Off Shore Gaming Association

As the football season approaches we had several requests to clarify the legality of betting online with an offshore bookmaker.

The bottom line on the million dollar question of “Is this legal”, is no - according to the Catherine Hanaway, US Attorney in St. Louis, Missouri. She testified this past winter in front of the House sub-committee that the Department of Justice sees all Internet gambling as illegal. However, she has not gone on to prosecute racing sites like BrisNet or YouBet for accepting racing wagers or the NJ lottery for it’s online Slingo game. So clearly, her statement was a bit misguided.

Unfortunately for gamblers, the UIGEA did clarify all of this to some extent and does provide some backing for her statement. In essence, the US government now bears no distinction between the corner bookie or speakeasy card game and the online operator – both are accepting illegal bets. This is why some of the largest gaming companies, and all of the publicly traded ones, exited the US market after the November 2006 passage of the UIGEA. Certainly investors would not sink money into a company that is accepting ‘illegal’ bets.

Still, we have not heard of a single gambler being prosecuted. In fact, an Arizona case in 2006 found a local bookie using a price-per-head service offshore and the local sheriff organized a year-long sting that successfully busted the entire illegal betting ring. They also were able to garner his complete list of clientele. And, the sheriff who headed the operations came out at the time stated that he also expected to net 200 to 300 other people who made bets. None have been indicted to date. In addition, back in February of this year, another ring, this time in Massachusetts, was popped, again using the Internet to process wagers. This time the lead officer was asked if investigators might take legal action against the bettors themselves and said, “Historically, we haven’t.”

So, even though these bets may be construed as illegal, online gamblers should have little fear of prosecution. It’s all about the money……and there is not much to be gotten from the gamblers. But there is from the operators and banks who process these illegal transactions. After all, Neteller coughed up $136 million, the US government seized almost $20 million from FirePay and Catherine Hanaway’s office was able to extort $31.5 million from Miscrosoft, Google and Yahoo for ‘past promotion of illegal gambling’.

Does the $100 online weekend football bettor have to worry about heading to the can or forfeiting their life savings? Probably not, but the question and subsequent cloudy answer is still clearly on the minds of many players nearly 2 years after the passage of the UIGEA. With no indictments against bettors, it is fairly safe to assume that the bettor, though not shielded from prosecution, can wager with little worry.

And, doesn’t this country have enough problems with banks going under, two wars that appear will last for years to come and an economy that dips lower everyday, without going after its own citizens for what they do with their own money in the privacy of their own homes? The answer here is clearly a resounding yes – leave the gamblers alone to their own vices!

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Earlier this week, the head of the Minnesota Gambling Control Board stated that Barack Obama’s website may be running an illegal raffle. The ‘illegal’ raffle seeks a donation of $5 or more between now and midnight on July 31st, and “you could be one of 10 supporters chosen to meet Barack backstage and watch his acceptance speech in person” at the ‘Open Convention’ at Invesco Field in Denver this August.

The Minnesota state Gambling Board website states over and over again that only nonprofit organizations may conduct a raffle. The site does say that a spaghetti dinner, pancake breakfast or car wash could be used to raise money. Perhaps the DNC can ask Obama girl to wash cars for contributions!

Tom Barrett, executive director of the Minnesota board, received a phone call from someone who had seen the website, and after reviewing it, decided to contact the Department of Public Safety, according to local media reports. The call most likely came from a disgruntled Twins bettor who could not get paid because his offshore book claimed the the US laws were making it difficult to make payments to the states.

This also proves what opponents of the UIGEA have been saying all along, that in this country, gambling laws are regulated by the states. Yet this 2006 Federal banking law is what has caused such a great effect on Internet and offshore gambling.

Apparently this could have been avoided had the Obama website either 1) said the contest was void in Minnesota or 2) included a way for people to participate in the drawing without being forced to invest in Obama’s campaign. The brain trust in the Obama camp apparently took the latter as it would encompass evvery state - the site now has a link stating, “If you do not wish to make a donation but would like to participate in this program, you can still be selected to join Barack at the Democratic National Convention in Denver by clicking here.”

Irrelevant of the fact that we are calling our President by his first name, what I wonder is, “What were the Obama organizers thinking?” They must have thought that this would be a great way to drag in $5 donations form the same players who gamble on the Lottery, but I guess no one thought that ‘raffle’ this may actually be construed as gambling. Perhaps Obama should take a look at ALL the laws in this country and review some of the arguments that have gone in front of the House Financial Services sub-committee. It makes me wonder if Obama cannot conduct something as simple as giving away a few seats at a football stadium without sticking his foot in it, how is he going to run the entire country?

It is also quite depressing as the best chance the gambling community has in seeing any recent legislation making it into law is an Obama presidency. But, as a fellow gambler told me the other day as we spoke about the recent political ads we see here on television, “I have greater concerns for this country than gambling laws”. Perhaps this is one of those glaring examples that show why he is voting for the Republican this fall, and his #1 reason for doing so - lack of experience.

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