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Top 10 US Poker Rooms
October 2006 Ah, Bill Frist. To many online poker players, even today, his name brings a fit of anger. And it’s only fitting as Mr. Frist (and Jon Kyl) was the one responsible for the attachment of the Unlawful Internet Gaming Enforcement Act, better known as UIGEA, to the totally unrelated Safe Harbor Act. Frist's bill called for the illegalization of online gambling, while Frist received contributions from land-based casinos. He also allowed horse racing and lotteries to remain legal. The effect of the UIGEA would be to dry the money river. The bill prohibits the transfer of funds from a financial institution to an Internet gambling site, with the notable exceptions of fantasy sports, online lotteries, and horse/harness racing. The sneaky part of the UIGEA was the addition of it to the unrelated Safe Port Act, which had a very high estimate of being signed into law, because of the tough and trying times on the National Security front of the United States. Unsurprisingly, the bill passed with a vote of 409-2. But this was not the first time this was tried. In 1999, there was the Internet Gambling Prohibition Act bill in the Senate, ready for passing. Passage of the 1999 bill was defeated in large part however, by the lobbying efforts of Jack Abramoff. That bill was supported by Christian conservative groups such as Focus on the Family, Moral Majority, and the Christian Coalition. Jack Abramoff is a very interesting character however, and pretty much demonstrates the corruption that actually goes on whenever you see bills such as the UIGEA and its predecessor, but his biography is perhaps best left for another article altogether. But now, let’s go back to the UIGEA. UIGEA § 5364 required that regulations be issued by the Federal Reserve and the Department of the Treasury within 270 days of the passage of the Act. In October 2007, these agencies issued a "Notice of Proposed Rulemaking” (NPRM), which effectively tabled draft UIGEA regulations for public comment. In response to the NPRM, four hundred and ten (410) responses were received from depository institutions, depository institution associations, public policy advocacy groups, consumers, “gambling-related” entities, payment system operators, federal agencies, and members of Congress. The Bush (Jr.) administration had previously adopted the position that it would not finalize any rule subsequent to November 1, 2008. This last-minute rulemaking that binds the hands of an incoming administration is commonly termed the midnight drop. The final regulations (termed the “Final Rule”) were finalized and released November 12, 2008, and came into effect on January 19, 2009, the day before the Obama administration took office.[12] Compliance is not required until December 1, 2009 in order to give the “non-exempt participants” an opportunity to implement the necessary safeguards and procedures. It is important to note that the legality of the game itself, meaning poker, is not at question in the UIGEA. What the UIGEA does is make it impossibly difficult for any American to deposit, withdraw, or have any other kind of financial transaction with a gambling institute that is abroad. The way of achieving this was to make the financial transactions illegal and punish the banks and financial institutions who chose to still allow transactions involving gambling, Internet, and Americans. But the UIGEA’s consequences were far reaching, not just an outcry on a global level, reminiscent of the destruction of Alderaan in Stars wars. In the words of Obi-Wan Kenobi, “like a million voices screamed out in terror, and then, silence”. First came the exodus. Many big players stopped providing their gambling services to the American Market. More precisely, all the online poker rooms that were publicly traded on the London Stock Exchange or similar markets stopped taking American players immediately, and canceled the accounts of old players awaiting a method to allow them to withdraw their funds from the site. Partygaming Plc., the parent of Party Poker and Party Bets, took the hit particularly harshly. Its publicly traded stock lost around 70% of its value within 24 hours after the bill passed. The company was moved from the FTSE 100 to the FTSE 250 Index on October 11. Peter Dicks, chairman of SportingBet, and David Carruthers , chief executive of BetOnSports were also detained in 2006. Both high-level executives of sports betting firms got the short end of the stick, and were charged with some sort of random crime. Dicks got “running a gambling enterprise by computer” (a crime in Louisiana) and was arrested in JFK in NY under Louisiana law. He got released under a $50K bail. Carruthers, however, is still under house arrest at a hotel in St. Louis awaiting a hearing concerning Federal charges filed in Missouri related to his company taking wagers over the telephone and Internet from US citizens. He’s got the following charges hanging on his head: a RICO charge, 'Mail Fraud', 'Transmission of Wagers/Wagering Information', 'Interstate Transportation of Gambling Paraphernalia', and 'Interference with Administration of Internal Revenue Laws', specifically the evasion of Federal wagering excise taxes. The online payment processors also took large hits. All of the major ones had to drop any and all business with American customers immediately. Many players were left with hundreds of thousands in frozen monies on the sites, such as Neteller, Moneybookers, Firepay etc. In January of 2007, the founding members of Neteller were also detained while on a transit flight in the US on conspiracy charges. However, there has also been a massive international backlash on the UIGEA. The most important thing is that the sentiment is growing that the U.S. is meddling in other people’s affairs. Most indicative of this is the situation between the U.S. and the island nation of Antigua. Antigua and the United States have been involved in a long-running World Trade Organization dispute over U.S. restrictions on online gambling. The WTO ruled on January 25, 2007 that the U.S. is in violation of its treaty obligations by not granting full market access to online gambling companies based in the island nation. On March 30, 2007 the WTO confirmed the U.S. loss in the case. On June 19, Antigua filed a claim for USD $3.4 billion in trade sanctions against the United States, along with a request for authorization to ignore U.S. patent and copyright laws. This claim was filed a day after similar demands for compensation were made by the European Union. The United States settled the dispute by granting concessions in other sectors. The administration of President George W. Bush refused to disclose the details of those concessions, however. In April 2008 Congressmen Barney Frank and Ron Paul called for the agreements to be made public. They stated that the concessions "could cost the United States many billions of dollars in compensation" and that the administration's invocation of "national security" as a reason to block disclosure under the Freedom of Information Act (FOIA) was "a misuse of the FOIA process." When the administration continued to keep the information secret, Public Citizen brought suit on behalf of Ed Brayton, a journalist whose FOIA request had been denied. The UIGEA has also been challenged on a national level, most notably by U.S. Congressman Barney Frank. In April 2007, Barney Frank introduced a bill to overturn the gambling aspects of the act saying, "The existing legislation is an inappropriate interference on the personal freedom of Americans and this interference should be undone." Additionally the bill sets up the framework for taxing and regulating online gambling by individuals within the United States. All in all, the UIGEA, both in concept and implementation, has been nothing but a big mess. It has been a big and unfair muscled shakedown of the smaller fish by the big fish. What the Americans want or do not want does not seem to matter. All that matters is that rules can be made for abroad businesses, and these rules are forced to be implemented by anything and anybody. Have you ever come across a confusing poker term? Our poker dictionary has 1218 definitions! Play for FREE and practice your game at...Would you like to submit your own poker article to be featured on FTR? You can by clicking here - Submit a Poker Article! Related Articles
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