Unlawful Internet Gambling Enforcement Act of 2006

[Rollo]

Well, I'm starting this thread for those who want to analyze the the text of the beast and debate the likely fallout. This is a big deal for the industry any way you look at it and things are going to change.

After a more careful reading of the measure, here's what I gather.

1) If a casino, sportsbook, poker room, bingo, lottery or other gambling entity (save horse betting and fantasy sports) accepts any money from a US player, they are subject to fines and up to 5 years in prison. (I'm assuming this includes everyone from the employee who took the wager up to the chairman of the board). Therefore, this bill has effectively made all forms of online gambling illegal. That is they commit a US crime the moment they accept a payment in one of the proscribed ways from a US player in order to take a bet. I'm not sure if this includes players who send money, but it looks like it might. It is sort of ambiguous but they do say any bet “initiated” (it’s the players who initiate bets) or received, but defers to state law were there is a conflict.

It won’t end online gambling, just take its biggest market out of play for large scale operations that fear prosecution. Foreign betting will continue as usual and fly-by-nighters catering to US clients will now have a space to make a come back. Online gambling will likely go from a 12 billion industry and growing to a 5 billion dollar industry and shrinking for a while as the big boys stop taking US wagers.

2) Firepay and Neteller are screwed. They won't go out of business and what they do has not been criminalized. However they will in short order be "blacklisted" so that any attempted transfer to them within the US jurisdiction will not be honored. i.e. a check, money order, wire, credit card etc. The DOJ can seek to block transactions in District Court for whomever it thinks is facilitating the transfer of US money to offshore gambling. I assume the banks will voluntarily comply. So large scale professional outfits like Neteller and Firepay (sitting ducks) will not be able to effectively operate as all financial lines to them can be blocked which will kill a majority of their business. Since gambling was their reason for being, I assume their days are numbered as now they must complete with better services (i.e. Paypal and the upcoming Google service).

3) ISPs, web hosts, etc. are totally exempt from any criminal penalties as well as any obligation to police their space, but I assume most US hosts will not want to host gambling related sites any longer and will start including this in their terms. This doesn’t include sites where actual wagering takes place which is criminal. This could even affect the domain names of gambling entities such as 888.com.

4) Gambling advertisers such as bocguide.com and casinomeister.com can be forced to remove links to gambling sites (by whom I’m not sure, web hosts, IPSs, the DOJ? – they don’t really say). No penalties were spelled out for non-compliance. It looks like other than difficulties finding a host, advertisers can continue as before, however they too will obviously be effected by the massive loss of market so expect to see more British Pounds on those gambling banners in the near future.

5) The burden of making sure all of this happens falls on the financial industry. They have 270 days in consultation with the Fed and the DOJ to figure out how to do police it and if it's too burdensome, their obligation could be waved. No penalties for non-compliance. I don’t expect them to make a big effort, but they really don’t need to make one. The DOJ can simply flag certain serial offenders such as Neteller and Firepay. I assume they will all comply voluntarily rather than push the envelope. They really have no incentive to go to the mat for offshore casinos.

6) This 270 days does not appear to apply to the legality of taking wagers so, I think within 30 days after Bush signs this thing into law (is that the normal time frame, I’m not sure), 888.com and Party Gaming will be subject to criminal penalties the moment they accept a transfer from a US player directly or indirectly.

In sum, this does look bad. I guess that there will be a flood of casinos now banning US players for fear of prosecution. Sending money to a casino as a US player just got more difficult and US players will now have to gamble at the whole slew of fly-by-night casinos that are sure to pop-up to serve the diehards. It’s back to the bad old days for US players as only seriously shady folks are going to want to take that risk.

Party Gamming, 888 Holdings et al stocks are going to tank and the online gaming industry is going to be a shadow of its former self for many years to come…

But it will rise again I suspect…

I could have misread all this as I'm totally drunk at the moment (its Saturday and life must go on), but it appears this law has some teeth.

Anyone else want to take a crack at it?

[Casinomeister]

Originally Posted by Rollo

4) Gambling advertisers such as bocguide.com and casinomeister.com can be forced to remove links to gambling sites (by whom I’m not sure, web hosts, IPSs, the DOJ? – they don’t really say). No penalties were spelled out for non-compliance. It looks like other than difficulties finding a host, advertisers can continue as before, however they too will obviously be effected by the massive loss of market so expect to see more British Pounds on those gambling banners in the near future.

I could see being asked to remove links on a website served within the US. But if the company is located outside the US, the servers are outside the US, I don't think the US has any jurisdiction over this.

[just play]

I'm confused.....this already passed? The latest thing I saw posted here (someone posted a link) in another section was that George Bush still had to sign it?

[Westland Bowl]

Originally Posted by just play

I'm confused.....this already passed? The latest thing I saw posted here (someone posted a link) in another section was that George Bush still had to sign it?

His signature is largely a given. The only thing we can hope for is for him to strike out the Internet gambling provision before he signs....which isn't likely. But maybe, just maybe, since he can't go for a third term, he'll just do that. I dunno.

[Westland Bowl]

Ya know....the bill doesn't mention about money ALREADY in Neteller accouints. If you use your own money in Neteller without ever needing to get cash from your bank account, credit card, etc. from now on, then, since Neteller isn't in USA, you'll be transferring money back and forth between casinos, Neteller (Firepay and others), without touching any US bank or other US entity.

So if you continue to make profits with money you transferred from your bank long ago, then you probably do alright since the law covers EFTs from effective date on.

[aka23]

Originally Posted by Westland Bowl

Ya know....the bill doesn't mention about money ALREADY in Neteller accouints. If you use your own money in Neteller without ever needing to get cash from your bank account, credit card, etc. from now on, then, since Neteller isn't in USA, you'll be transferring money back and forth between casinos, Neteller (Firepay and others), without touching any US bank or other US entity.

So if you continue to make profits with money you transferred from your bank long ago, then you probably do alright since the law covers EFTs from effective date on.

Is it clear that players in the US will be able to cash out money in Neteller accounts after the law goes into effect?

[sdaddy]

Originally Posted by Westland Bowl

Ya know....the bill doesn't mention about money ALREADY in Neteller accouints. If you use your own money in Neteller without ever needing to get cash from your bank account, credit card, etc. from now on, then, since Neteller isn't in USA, you'll be transferring money back and forth between casinos, Neteller (Firepay and others), without touching any US bank or other US entity.

Exactly. That's going to be my approach from now on. As of now, my Neteller account is funded well enough so that I should not need to make a deposit from my bank account again.

Originally Posted by aka23

Is it clear that players in the US will be able to cash out money in Neteller accounts after the law goes into effect?

That's the only remaining question in my mind. It doesn't seem likely that my bank would go so far as to prevent me from depositing a check from my Neteller account. I'd really like to hear others opinion on this, however.

[Simmo!]

Originally Posted by aka23

Is it clear that players in the US will be able to cash out money in Neteller accounts after the law goes into effect?

It will be I'm sure. After all, it will take around 270 days before this becomes law so its not like we should all be in a rush to do stuff here.

[The Watchdog]

Originally Posted by Casinomeister

I could see being asked to remove links on a website served within the US. But if the company is located outside the US, the servers are outside the US, I don't think the US has any jurisdiction over this.

If I am not mistaken, this could be avoided by just changing the site to www.casinomeister.gr.co, or www.casinomeister.xxx

(xxx) standing for any extention for a server not located in the US....

You could change your URL to a Costa Rican site... www.casinomeister.co.cr

Here, no one will waste time to give you crap for advertising.

[sneakattack]

Just wanted to make sure of this: we have 9 months before any legal enforcement begins. Thus until june absolutely nothing is happening, except maybe more casinos banning us players. Money currently in neteller or at casinos is at no risk?