A bill to legalize intrastate online gambling and regulation through the Division of Pari-mutuel Wagering was presented to the Florida legislature on Friday. The bill called the Internet Poker Consumer Protection and Revenue Generation Act of 2010 was authored by state representative Joseph Abruzzo.
The bill calls for the creation of a position known as Internet hub operator, which would administer online poker rooms connecting players in Florida. It would require players to register accounts at affiliated card rooms, which would then in turn be responsible for providing patrons to the Internet gaming operator. The operator has a $500,000 licensing fee and each affiliate pays $1,000 for a license. Gross earnings are taxed 20% by the state.
No luck for overseas online casinos as applicants must be incorporated in the state of Florida. But, there may be more than one hub operator. Provisions include an age check, identity check, self-exclusion option and guard against money-laundering at the time of account funding. Abruzzo said one million Floridians participate at unregulated offshore sites and the bill would generate over $200 million for the state in its first year.
This comes after news broke of a German citizen living in Naples, Florida who violated money-laundering laws in processing payments to Internet poker players. Michael Olaf Schuett is being held for dealing with millions in money transfers to pay online gambling winners in the U.S. Employees at local banks and FedEx tipped off authorities. Schuett was shipping more than 50 packages with checks per day from his house. Schuett may be in for a first-class felony charge because he didn’t register with Florida’s Bureau of Financial Investigations as a money transmissions operator.
Iowa lawmakers are taking the bull by the horns in the push for the federal regulation of online gambling. State Representative Doug Struyk is part of a committee examining intrastate Internet gaming and said that the time is now for Iowa to act and be the forerunner for online gambling.
Struyk spoke at a forum on gambling issues sponsored by IowaPolitics.com. He said that Internet betting fully exists with reports of 50,000 Iowans involved in overseas Internet casinos and online poker rooms. In other words, a state like Iowa with 17 casinos providing easy local access still has 2 of every 100 residents choosing to gamble online. Revenue is the main argument for regulation but Struyk also said regulation is necessary to protect Iowa’s consumers. Poker players have voiced their concerns about companies being accused of using fake player accounts to post huge bluff and back patrons out of heavy pots.
The Iowa legislature is developing a plan that would perform age checks and identification verification for licensed casinos. Approved players would have free reign to play at any of the state’s Internet gaming sites. Struyk is hoping for states to form networks that would allow players to compete against players from other states. The Iowa sites would be regulated through the Iowa Racing and Gaming Commission. Struyk is making the same argument for sports betting, pushing for regulation that would tax existing activity and protect citizens since the ban on sports wagering hasn’t prevented Iowa residents from easy access to bookmakers.
The decision to give operational control of the Aqueduct casino project to Aqueduct Entertainment Group (AEG) by New York Gov. David Paterson has drawn a federal investigation. Entertainer and rap mogul Jay-Z is now in the picture stemming from his friendship with Paterson.
Paterson chose AEG at the end of January to turn the aging track into a state-of-the-art gaming venue with 4,500 video slot machines. The criticism of Paterson’s selection came when Penn National Gaming revealed its bid was 50% greater than AEG’s. But, Paterson allowed trailing bidders to catch up and has been rumored to give AEG the rights because of the group’s ties to Queens political activist Reverend Floyd Flake.
“The partners were looking to bring in someone who could bring marketing and community advice to the team,” said AEG spokesman Jonathan Rosen to the New York Post.
“There is absolutely no relationship between Governor Paterson’s friendship with Jay-Z and the choice of AEG,” said a representative for Paterson.
In the spring of 2009, Jay-Z wanted to be a minority partner on the racino project with Steve Wynn of Wynn Resorts. When that fell through, he was tapped in early September by AEG Chariman Richard Mays to take part in the deal, but they were ranked last among the six bidders at the time. The rapper agreed to take a 7% stake in AEG through one of his companies, Gain Global Investments Network LLC. The federal authorities are investigating why AEG was selected over higher bidders with more experience in casino management and gaming.
Reports have turned up that FBI agents in Washington state are interviewing online gambling customers of Full Tilt Poker. Full Tilt is one of the largest Internet poker sites and may be the first case of a gambling operator being prosecuted through the Unlawful Internet Gambling Enforcement Act (UIGEA).
Small-time players on the twoplustwo poker forum said they have received unannounced visits form FBI agents asking about their transactions with Full Tilt. The agents are not looking to prosecute the players, but instead gather information on Full Tilt. This could be an indication of an information gathering process to build a federal case against Full Tilt.
Washington was probably targeted because it is one of the few states where online poker is illegal. Players from the state have been contacted and warned that charges against them are pending. The UIGEA only penalizes violators under existing gambling laws, so gambling operators accepting Washington residents would fall under those existing laws. Internet gaming in Washington is a felony, so reluctant gamblers will be pressure to cooperate, unlike the past with other jurisdictions.
The UIGEA takes effect June 1st, unless Congress changes or repeals the law before then. Barney Frank’s bill is trying to regulate online gambling before that date. Full Tilt could be in for a load of hurt as the Department of Justice could give the gaming operator so much financial and legal trouble as to force it out of the U.S. market. Full Tilt is the second largest online poker site.
Starting in September of this year, Quebec will be offering legal online gambling, following government approval. Loto-Quebec sent a request to the Quebec Government asking for permission to offer online gambling to it citizens and it has been accepted. Anti-gambling groups fear that it could lead to an increase in gambling addiction. Supporters argue that regulated gambling is the safest option and that the Internet doesn’t create an addiction. The supporters point out that the Internet offers ways to prevent problem gambling through various addiction prevention organizations. Statistically, the level of addiction among gamblers has been stagnant even though the online market has grown exponentially.
Loto-Quebec has plans for weekly gambling limits, age limits and an option for self-exclusion. The government insists that it will be able to monitor peoples’ activities and follow up on any potential problems. This ruling could lead to wider regulation of online gambling in Canada. Other states can use Quebec as a model for their localities.
The Quebec Government is expected to see $50 million or more in revenue over the next few years as a result of the legalization. Quebec can only hope to emulate Sweden. The day the publicly owned Swedish lottery corporation’s poker site went online, it captured 25% of the available market share with four hours of the launch. In 2008, the Swedish online gaming market generated $600 million in sales. Consumer protection and a wealthy government income avenue could be the only reasons needed for legalized online gambling across all of Canada.
After nearly a decade, the door for legalized gambling in Hawaii is open again. The state is facing a $1.2 billion budget deficit and gaming revenue may be the boost it needs. However, a long-time policy denies Native American casino and gambling right to Native Hawaiians. Lawmakers are still opposed to residents being permitted to gamble but a law allowing one or more casinos to open, but forbidden to Hawaiians to play, is under consideration.
In the past, U.S. Senators Daniel K. Inouye and Daniel K. Akaka have requested that the federal government official recognize the island’s indigenous people but not include sovereign gaming rights. The bill would establish a gambling commission to oversee any new gaming establishment. Hawaii would impose a 7% tax on monthly gross income and retain some for the commission’s administrative costs and a treatment program for problem gamblers.
A study released by those backing gambling and casino interests revealed that a passage of the bill would bring as much as $143 million in new taxes and nearly 20,000 jobs. It is predicted that one casino would generate half the tax revenue annually, or $71.5 million, and would take one to two years to be established. This makes it clear that gambling alone would not solve the state’s budget crisis.
Hawaii Governor Linda Lingle has remain opposed to the bill as not a moral issue, but rather that it would divert tourist dollars from one source to another instead of bringing in any new income to the state. Unlike a decade ago when gambling interests were ready with specific projects, the country is desperate for revenue and investors are waiting to see whether lawmakers are serious in Hawaii and other states. Hawaii and the Mormon-centered Utah are the only two states where no form of gambling is allowed.
Barney Frank’s bill to regulate online gambling is currently taking a backseat in the U.S. Congress while issues like health care and financial reform are debated. The slow pace has experts predicting Internet gaming to arrive in the U.S. in a state-by-state basis, instead of a national reform.
New Jersey lawmakers are working on a bill to allow Atlantic City casinos to operate online gambling services in the state. California has considered a similar plan, but the influence of tribal casinos has their bill at a standstill. Florida is commissioning a study on potential revenues created by regulating online gambling. Pennsylvania and Delaware are also considering gambling expansion. Iowa has joined the fight among many U.S. states against the federal ban on sports betting, as deemed by the Professional Amateur Sports Protection Act of 1992 (PASPA).
“If New Jersey is successful [with online gaming] you will see Pennsylvania, Delaware, Connecticut, New York and some other states introduce some level of gaming,” said Joe Brennan, Jr., chairman of iMEGA. “It’s very likely that you will see New Jersey legalize it within a year.”
Those online casinos operating in foreign countries would love to expand to the U.S., but are considering all outcomes. Many Internet casino companies are planning for either base U.S. operations as business-to-business, or to set up software that can be easily adapted to fit within different laws and regulations. Frank introduced the HR 2267 bill in May of 2009. Poker Player Alliance (PPA) Executive Director John Pappas is calling for bi-partisan support to push the bill through. The PPA has long supported online gambling and are encouraging players to contact their respective legislators to get their voices heard. If the bill is not converted into law by June 1, the UIGEA (Unlawful Internet Gambling Enforcement Act) rules take effect.
In the past, Mastercard has wanted to block deposits made by United States residents at online gambling. But, they could not identify a coding system that would stop payments only from those they wanted to exclude from going through. Instead, they were processed as uncoded transactions.
Now, Mastercard has figured out a way to prevent those attempted online gambling transactions at online casino and online poker sites from being processed. In the future, online gambling sites may figure a way around it. But, for now, if you live in the U.S., online gaming sites are blocked for Mastercard users.
This comes at a time when online gambling is at a crossroad. The UIGEA (Unlawful Internet Gambling Enforcement Act) was delayed from the beginning of this year to June 1st. So, the online casino world is waiting to see if Congress will pass Barney Frank’s online gambling bills. Basically, it doesn’t look good for online gambling until the UIGEA is abolished and U.S. Congress adopts the online gambling bills as law. In the meantime, online gambling software needs a way to be effectively blocked, just in case the UIGEA is enacted. Then, credit card companies must be ready to put the blocks in place or face the legal repercussions.
Visa has not solved the coding problem as effectively as Mastercard, so players that use Visa credit cards are still able to make online casino deposits with them. Online gambling sites are still processing them as uncoded transactions. This may be temporary for Visa, which could use the methods discovered by Mastercard. In the past, financial institutions have wrongfully blocked gambling transactions that shouldn’t have been blocked, such as lottery tickets. All in all, this is not good news for online gamblers in the U.S.
Gaming software developer Playtech has announced the release of its Mobile Web Apps, a series of applications that will bring the company’s gaming products to mobile devices such as cell phones. Playtech announced in January a list of initiatives for this year and the mobile gaming platform is first on the list. Games available on the platform are blackjack, craps, video poker, Texas Hold’em and their signature slots.
Playtech stated that their platform will bring a new level of graphics to phone-based gaming. Progressive jackpots, greater security and protection against problem gambling are promised as well. Playtech has been a mover and shaker in the industry lately, creating a lot of speculation. Their deal with Sportech puts the company in position to offer sports betting on the mobile applications. The recent partnership with Scientific Games has many people speculating that Playtech is planning to secure a U.S. license if and when the country’s online gambling market is opened. Currently, Playtech refuses U.S. customers because of the UIGEA (Unlawful Internet Gambling Enforcement Act) ban.
The mobile platform will be available on personal computers or on devices for on-the-go use. Players can use the same account and log-in details for both. No download is needed with the instant play mode of the mobile applications. The technology can also be used on Android phones, the iPod Touch and the iPhone. Mobile Web App examples are a video poker game called Jacks or Better, blackjack and a progressive slot game called Gold Rally. Gold Rally is linked to Playtech’s online casino progressive slot jackpot, which has paid out more than a million to each of five players over the past year. Three Java-based games are scheduled for release as well. They include keno, bingo, pop bingo and the ever-popular “rock, paper, scissors,” which will carry fixed odds.
A new, unique feature called “Casino Pack” allows user to bundle a number of games into a single, downloadable package. Playtech’s IMS (Information Management Solution) will be transferred over, allowing integration across multiple platforms. Even though Playtech is the largest publicly traded online gaming software company in the world, they haven’t gone over the final hump. Mobile Web Apps are another step to get noticed by industry giants like Microgaming and Cryptologic.
The International Gaming Expo (IGE) wrapped up last week and online casino software providers revealed some new games for 2010. The IGE is the premier showcase for new gaming software and ran in conjunction with the Betting Show, the Amusement Trades Exhibition International (ATEI), the International Casino Exhibition (ICE) and the International Casino Conference (ICC).
WagerWorks, operating under International Game Technology (IGT), released the online slot Monty’s Millions. This one was special because it was the first game from the group that was released to land-based casinos as well as online casinos at the same time. More of the same is expected in the future, such as the release of a slot game called Kitty Litter and other branded slots this year. WagerWorks upgraded to an RGS platform, enabling operators on other platforms to download their games and offer them.
Microgaming, endorsed by big operators like Ladbrokes, 32Red, Jackpot City and Unibet, featured its Hellboy slot game. That slot was released in conjunction with Dark Horse, the live dealer blackjack and bingo side games. Microgaming’s mobile gaming partner, Spin3, announced a deal with gambling firm Rocketspin to spread its presences into the East European market.
Cryptologic showcased its recent slot achievements like Batman, Superman, Braveheart and Forrest Gump attained from its deal with Paramount Digital. 2009 releases included Jenga and Call of Duty Modern Warfare. Also presented was a new player protection facility for its blackjack games, which warns players if their moves are not optimal.
Playtech concentrated on its deal with Scientific Games, displaying innovative game content developed by Sciplay, and Sportech, which marked its entry into the sports betting world. Also featured was the release of a pack of nine new slot games, including five Marvel movie-based slots.