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US Poker Regulation Update: Where Are We Now?

An online gaming renaissance is currently underway in the US, with first Nevada, followed by New Jersey and several other states, introducing legislation to legalise internet poker or placing such legislation on their agendas.

The result has been a rush of online poker sites entering the US market, along with casinos in these states also looking to get in on the act. However, federal legislation legalising online poker nationwide is still some way off, with an industry still shaking off the effects of “black Friday” – that date in April 2011 when the United States Department of Justice charged principals of PokerStars, Full Tilt Poker and Absolute Poker with bank fraud, illegal gambling offences and laundering billions of dollars in illegal gambling proceeds.

That litigation effectively ended online poker in the country, denying thousands of American poker players the ability to legally play the game in the United States.

Since then the country has been navigating a legal maze, attempting to put legislation on the table to legitimise the game once more in the face of fierce lobbyists opposed to the measures.

In June, Rep. Peter King introduced the Internet Gambling Regulation, Consumer Protection and Enforcement Act of 2013 which would establish a federal regulatory regime for online gaming. At the same time, Rep. Joe Barton also plans to introduce similar legislation.

[quote text=”The momentum is certainly now behind online poker in the US, but the next few months will be crucial to see if any effective legislation will be passed this year to legalise an industry analysts say will be worth billions.” person=”” align=”left”]

However, Barton has been fighting to introduce such legislation since 2011, and previous attempts have all faltered. Similar legislation in 2012 failed after policymakers ran out of time in getting it passed in the last Congressional session.

Various religious groups have been campaigning to stop Congress passing poker legislation since last year, and opposition has also come from some state lottery groups and casinos.

Indeed, Sheldon Adelson, chief executive of the Sands casino in Las Vegas, made a vociferous attack on plans to legalise internet poker, telling Bloomberg in June that: “It’s a train wreck, it’s a toxicity, it’s a cancer waiting to happen.”

Adelson runs a casino based out of Nevada which has led efforts to introduce online gambling, with state authorities believing it would be a vital new avenue for revenue in a difficult economic climate.

However, not all Vegas casino bosses are opposed to online poker. Frank and Lorenzo Fertitta, for example, who run several hotels and casinos in the city, were the first to launch a Nevada poker site – – which has already had a deluge of players sign-up to the site.

Elsewhere, attempts in Kansas by Senator Jacob LaTurner to introduce legislation in the state that would outright criminalise online poker was vetoed by the Kansas State Senate.

Indeed, the tide in support does seem to be turning towards accepting online gambling. Supporters now include the American Gaming Association, which represents many of nation’s biggest casino groups such as Caesars and MGM. In an interview in May, association President Frank Fahrenkopf said his group’s position on the issue has evolved from opposing all forms of online gaming to backing legislation that would fully legalise online poker now. He added that online poker is more acceptable than other forms of gambling because participants play against other players, not the house.

“We’ve seen technology does exist … to really put in place regulatory regimes” that work, Fahrenkopf said.

Meanwhile, Congress is also seeing efforts to create a nationwide regulatory regime for online gambling in states where gaming is legal now, clearing another path for states like Nevada, New Jersey and Delaware. That legislation is set to be put before the House Financial Services Committee.

And finally, Sen. Harry Reid and Sen. Dean Heller, who led efforts in the Senate to introduce online poker legislation last year, are said to be working together again this year on an online poker bill.

The momentum is certainly now behind online poker in the US, but the next few months will be crucial to see if any effective legislation will be passed this year to legalise an industry analysts say will be worth billions.

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