[Caveman]

Here you go, the mother of all conspiracy theories. It is very long and also purely based on an overactive imagination trying to make sense of this whole situation. I am not saying this is what is happening, I just wrote this to get rid of some of my frustration, sometimes it calms my mind to write things like this to get them out of my head.

Bill Frist: Why did he push this so hard? I know the general opinion seems to be to court the religious right, Congressman Leach’s support, etc and it really might be that simple. Maybe he had a child, relatives child or close friends who failed in school due to spending their time playing poker online and it became personal for him. The last possibility is he was convinced of something that could really boost his exposure and give him a real boost in his Presidential aspirations at just the right time.(Right before the primaries for maximum effect.) This last option will make more sense at the end of the piece I am writing now.

Existing online sites: Why didn’t they do more to prevent this legislation? This on is a real bear to get a handle on. Were they really so stupid as to assume that nothing would pass so that they didn’t have to make a serious effort to prevent this? I could believe this about some of the sites, but to believe this of all of them is quite a stretch in my opinion. Granted the True Poker CEO was at least active on the forums and concerned, but he is the only one that seemed to care at all. Maybe they were convinced by someone or some group that the threat wasn’t nearly as big as it appeared on the surface. It would have taken someone inside the gambling industry to pull this off. There is really no way for me to know the answer to this question, but I have an idea on a mechanism that might have been used to convince all those involved that enforcement would be very difficult if not impossible. It has to do with the banks and cost of enforcement of the regulations.

This legislation is focused on making the banks and financial institutions the primary tool in stopping the flow of money and thereby making it impossible or extremely difficult for US citizens to gamble online. Others have pointed out how there is no way the banks can refuse to do this and they are technically correct the banking industry has to comply if the government insists. The banks are really the only hope we left, there is a possibility that doing what the govt. wants is too costly.

What is an EFT (Electronic Funds Transfer)? This is exactly like it sounds, if the money is moved electronically it qualifies as an EFT. This includes the EFT transfers most of us are familiar with from tying Neteller to our bank accounts. It also includes every ATM transaction, use of debit cards, prepaid phone cards, etc. short version is that it includes ANY and all ELECTRONIC TRANSFERS of money. You go into Walmart and pay with a check, they convert it to an EFT at the register and hand your check back to you, because they no longer need the check. The US Treasury prefers to due business by EFT for the same reason as Walmart it costs much less. The Treasury says it cost something like 0.89 cents to process a check vs 0.07 cents to process an EFT, quite a costs difference. There are millions, possibly hundreds of millions of EFT transactions every day in the US. How much is it going to costs for the banks to make sure none of these transactions is done with money from online gambling. While the banks can’t refuse to enforce the regulations even the Govt. Would have a hard time saying the banks should spend more money to enforce the regulation than the whole online gambling industry represents. The American people may not care one way or another about online gambling, but if the banks say its going to cost them every time they do an EFT they will care about that. What about businesses having to pay these fees for every EFT, in short it could seriously damage not only these business but possibly the whole American economy. If this is in fact the case what do you think will happen to these regulations?

Suppose about the same time that the banking industry is talking about these costs someone steps up and offers a possible solution. Someone like this group that is about to buy Harrahs steps up with a solution. They say allow online gaming but make people physically come to a casino to register in order to verify identity and age if they want to play online. This eliminates the underage gambling objection. They also agree to send in the proper tax documents to the IRS and to the state the people are from. This would make sure the Govt. Get the money it feels its due from both the sites and individual players. The games would be regulated by existing or new gaming commissions ensuring the fairness of games. Money would be held in US banks thereby making sure people are not taken advantage of by fly by night companies operating from places where the owners are effectively untouchable by US laws. This also helps the Govt. Prevent money laundering which the politicians seem to think is going on now. If someone loses a certain amount of money gambling online they will have to prove they have the means to afford the losses or they will be cut off. This at least gives some control over making sure that people with gambling addictions do not click the mouse and lose the house as the politicians seem so fond of saying. They could give individual states the right to make this illegal if they so choose, giving the gambling rights choice back to the states themselves.

What this accomplishes is giving US companies control of the American players. These companies will not have to fight for market share it will be handed to them. Plus it wouldn’t just be online poker it would be online casinos too. The sites being US based could offer incentives to players such as free rooms etc thereby also increasing the land based business profits too. They could either allow foreign players to sign up or make agreements with existing companies like the skins of different sites do now. The real question is whether someone or some group had the wherewithal to try this, possibly even orchestrate it .Its worth taking a shot due to the amount of money involved we are talking billions here. Existing sites will go to the WTO screaming about protectionism, but the US will argue that underage gambling was rampant and that there is no way for those sites to truly prevent this. They will probably also mention the money laundering angle, security of funds, and fairness of games issues.

Back to how Frist benefits. He can state how while he abhors gambling and did his best to stop it, the politicians still in office decided it was not worth it do to the cost of enforcement. While his legislation was not completely successful it did prevent underage gambling, and increased revenues for the Govt by making sure that taxes are paid by both the players and the companies. People who suffer from gambling addictions will have at least some protection which is better than the no protection they had before. In addition it won’t be offshore fly by night companies doing this but legitimate US based businesses, ensuring the integrity of the games and policing for possible money laundering operations. I am sure he and his people would be able to spin this in their favor even more, making this a win-win situation for him. If the new rules are announced at the right time he gets publicity (free advertising) and a platform to speak from to try to launch his bid for the presidency.

Damn, I just realized I had my tinfoil hat on inside out, no wonder Iv'e been having so many crazy thoughts.