the PokerStars.com website, has been uncovered.

Initial reports indicate that PokerStars moved quickly to deal the cheaters out, and has already agreed to reimburse players impacted by the fraud to the tune of $587,000.

The ring apparently operated on $108 Double or Nothing sit and go tournaments, starting last summer but being unmasked as early as February this year.

One of the fraudsters, using the nickname Jane0123 brought the issue into the limelight when he whined on the 2+2 forum that his PokerStars account containing winnings of $10 000 had been frozen by the operator.

In the storm of responses that followed it was alleged that the poster had been a member of the ring who had been reported by other players to PokerStars, and that relevant Sharkscope data showed that Jane0123 had played 11,766 Double or Nothing tourneys with an average stake of $87 and had achieved a profit of $56,300.

Other big players from the Double or Nothing leaderboard at PokerStars were also accused, including one ‘Wudiya’ who made around $96 000 on the DoN games last year.

2+2 revelations include the claim that often half of the players in any given game have been part of the ring, most of them coming from the Chinese town of Hangzhou.

The cheaters may have generated up to $600,000 as rake to PokerStars, some posters claim. While users on 2+2 admit that DoN's are an easy target for colluders and such collusion can be difficult to detect, others say that the cheating happened on such a scale and duration that PokerStars' security should have put their sensors up much sooner.

Investigations continue, but many suspect that so is the cheating, this time possibly by another group of Chinese players who recently joined from the Wenzhou area in China.

Any player suspecting that they have been affected by collusion should contact PokerStars at email address gamesecurity@pokerstars.com.

Read the full story at http://www.coinflip.com/news/collusion-scandal-pokerstars-don-sit-gos.html

Is the next stage of a US attempt to legalise online gambling about to start?

The on-again, off-again HR2267 Internet Gambling Regulation, Consumer Protection, and Enforcement Act authored by Congressman Barney Frank and supported by almost 70 so-sponsors (see previous InfoPowa reports) may be back centre-stage soon, according to the Poker Players Alliance, a US players association with over a million members that is active on the American political scene.

According to PPA officials at the 41st World Series of Poker currently taking place in Las Vegas, the proposal could be marked up as early as next week, presumably in the House Financial Services Committee, which Congressman Frank chairs.

The bill was introduced in the House last May, but has been delayed by the volume of other financial work in the committee, and probably by careful tactical timing by the Congress-smart Frank.

The PPA recently raised an additional $27 000 for its campaigning through a widespread appeal, or 'money bomb' to its 1.2 million members (see previous InfoPowa reports).  The cash will be used to fund political publication advertising targeted on Washington politicians.

Frank continues to play his cards close to his chest, with PPA executive director John Pappas telling an ESPN interviewer at WSOP that the politician has hinted that a mark-up may be imminent.

The last hearing on HR2267 was in the Financial Services Committee last December when the usual for and against arguments were offered. At that time the senior (and anti-online gambling) Republican representative, Spencer Bachus, protested at the absence of officials from the US Treasury and the Federal Reserve - two key federal government departments involved in the much-delayed drafting of the regulations supporting the UIGEA, which were implemented on 1st June this year..

UIGEA enforcement mechanisms are flawed, says Shelley Berkely in political assessment

Shelley Berkely, the feisty Nevada Democrat who supports properly regulated and controlled online gambling in the United States, came out strongly against the recently implemented Unlawful Internet Gambling Enforcement Act this week in a major feature article in the Washington DC political publication Roll Call.

Berklely says that Nevada is famous for its skill and experience in effective gambling regulations, and for keeping pace with technological and other dynamics impacting the gambling industry. The state is expert at turning these to best advantage to ensure that enforcement is effective, and that players are assured of getting a fair bet, the house is protected against cheating and money laundering and other crimes are controlled.

She points out however, that the current prohibitionary approach to Internet gambling in the United States has resulted in an environment where instead of being protected by regulations designed to prevent rip-offs, fraud and identity theft, Americans are being left vulnerable as a result of the moralistic UIGEA.

“This failed legislation sought to pin a cyber “tin star” to the chest of the financial industry with the idea that these companies would become the new “virtual sheriff” in town and that together, they would prevent anyone under U.S. law from taking part in any illegal online gaming,” Berkely writes.

“In reality, countless Americans logged on to their computers June 1 — the day the act took effect — and placed bets over the Internet. In the time it takes to read this sentence, thousands of players from Alaska to Hawaii and across the rest of the U.S. will have participated in some form of online wagering. And these men and women will keep right on playing, knowing that the law doesn’t even make clear what is illegal gambling and what is not when it comes to the Internet.”

Berkely goes on to compare the bans on internet gambling financial transactions with American failed historical attempts to prohibit the consumption and trading of alcohol, saying that the law actually helps the bad guys instead of protecting Americans against criminals.

She asserts that prohibition as a policy is doomed to fail and it’s time to start over.

“I firmly believe adults have the right to choose how they spend their leisure time and money, and that includes the ability to participate in Internet gaming from the privacy of their own homes and computers,” Berkely continues.

“That is why I vehemently opposed the UIGEA when it came before Congress and why I continue to support the efforts of House Financial Services Chairman Barney Frank (D-Mass.) — and others — to replace what would be better called the Unworkable Internet Gambling Enforcement Act.”

Berkely points to what she refers to as the “fatally flawed enforcement mechanism” of the UIGEA, which places the burden of deciding which transactions are illegal on the shoulders of an inexperienced and overworked financial services industry. Exacerbating the situation is the fact that the Act is imprecise and does not clearly define what is regarded as an illegal gambling transaction – something financial institutions have been cautioning the government on for some time.

And she stresses there was never a penalty intended against those placing the bet, only against the banks now tasked with policing customers to stop any and all cyberbets.

Berkely suggests that the way forward is to tap into the expertise developed by Nevada’s world-class gaming regulators, and those in other states, which would enable the development of a new framework that would give adults the right to choose for themselves to visit a virtual casino or play in an online poker game with competitors drawn from around the planet.

“Every day the U.S. fails to act, we are also missing out on new business opportunities that could flow to legally authorized American operators of regulated Internet gaming ventures,” she warns.

“In addition, technology has dramatically improved identity verification and enhanced other protections designed to prevent those who are underage from doing on the Internet what they could not do in person during a visit to any resort casino on the Las Vegas Strip,” she adds.

“It’s time to let the UIGEA ride off into the sunset and to replace the virtual Wild, Wild West it has created with workable regulations designed to protect American adults — in numbers that only continue to grow — when they choose to place a bet over the Internet.”

Read the full article here: http://www.rollcall.com/features/Technology_Telecommunications/tandt/48164-1.html

HR2267 will again be front-and-centre on July 21st

The PPA's heads up earlier this week that Congressman Barney Frank's bill to legalise online gambling in the US is due for another hearing has turned out to be right on the mark.  The House Financial Services Committee chaired by Frank has confirmed that HR2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, will again be debated on July 21st.

Less time has been allocated to the hearing than was the case last December, with the current debate starting only after lunch at 13h00 in Washington DC. A committee spokesman said that the anticipated mark-up of the new legislation would not on this occasion take place,

The PPA issued a statement on the hearing, in which executive director John Pappas said: “We appreciate Chairman Frank calling another hearing on HR 2267. We hope this is the final step toward an eventual vote in his committee on this legislation before the August recess. The PPA and the poker community stand ready to secure its passage.”

The Interactive Media Entertainment and Gaming Association (iMEGA) is also interested in the proceedings, with chairman Joe Brennan noting that whilst hearings were useful in keeping attention on the subject, what is really needed is political progress in the shape of committee and floor votes.

"The i-gaming lobby has been working too hard for too long. It deserves more than a hearing," said Brennan. "But, we’ll wait and see who will appear as witnesses. I’d like to see John Pappas finally get the opportunity to appear before the House Financial Services Committee and make the case for the players.”

The Committee has not yet issued its witness list.

Poker pros and politicians to appear before House Financial Services Committee

Today’s (Wednesday) House Financial Services Committee hearing on Congressman Barney Frank’s HR2267 bid to legalise online gambling in the US (see previous InfoPowa reports) will feature poker professionals and politicians on its witness list.

It has already been announced that the hearing is not intended at this stage to mark-up the bill, but to hear further evidence on the topic, which is described on the Committee’s website as: “At its most basic level, the issue before this committee is personal freedom – the right of individual Americans to do what they want in the privacy of their homes without the intrusion of the government.”

The committee has published a list of witnesses that includes respected professional poker player and high profile television personality Annie Duke, who will speak for the Poker Players Alliance, claiming: “To be clear, HR 2267 is not a bill that expands Internet gambling in America. It simply provides the appropriate government safeguards to an industry that currently exists and continues to grow.”

Speaking for the Credit Union National Association will be Edward Williams, President and Chief Executive Officer of the Discovery Federal Credit Union, whilst Tom Malkasian, Vice Chairman and Director of Strategic Planning for the Commerce Casino, will speak for his employers. The Commerce Casino is involved with the Morongo Band of Mission Indians in seeking the intrastate legalisation of online poker in California (see previous InfoPowa reports).

The Mohegan Tribe’s Lynn Malerba and law enforcement and anti-terrorism consultant Michael Fagan will also be appearing before the 71 member Committee, but noticeable by their absence are representatives for the United States Treasury and for the Federal Reserve. This is likely to evoke criticism, as at the last hearing on the bill in December, Republican opponents of the proposal called for officials from these government departments to be present at a follow-up hearing.

HR2267 has so far attracted 69 co-sponsors, but timelines for a vote are shrinking as Congress is scheduled to adjourn for the year on October 8th, with a recess planned between August 9th and September 10th. Politicians will also be distracted by the mid-term elections, which take place in November.

Little that is new surfaces in House Financial Services Committee statements.

Wednesday's House Financial Services Committee hearing on Congressman Barney Frank's HR2267 Internet Gambling Regulation, Consumer Protection and Enforcement Act produced valid points in favour of legalising online gambling in the United States, but little in the way of new opinions not already aired in previous such gatherings.

Committee members heard testimony from representatives of the financial services, tribal and poker communities who spoke in support of regulating Internet gambling, and dyed-in-the-wool opponents like Republican Representative Spencer Bachus warned against addiction and the corruption of youth.

Ed Williams, a director of the Credit Union National Association (CUNA) spoke of the challenges faced by financial services companies who are forced to comply with burdensome and imprecise rules in an attempt to prevent unlawful Internet gambling transactions. Williams testified that H.R. 2267 would promote "…regulatory simplicity while assisting financial institutions compliance with UIGEA."

Lynn Malerba, tribal chairwoman of the Mohegan Tribe discussed the role tribes engaged in the gaming industry play in Internet gaming and praised chairman Frank for the great respect he has shown "…for tribal sovereignty by actively seeking the input of tribes" to ensure their fair treatment under the legislation.

Professional poker player Annie Duke testified about the consumer safeguards and revenue potential under H.R. 2267, maintaining that American poker players "…want to play on sites licensed in the United States, which will provide for even greater consumer protections for the player and yield badly-needed tax revenue for state and federal governments."

Duke represented the views of the million-plus membership of the Poker Players Alliance, and noted that 70 million Americans play poker, saying: "This Committee and this Congress should not tolerate laws that seek to prevent responsible adults from playing a game we find stimulating, challenging and entertaining.

"HR 2267 provides this freedom in a safe and regulated environment and I urge everyone on this Committee to support this common sense policy. However you might feel about gambling on the Internet, I would suggest that gambling with freedom is far more risky," she said.

PPA executive director John Pappas said: "The testimony we heard today underscores the challenges faced by the Federal government due to the unclear definition of what now constitutes unlawful Internet gambling, and the glaring lack of protections for consumers.

"Frankly, our opponents can't offer a consistent argument on this issue. Former U.S. Attorney Michael Fagan wants to go as far as banning Internet gambling outright, and Tom Malkasian of Commerce Casino supports licensing and regulation - just not in a competitive marketplace. It seems that our opponents don't even agree with each other here," he added.

Perhaps the main purpose for the hearing was to re-engage the interest of law makers prior to a move to vote (see following story on a possible mark-up of HR2267 in preparation for a vote).

Internet gambling regulation has been the subject of several previous congressional hearings. Most recently, in May 2010, the House Ways and Means Committee held a hearing to discuss the Internet Gambling Regulation and Tax Enforcement Act of 2010 (H.R. 4976), a companion piece of legislation to the Frank bill introduced by Rep. Jim McDermott that would ensure the collection of license fees and taxes on regulated Internet gambling activities.

According to a tax revenue analysis conducted by the Joint Committee on Taxation, regulated Internet gambling is expected to generate nearly $42 billion in revenue for the federal government over its first 10 years. Estimates suggest that it would also generate as much as $30 billion in new revenues to the states.

Chairman Frank's legislation reinforces the rights of each state to determine whether or not to allow Internet gambling activity for people accessing the Internet within the state and to apply other restrictions on the activity as determined necessary.

Since its introduction in May 2009, a bi-partisan group of 69 co-sponsors has signed onto the legislation. A recent analysis by H2 Gambling Capital predicts that Internet gambling regulation would create up to 32,000 jobs over its first five years.

July 27 date scheduled

The House Financial Services Committee announced late Thursday that HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, will be marked-up on Tuesday, July 27th.

The Safe and Secure Internet Gambling Initiative (SSIGI)'s spokesman Michael Waxman commented: “Chairman Frank is clearly moving to get his bill advanced before Congress leaves town for their summer recess. Most importantly, the markup shows a commitment by chairman Frank to move forward and his colleagues to address this issue.”

Tuesday will be a busy day for the Committee; besides HR2267 there are five other bills on the agenda for discussion, including HR 5814 (Public Housing Reinvestment and Tenant Protection Act), HR 4868 (Housing Preservation and Tenant Protection Act), HR 3421 (Medical Debt Relief Act), HR 4790 (Shareholder Protection Act), and HR 5823 (United States Covered Bond Act).

This is the first set of mark-ups to be placed on the Committee’s agenda since May.

Heavy agenda and long lunch delay HR 2267 vote

Industry observers expecting a vote on the mark-up of Barney Frank's proposal to legalise US online gambling Tuesday (see previous InfoPowa reports) were disappointed to learn that a heavy business agenda and lunch break delays curtailed the House Financial Services Committee deliberations before HR2267 was reached.

However, the bill is first up for debate Wednesday July 28 when the Committee reconvenes.

HR 2267 - the Internet Gambling Regulation, Consumer Protection, and Enforcement Act - is the third of seven bills before the Committee and has been submitted for mark up following a second Congressional hearing last week (see previous InfoPowa report).

Observers expect the mark up debate to centre on precautions against underage and problem gambling and the exclusion of organised crime; states' jealously guarded rights and the manner in which licenses will be handled.

Much of Tuesday's Committee activity was taken up by just two other bills that preceded HR2267 on the agenda, and the slow progress was then reportedly exacerbated by the members of the committee taking a three hour lunch break before returning to complete deliberations on HR 4868 the Housing Preservation and Tenant Protection Act of 2010, which was allowed to progress further.

It's amazing how long this thing is getting dragged on.  I'll still be following this news, though.

It's amazing how long this thing is getting dragged on.  I'll still be following this news, though.

They are certainly dragging it out. 

blue

HOUSE COMMITTEE APPROVE BARNEYS BILL

There's still a long road ahead, but the first hurdle has been cleared

Wednesday's delayed vote on Barney Frank's HR2267 bill seeking to legalise online gambling in the United States proved to be worth the wait, with members of the House Financial Services Committee voting it forward by 41 to 22 in a bipartisan approach. The vote was taken after a number of amendments were accepted.

“My primary goal is Americans ought to be free to do what they wish without this kind of intrusion,” said Frank, referring to the UIGEA which was implemented on June 1 2010 to disrupt financial transactions with online gambling companies. “The intrusive regulation is a problem for the financial institutions," he added.

A separate measure authored by Rep. Jim McDermott that depends on the full House approval of Frank’s plan would impose taxes on online poker and other Internet gambling, bringing the federal government as much as $42 billion over 10 years, according to an independent congressional analysis.

McDermott’s proposal would require Internet gambling operators to pay a 2 percent tax to the federal government on betting deposits and a 6 percent tax to states. The federal treasury also would collect taxes on gaming-company profits, and bettors would pay taxes on winnings.

Opponents of HR2267 included - as usual - Representative Spencer Bachus of Alabama, the top Republican on the Financial Services Committee, who claimed that legalising online gambling would harm society and that Congress has more pressing issues to tackle.

In a rather exaggerated statement that takes little cognisance of extensive measures against underage and problem gambling, Bachus alleged: “With this bill, in one broad stroke, we will allow every child in America to gamble on their home computer or in their dorm room.”

Before passing the bill, the committee insisted on amendments that prohibit operators that have violated U.S. laws from getting licenses (suggested by Rep. Bachus); a statistical record proposal; and one to ensure that online betting on sports such as football isn’t allowed.

The panel also approved amendments to help prevent minors from gambling online and prohibit marketing that targets youth.

Using credit cards to bet will not be allowed, although debit cards are acceptable.

Another addition was a provision that those behind on child support payments will be blocked from regulated online gambling sites by the operators.

At one point the sensitive issue of tribal gambling interests was raised, with Rep. Gary Peters of Michigan suggesting an amendment to exempt state and tribal lotteries from having to be licensed by the Federal government. This was passed on the grounds that these entities are already licensed by individual states.

One California Democrat, Brad Sherman, said: “I have opposed this bill for years, but I am slowly changing. The best reason for this bill is the prospect for revenue.”

HR2267 had already attracted some 69 bi-partisan co-sponsors prior to Wednesday's vote.

John Pappas, executive director of the Poker Players Alliance, a pressure group with over a million US members, said that the bipartisan nature of Wednesday's vote adds momentum to the legislation. The focus now shifts to the legislation to tax the betting, which is before the House Ways and Means Committee, he said.

Pappas noted that in addition to Frank's wider proposal in the House of Representatives, a bill focusing on internet poker had been launched by Senator Robert Menendez in the Senate, and this could be useful should the Senate find Frank's bill too broad to accept. 

Bloombergs business news service reports that the U.S. Internet gambling market is expected to climb to $5.7 billion in 2010 from $5.4 billion last year, according to U.K.-based H2 Gambling Capital. If the U.S. legalises online gambling, the market could grow to $24 billion in five years, according to H2. That excludes most sports betting, which wouldn’t be allowed under Frank's proposals to the House.

The global market now is about $30 billion, H2 estimates.

The passage out of committee of HR 2267 has already excited wide mainstream media coverage, especially the amendment that seeks to prohibit the issue of US licenses to offshore companies that continued to operate in the United States after the passage of the UIGEA in 2006.

Industry observers and analysts point specifically to very large online poker entities like Full Tilt Poker and Pokerstars as possible victims of this clause. Many large groups exited the US market in the wake of UIGEA, and others have negotiated their positions with the US Justice Department.

HR2267 places heavy emphasis on operator measures to prevent underage, problem or criminally influenced gambling, along with assurances that the autonomy of individual states will be respected and internet betting in states that prohibit it will be blocked.

The chairman of the PPA, former Senator Alphonse D'Amato said in a statement after the Frank Bill was approved: “The fact is, online poker is not going away. Congress has a choice – it can license and regulate it to provide government oversight and consumer protections, or our lawmakers can stick their heads in the sand, ignore it, and leave consumers to play on non-U.S. regulated websites in all 50 states.

“I’m glad the Financial Services Committee today overwhelmingly chose to act and protect Americans as well as preserve the fundamental freedoms of adults and the Internet. This is a great day not only for poker players, but for proponents of Internet freedom and individual liberty.

“We thank Chairman Frank for his leadership on this bill, and look forward to working with him to bring this bill through the legislative process.”

Key provisions of HR 2267 include:

* Thorough vetting of potential licensees and the creation of an OFAC-style list of illegal operators;

* Mandatory implementation of technologies to protect against underage gambling using the commercial and government databases used for online banking to verify age and identity

* Requirements for operators to set daily, weekly or monthly limits on deposits and losses to monitor and detect individuals with excessive gaming habits;

* High standards to thwart fraud, abuse and cheating to ensure fair games for customers;

* Regulation to prevent money laundering; and,

* Processes to prevent tax avoidance.

Thank you bingocrazy  - I was wondering when someone would "get" how big this last story was.

blue

Definately a step forward!!!Thanks for keeping us up to date on all the latest info!!Maybe I'll go in search of my poker chips that I stashed away and invite some friends over to play.I need to refresh my poker skills!!! :P :P

Online gambling group has a solution for US market entry

Speaking to journalists in a post-financial results conference Friday, Party Gaming CEO Jim Ryan addressed the question of obstacles to his company's re-entry to the US market, assuming that market is legalised.

The main hurdle - a multi-million dollar settlement with the US Department of Justice over pre-UIGEA activity - has already been overcome but the status of founders and significant shareholders Russ De Leon and Ruth Parasol has been raised in the wake of the merger agreement between Party Gaming and Bwin last week.

The husband and wife team that founded Party Gaming with IT whiz Dikshit Anurag has not followed in Anurag's footsteps in admitting guilt and paying a large fine for alleged US illegal activity.

Ryan pointed out that the company has reached agreement with the duo in the event that their stance presents a problem to the company in regard to re-entering the United States market. He noted that the merger agreement with Bwin had included a provision that if a shareholder presented a problem regarding a licensing application, the company could require that shareholder to liquidate their equity in the company.

“There have always been questions about Party Gaming and our position in this regard," said Ryan. "But we have now closed the loop and I think we are very well positioned."

Ryan went on to sound an optimistic note on the future of the online US gambling market, noting that legislative moves were looking promising, and pointing to the advantages that a legalised market could bring to US tax coffers, land-based gambling groups, the players themselves and online gambling groups that were able to meet the regulatory requirements that will be imposed if the market is legalised.

He noted catalysts for change in the US such as the efforts of Harrah's and GTech, whose pursuit of the possibility of a legalised market has spurred other land entities to explore possible routes to online action and partnerships that could prove useful. He also observed that Party Gaming's acquisition of the World Poker Tour has led to negotiations with a significant number of US land corporates on running WPT events, opening doors for wider discussions on US market opportunities.

Nevada reps support HR2267

But which way will Harry Reid jump?

The Reno Gazette-Journal commented over the weekend on federal attempts to legalise online gambling in the United States, noting that three Nevada representatives in the House of Assembly support Congressman Barney Frank's HR2267...but that the support of Senate Majority Leader Harry Reid will be critical.

That support may not be immediately forthcoming; the crafty leader of the Democrat majority has thus far not committed himself either for or against the proposal.

Describing his involvement as pivotal, Democrat and Nevada Representative Shelley Berkley told the newspaper: "He will be the decider when it comes to Internet gaming."

Frank's HR2267 passed out of the House Financial Services Committee last week on a 41 - 22 vote of approval and has 70 co-sponsors in the House - the strongest showing yet in attempts to legalise the pastime in America.

Independent assessments have shown that a legalised online industry could be safer for American players, create employment opportunities and generate $42 billion in tax revenues over the next decade.

The Reno Gazette-Journal notes that most Nevada land casino operators have historically opposed online gambling as a possible competitive threat to their businesses, although in recent years the American Gaming Association has adopted a neutral position. However, the newspaper points out, HR2267 may clear a path for Nevada gambling companies to profit from digital gaming because they did not violate attempts to kill off internet gambling through the 2006 UIGEA, which bans financial transactions with online gambling companies.

Major potential competitors already occupying the online space that have persisted in offering internet gambling to Americans since 2006 may be precluded from obtaining US licenses if HR2267 is successful, the publication notes.

One example of a US company that could benefit is Harrah's Entertainment, whose interactive division owns the World Series of Poker, already has online ventures operating elsewhere, and backs the bill.

Congressman Reid voted for the UIGEA in 2006, but Berkley opined he may vote for legalisation.

"I think his position has softened dramatically, but he's going to need to be convinced," she said. "I don't want to put words in his mouth, but I know he's been moving to a positive position."

Berkley and fellow Democrat Representative Dina Titus are both among the co-sponsors of the Frank bill.

Republican Nevada Representative Dean Heller appears in favour of a legalised industry, writing in a statement last week: "Current law banning Internet gaming is unworkable and needs to be addressed. However, a lot of questions remain on how to appropriately legalise Internet gaming. The passage of this bill is a positive first step in moving the debate forward, but more work needs to be done to fully resolve this issue."

Dennis Neilander, chairman of the Nevada Gaming Control Board said that Nevada laws are already in place to regulate online gaming, and noted that if the federal government gives states the green light, the board will have to ensure online casinos can effectively exclude minors.

"We would have to see from a technology point of view that it could be done in such a way that would prevent minors from taking part and that you would have to be able to block people from wagering from jurisdictions that make it illegal," he said.

Another question is how to tax and regulate online gaming. Nevada lawmakers and gaming officials are adamant about keeping the oversight and taxation of gaming under the supervision of individual states.

"Gaming has always been something the states can decide if they want at all, and if they want it, how much they will tax it," Neilander said. He added that the nature of the Internet means Congress will need to be involved in some limited way.

"This is sort of a unique animal," Neilander said. "The Internet is such a mechanism for interstate commerce that I'm sure there will have to be some federal regulation."

Ok so in a nutshell..when can we basically start signing up for new microgaming accounts lol?

Really though..when or when is it predicted?

Fingers,toes and every other body part I can cross are crossed. ;D Damn now I got a charliehorse!!!  :o ;D Thanks blue for keeping us informed! :-*