Internet poker players to Congress: We have rights too

[Eric]

The players' goal for the fly-in: to boost support for a couple of
bills, which so far enjoy backing from only a handful of politicians,
that would roll back a sweeping ban in favor of more tailored
regulations. One proposal would expressly carve out poker from any ban
on online gambling, placing it in a category with "games of skill"
like backgammon, mahjong and bridge.

"Certainly I think the growth of the game has been hurt," Howard
Lederer, a two-time World Series of Poker bracelet winner, said of the
current law's impact at a public forum organized by the PPA here
Wednesday. He's known as the "Poker Professor" for his commentary and
analysis in card-playing circles and is one of the founders of the
online card room Full Tilt Poker.

That's unfortunate, Lederer argued, because "yes, it can be used as a
vice, but for most of us it's a wonderful form of entertainment that
actually massages your mind, gets you thinking."

Supporters of the federal online gambling ban say the law is
necessary to clarify that forms of offline gambling already considered
unlawful by state and federal laws are also prohibited in the online
context. They argue gambling has a host of negative consequences--
including addiction, bankruptcy, divorce and crime--that are only
aggravated by the relative anonymity the Internet supplies.

The law requires banks and payment processors to take certain steps
to block transactions stemming from "unlawful" forms of gambling--that
is, those that violate any federal, state or local laws. (Bets on
horse racing, lotteries, fantasy sports and games that don't involve
exchanges of anything of "value" are exempt.)

Because Congress has historically left it up to each state to decide
how much or how little gambling to legalize, it's not always clear
where online gaming for money--and poker in particular--fits in from
state to state. So, with the risk of hefty fines and criminal
penalties if they don't do their part, payment processors seem to be
playing it safe, opting to stop accepting transactions from online
poker and bridge sites even when it's not clear laws are being broken,
critics of the ban said Wednesday.

"Poker players who are in states where there is clearly no
prohibition on poker (like New Hampshire, Lederer's home state) are
being inconvenienced," Lederer said. "And that inconvenience is going
to get much worse."

Part of the controversy boils down to whether poker is considered a
game dominated by "chance" or one of "skill." The distinction is
significant because many states focus their gambling restrictions on
games dominated by chance, not skill.

Professional poker players are adamant that their game requires skill
and have cited some academics who seem to agree. Legally speaking,
however, interpretations still seem to be up in the air. For example,
a pending case in a Pennsylvania county court is dealing with the
question of whether for-profit poker tournaments (in this case, in the
offline world) are considered unlawful there. (Editors' note: We
mischaracterized the status of this case in an earlier version of this
story--key questions are still pending.)

The U.S. Department of Treasury, which is still in the early stages
of drafting the rules that will flesh out the law, made no attempt to
define more clearly what is considered "unlawful" gambling in proposed
regulations issued earlier this month. But it acknowledged that
"overblocking" by banks may occur and is soliciting comments on how to
handle that.

Online poker: An educational tool?

Meanwhile, poker players are looking for a savior in two proposed
bills that have yet to go anywhere in Congress this year.

One alternative the PPA supports is Rep. Barney Frank's (D-Mass.)
Internet Gambling Regulation and Enforcement Act, which would
substitute strict regulations, including criminal background checks
and financial disclosures imposed on companies that seek to offer
legal Internet gambling, for a blanket ban.

A narrower proposal it backs, sponsored by Rep. Robert Wexler (D-
Fla.), addresses only companies that offer "games of skill" over the
Internet--a category that includes "bridge, mahjong, backgammon and
poker" in the bill's text. Those firms would have to ensure that
minors are prevented from playing for money, that compulsive players
are flagged and referred for help, that game operators aren't
"vulnerable" to criminal or terrorist money laundering, and that
appropriate taxes are collected.

A regulated online poker regime would be far preferable because it's
easier to detect cheating and addictive behaviors that way,
professional poker player Vanessa Russo said at Wednesday's event.
"The fact that all the (sites) are logged means you can program
software to detect problem gamblers much more efficiently than you
ever could in a live way," she said.

Frank and Wexler aides both said their bosses are hoping to move
their bills to votes but are attempting to get more of their
colleagues to sign on as supporters first.

"I don't know if something is going to happen this year, but I think
within this two-year cycle, I think change could occur," Wexler
spokesman Josh Rogin told CNET News.com.

Poker enthusiasts are also attempting to ingratiate themselves with
politicians wary of the game by playing up its perceived positive
effects on everything from family life to cognitive development.

"I think poker has tremendous educational utility for kids, I think
it's a great family game," said Harvard Law School Professor Charles
Nesson, who is currently leading a project aimed at legitimizing and
teaching poker and the value of strategic poker thinking.

Nesson recently started up a group called the Global Poker Strategic
Thinking Society, which now has satellite groups at a handful of other
prestigious universities, with the goal of creating "an open online
curriculum centered on poker that will draw the brightest minds
together, both from within and outside of the conventional university
setting, to promote open education and Internet democracy."

The Internet gambling ban has also prompted a sort of "political
awakening" among poker players, said PPA president John Pappas. The
group plans to launch a voter registration drive next year with the
hopes of signing up "single issue voters" who would be willing to vote
against reelecting members of Congress who reject attempts to turn
back the antigambling law. The group is also encouraging members to
post video testimonials about the "influence of online poker on our
lives" on YouTube.

Separately, a group called the Interactive Media Entertainment &
Gaming Association, is fighting the federal gambling ban in New Jersey
federal court, arguing the rules could lead to job losses, stifle
online innovation and commerce, fail to adequately protect minors, and
trample on individual privacy rights. The judge in that case is
expected to rule later this month on whether to let the case proceed
or to grant the Justice Department's motion to dismiss it.

Perhaps more likely to get politicians moving on the issue sooner
than later, however, is the threat of trade sanctions by foreign
nations. The United States is reportedly facing the possibility of an
up to $100 billion fine from the European Union after the World Trade
Organization sided for a second time with the tiny Caribbean nation of
Antigua and Barbados, ruling that the U.S. antigambling law violates
its international treaty obligations.

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