U.S. Justice Dept. doesn't understand UIGEA either

[kidpokeher]

News is a week old but I don't see mention. How ironic is this? (link) (http://www.ft.com/cms/s/0/4b6da262-660d-11dc-9fbb-0000779fd2ac.html) The horse racing industry may become our new friends.

Under a list of “frequently asked questions”, Twinspires says it operates legally in the US. It cites legislation passed by Congress last year that toughened federal anti-gambling laws, while protecting companies that run internet bets on horses from the new rules.

What Twinspires and several other websites fail to disclose is that the US justice department disagrees with this assessment

[kidpokeher]

Also, National Coalition Against Legalized Gambling (NCALG) doesn't understand UIGEA either but that was expected. Check out their Fact (spin) Sheet:

http://www.ncalg.org/Library/internet/IG%20Law%20booklet.pdf

Myth: UIGEA has “carve-outs” for lotteries, horseracing, and fantasy sports.
Fact: UIGEA explicitly applies to lotteries. It does not change the law for horseracing. And it does not allow gambling on fantasy sports.


What part of this actual UIGEA text (among others) is not a carve-out for horseracing? The bastards crafting the law devoted more area to a horseracing carveout then they did to the actual law.


‘‘(D) INTERSTATE HORSERACING.—
‘‘(i) IN GENERAL.—The term ‘unlawful Internet gambling’ shall not include any activity that is allowed under the Interstate Horseracing Act of 1978 (15 U.S.C. 3001 et seq.).

[meleader2]

Fact: 100% of what's printed on the internet aside from .gov sites are opinions.

[crzylgs]

[ QUOTE ]
Fact: 100% of what's printed on the internet aside from .gov sites are opinions.

[/ QUOTE ]

That's just, like, your opinion, man...

[Skallagrim]

The reason the regs have taken this long to write is that NO ONE "understands" the UIGEA.

Take one example: is playing the card-game called Bridge for money online illegal?

There is no Federal Law about Bridge. In South Carolina, however, it is against the law to play ANY card game for money? Does this law, which way predates the internet, apply to the internet? Who decides that? And if it does apply, does that mean mean money transfer agents (like banks) must monitor every online transaction to make sure its not a South Carolinian playing online Bridge for money or they otherwise violate the UIGEA? How about the fact that online Bridge sites, are not "in the business of betting and wagering (as casinos and sports books are) but are in the business of providing an environment where others bet and wager, does that make a difference? How about if a Costa Rican company sells you "phone time" but then allows you to use those phone credits to transfer credits to an online Bridge site? Should/Can the bank that issues your credit card stop you from buying those Costa Rican phone credits? And why should South Carolina have the right to require national and international companies to know and enforce its law regarding the internet (if its law applies to the internet) doesn't that violate the Interstate Commerce Clause of the US Constitution? Is playing Bridge for money gambling just because SC includes it in their anti-gambling laws? Some Courts have held bridge to be a game of skill. Who decides that, SC or the Feds?

I cant wait, really, to see these regulations. My guess is they will gloss over all these points with simple broad language. If I am wrong, and the regs actually attempt to do something, your banking fees will increase dramatically and lawyers will get rich litigating these types of questions for a generation.

Skallagrim

[JPFisher55]

Substitute the word poker for bridge, which I extensively played in college, and you have a great summation of the present situation for us online poker players.
Skall, if the regs are broad and gloss over these issues, then can some entity sue to force more specific regs without some government threat of prosecution?

[CORed]

[ QUOTE ]
Fact: 100% of what's printed on the internet aside from .gov sites are opinions.

[/ QUOTE ]

And 73% of all statistics are made up on the spot.

[Skallagrim]

[ QUOTE ]
Substitute the word poker for bridge, which I extensively played in college, and you have a great summation of the present situation for us online poker players.
Skall, if the regs are broad and gloss over these issues, then can some entity sue to force more specific regs without some government threat of prosecution?

[/ QUOTE ]

Of course I used Bridge as the example game because it highlights the confusion without getting into an argument about the nature of Poker. But, again of course, you can substitute the game of poker for bridge and ask all the same questions.

As to your specific question, I cant think of any way to get the judicial branch of government to force the executive branch to (re)write regulations. The judges merely decide whether the regs are lawful or not, and then its up to the exec to act.

There is a mechanism to sue, however, and it is already hinted at in the iMEGA suit: unfair restriction on trade. If the regs are so vague that the banks just stop doing any transactions with any company even remotely related to gambling, then any such company would have standing to sue upon showing a definite loss of business as a result. So, for example, if ePass cant do any more wire transfers because of the new regs and goes into court and says "hey these regs are stopping my lawful business" they have grounds to make their argument. Under such a scenario a Court could rule that the regs as applied are unconstitutional or unlawful when applied to otherwise legal businesses. (Caveat: this kind of argument is very complex, and not a SURE winner).

Skallagrim

[DeadMoneyDad]

[ QUOTE ]
[ QUOTE ]
Fact: 100% of what's printed on the internet aside from .gov sites are opinions.

[/ QUOTE ]

And 73% of all statistics are made up on the spot.

[/ QUOTE ]

100% of all opinons that don't agree with mine are WRONG!

D$D

[JPFisher55]

[ QUOTE ]
[ QUOTE ]
Substitute the word poker for bridge, which I extensively played in college, and you have a great summation of the present situation for us online poker players.
Skall, if the regs are broad and gloss over these issues, then can some entity sue to force more specific regs without some government threat of prosecution?

[/ QUOTE ]

Of course I used Bridge as the example game because it highlights the confusion without getting into an argument about the nature of Poker. But, again of course, you can substitute the game of poker for bridge and ask all the same questions.

As to your specific question, I cant think of any way to get the judicial branch of government to force the executive branch to (re)write regulations. The judges merely decide whether the regs are lawful or not, and then its up to the exec to act.

There is a mechanism to sue, however, and it is already hinted at in the iMEGA suit: unfair restriction on trade. If the regs are so vague that the banks just stop doing any transactions with any company even remotely related to gambling, then any such company would have standing to sue upon showing a definite loss of business as a result. So, for example, if ePass cant do any more wire transfers because of the new regs and goes into court and says "hey these regs are stopping my lawful business" they have grounds to make their argument. Under such a scenario a Court could rule that the regs as applied are unconstitutional or unlawful when applied to otherwise legal businesses. (Caveat: this kind of argument is very complex, and not a SURE winner).

Skallagrim

[/ QUOTE ]

Thanks Skall, that is what I thought but was not certain. Unfortunately, this kind of regs is what I think we will get. I think that they are worse for us than a specific reg defining internet poker to be unlawful internet gambling because they are more difficult to challenge.
I would like to see a reg that permits a bank to process any ACH or other transaction unless the bank has actual knowledge that such transaction is related to unlawful internet gambling which is undefined. I doubt that any bank could ever have such knowledge.

[oldbookguy]

The E-Pass is a good example, however, a better one will be AOL & World Winner and skill games if THESE are blocked in an effort to stop, say, Poker then World Winner and AOL have grounds as they would be harmed since these games ARE legal and even funded by PayPal and we all know how PP feels about gambling.

obg

[Legislurker]

Paypal does not have the same ownership as when they exited the gaming market. I would hazard a guess they are drooling over what Neteller made with no brand name recognition outside the gaming world. Im just wondering at what point corporate America pulls out the big lobby stick for remote gaming.

[oldbookguy]

PayPal lobbied HARD for a more stringent Bill, H.R. 4777, it would have made criminals of citizens for playing Poker online in a letter they sent to Goodlatte last summer (June 2006).

Read it here:
http://www.foxnews.com/story/0,2933,198610,00.html

Remember though, PP (eBay) still funds Skill Gaming in the U.S. and some Poker / Sports Betting in the E.U., NO U.S. though for this.

As to Neteller, yes, eBay was peeved they were doing so well after eBay (after purchasing) paid the 10 million dollar fine.

Somehow, we may even be able to find eBays fingers behind the NT case.

obg

[Uglyowl]

Fixed link:

http://www.foxnews.com/story/0,2933,198610,00.html

Anyhow, I made it a point never to use Ebay again. Speaking of which, I should call them again come Monday to voice my displeasure:

1-866-696-eBay (3229)

[Legislurker]

Heh, another thing with paypal is that they probably wouldnt make it in a regulated environment. A scrupulous regulator can see easy abuses for underage players via Paypal. I know at 14 or 15 I could have easily funneled a poker bankroll thru Paypal, if it had existed.

[kidpokeher]

[ QUOTE ]
In South Carolina, however, it is against the law to play ANY card game for money? Does this law, which way predates the internet, apply to the internet?

[/ QUOTE ]

Is this true or are you being hypothetical? If true, do you have a source?

BTW: This was the part of the article I found most interesting -

In a recent letter to a senior Democratic lawmaker, who was seeking clarification about the status of online horse betting, the department said its long-held view – that interstate betting (within the US) on horses online was illegal – had not been affected by last year’s passage of the Unlawful Internet Gaming Enforcement Act.

[schwza]

[ QUOTE ]
Myth: UIGEA has “carve-outs” for lotteries, horseracing, and fantasy sports.
Fact: UIGEA explicitly applies to lotteries. It does not change the law for horseracing. And it does not allow gambling on fantasy sports.


[/ QUOTE ]


[ QUOTE ]

What part of this actual UIGEA text (among others) is not a carve-out for horseracing? The bastards crafting the law devoted more area to a horseracing carveout then they did to the actual law.


‘‘(D) INTERSTATE HORSERACING.—
‘‘(i) IN GENERAL.—The term ‘unlawful Internet gambling’ shall not include any activity that is allowed under the Interstate Horseracing Act of 1978 (15 U.S.C. 3001 et seq.).

[/ QUOTE ]

these are both true. there is a carveout for horseracing and it says that nothing about the 1978 act is changed. i.e., the law has not been changed. well, now that i look at it again their "myth" is not a myth but their "fact" is true, at least about horseracing.

[kidpokeher]

Did I call it? Straight from the proposed UIGEA regulations (pg. 4)
http://www.treas.gov/press/releases/reports/noticeofproposedrule.pdf
- - - -

The Department of Justice has consistently taken the position that the interstate transmission of bets and
wagers, including bets and wagers on horse races, violates Federal law and that the Interstate Horseracing
Act (the "IHA") did not alter or amend the Federal criminal statutes prohibiting such transmission of bets
and wagers. The horse racing industry disagrees with this position. While the Act provides that the
definition of “unlawful Internet gambling” does not include “activity that is allowed under the Interstate
Horseracing Act of 1978,” 31 U.S.C. 5362(10)(D)(i), Congress expressly recognized the disagreement over
the interplay between the IHA and the Federal criminal laws relating to gambling and determined that the
Act would not take a position on this issue. Rather, the Sense of Congress provision, codified at 31 U.S.C.
5362(10)(D)(iii), states as follows:
It is the sense of Congress that this subchapter shall not change which activities related to horse
racing may or may not be allowed under Federal law. This subparagraph is intended to address
concerns that this subchapter could have the effect of changing the existing relationship between
the Interstate Horseracing Act and other Federal statutes in effect on the date of enactment of this
subchapter. This subchapter is not intended to resolve any existing disagreements over how to
interpret the relationship between the Interstate Horseracing Act and other Federal statutes.

- - - -

Perhaps the UIGEA regs may end up getting the horseracing industry on our side. Good? Bad?

Then again... (pg. 5)

- - - -
The Act also directs the Agencies to
ensure that transactions in connection with any activity excluded from the Act’s
definition of “unlawful Internet gambling,” such as qualifying intrastate transactions,
intratribal transactions, or interstate horseracing transactions, are not blocked or
otherwise prevented or prohibited by the prescribed regulations.

[DeadMoneyDad]

[ QUOTE ]
[ QUOTE ]
In South Carolina, however, it is against the law to play ANY card game for money? Does this law, which way predates the internet, apply to the internet?

[/ QUOTE ]

Is this true or are you being hypothetical? If true, do you have a source?

[/ QUOTE ]

I beleive this is a common misconception.

The statue makes it illegal to use physical cards for even games of entertainmnet (no betting) without having paid a stamp tax first, as well as properly displaying the stamp among other things.

There may be other statutes but this was the main one I saw cited when I looked at SC law.


D$D

[Skallagrim]

This absolutely illustrates the difficulties of determining what is illegal gambling under state law. There at least used to be such a statute in South Carolina. I know because I have it noted from research a while back. While looking for it to answer this question, it appears to have disappeared. I think there may have been a change/cleanup in the statutes when SC got a state lottery. I am not sure. I would have to go to a library or online research ALL SC statutes to be sure. I am not gonna do that for this forum, sorry. But imagine how difficult it is for a "bank" to answer this question if I cant without significant research.

SC people, maybe your bank will let your poker transactions go through, maybe not.... at least SC law says nothing about the internet.

Skallagrim