AGA Internet Gambling White Paper

The American Gaming Association recently released a white paper reaffirming their increasingly receptive attitude toward regulated online gambling in the United States.

The paper, titled “Internet Gambling: Five Years Later” outlines the current state of online gambling and establishes a case for licensing and regulation in the U.S.  According to AGA president and CEO Frank J. Fahrenkopf, the paper is just one of a number of activities planned by the AGA to ‘build a coalition of support’ for new internet gambling laws.

The full paper can be read at the AGA website, but if you can’t be bothered reading all 31 pages, the cheat notes summarizing key contentions are set out below.

1. Online gambling worldwide is becoming and activity that is increasingly legalized and regulated.  Some 85 countries presently license and regulate online gambling operators.
2. US policy toward online gambling is described as ‘schizophrenic’, with legal online bets allowed for pari-mutuel wagering and state based lotteries and a prohibition toward other forms of online betting.
3. The effectiveness of UIGEA as a prohibition mechanism is questioned, given the fact that Americans spend $4 billion annually on offshore gambling sites.
4. Worldwide there are now many working examples demonstrating that effective regulation having regard to fair games, exclusion of underage gamblers, problem gambling control and money laundering is possible.
5. The technology now exists to effectively regulate online gambling withing the US.
6. The AGA recommends the following actions from the government:
   i) reinforce measures against illegal offshore operators;
   ii) remove ambiguities associated with UIGEA and legalize and regulate online gambling activity;
   iii) ensure the regulations introduced include mechanisms to address game fairness, as well as under-age and problem gambling.

The timing of the paper’s release is significant – shortly after the ‘Black Friday’ domain seizures at FullTilt, PokerStars and Absolute Poker. Last week  another dozen or so US-facing online poker operations have been shut down.

So the first of the  AGA’s recommendations are already well and truly in full swing.  The second and third will be tougher to get over the line.

But in the absence of locally licensed options, preventing Americans from gambling online with unlicensed offshore operators is a near impossible task.  If one is shut down, they’ll just find another.  As Fahrenkopf points out:

“In fact, in the immediate aftermath of online poker’s “Black Friday,” the companies that continued to operate in the U.S. in spite of the law saw a surge in new business”