Joe Brennan , Chairman of the Interactive Media Entertainment and Gaming Association (iMEGA)
The prospect of legalizing and regulating online poker in the United States hinges on the Federal Government’s need for new sources of revenue. To fund recent bailouts totaling nearly $1 trillion, money must be generated from both new and existing sources. The internet gambling industry, as a whole, represents a well of potential revenue. Brennan explained, “In government at all levels, there’s a great need for revenue. The interest in online poker legislation is only going to increase. The question will be whether there is enough potential tax revenue to be able to get over the opposition. I think that there is as long as it’s presented and spent wisely.” A study by PricewaterhouseCoopers estimated that the internet gambling industry could generate up to $40 billion over a 10 year period.
The regulations of the UIGEA will go into effect on January 19th, one day before President-elect Barack Obama takes office. Despite a deflated economy, the Bush Administration pushed the regulations through as part of “midnight rule-making.” Whether Obama, a poker player, will overturn them is anyone’s guess. Brennan discusses how the new rules will affect the industry in the United States: “It may be harder to move money in and out of player accounts. It may take more than one option for being able to fund accounts. It may take longer for operators to get winnings to players when they cash out. Players are going to have to be understanding towards their sites and not pile on if things should tighten up.” Compliance by the financial services industry, which includes banks and credit card operators, is required by December 1st, 2009.
Recently, Party Gaming Co-Founder Anurag Dik****, who still owns a 27% stake in the parent company of PartyPoker, admitted to violating the Wire Act of 1961. He agreed to fork over $300 million and may face up to two years in jail, although sentencing is not scheduled until 2010. On the agreement between Dik**** and U.S. authorities, Brennan commented, “I do not know what pressure was being brought. That was a pretty tough blow for online poker. That’s going to be flagged as item number one by any online poker opponent in Washington, D.C.” A dangerous precedent may also have been set in the process, as the Wire Act has traditionally only applied to online sports betting.
Meanwhile, iMEGA is awaiting its time in the Third Circuit Court of Appeals. Its three judge panel has yet to be appointed. However, Brennan shared some positive news regarding the organization’s challenge to declare the UIGEA unconstitutional, saying that he has been in talks with the Court about possible times for oral arguments. On the case, he told PocketFives.com, “The law is so vague that no reasonable person would be able to know whether or not they were in violation of it. Take the word of the Department of the Treasury, which was tasked with drafting the regulations. You wound up with regulations that are all over the map; they’ve made our argument for us. We’ve led with a strong void for vagueness argument.”
In the Spring in the United States, Brennan hinted at the possibility of poker only legislation being introduced. Considered to be the most popular of the online forms of gambling, poker appears on television screens nightly across a variety of network and cable stations. One of the great American pastimes, poker is played in kitchen tables around the country as well as by the incoming President. Brennan gave us his words of advice on how poker players can best support the push for legalization in 2009: “Keep playing. The more Americans who play the game, the more revenue that the industry generates, the more growth that the industry sees, the more leverage it will have with the U.S. Government.” Brennan noted that Government does not typically go out of its way to criminalize something practiced by millions of people
The prospect of legalizing and regulating online poker in the United States hinges on the Federal Government’s need for new sources of revenue. To fund recent bailouts totaling nearly $1 trillion, money must be generated from both new and existing sources. The internet gambling industry, as a whole, represents a well of potential revenue. Brennan explained, “In government at all levels, there’s a great need for revenue. The interest in online poker legislation is only going to increase. The question will be whether there is enough potential tax revenue to be able to get over the opposition. I think that there is as long as it’s presented and spent wisely.” A study by PricewaterhouseCoopers estimated that the internet gambling industry could generate up to $40 billion over a 10 year period.
The regulations of the UIGEA will go into effect on January 19th, one day before President-elect Barack Obama takes office. Despite a deflated economy, the Bush Administration pushed the regulations through as part of “midnight rule-making.” Whether Obama, a poker player, will overturn them is anyone’s guess. Brennan discusses how the new rules will affect the industry in the United States: “It may be harder to move money in and out of player accounts. It may take more than one option for being able to fund accounts. It may take longer for operators to get winnings to players when they cash out. Players are going to have to be understanding towards their sites and not pile on if things should tighten up.” Compliance by the financial services industry, which includes banks and credit card operators, is required by December 1st, 2009.
Recently, Party Gaming Co-Founder Anurag Dik****, who still owns a 27% stake in the parent company of PartyPoker, admitted to violating the Wire Act of 1961. He agreed to fork over $300 million and may face up to two years in jail, although sentencing is not scheduled until 2010. On the agreement between Dik**** and U.S. authorities, Brennan commented, “I do not know what pressure was being brought. That was a pretty tough blow for online poker. That’s going to be flagged as item number one by any online poker opponent in Washington, D.C.” A dangerous precedent may also have been set in the process, as the Wire Act has traditionally only applied to online sports betting.
Meanwhile, iMEGA is awaiting its time in the Third Circuit Court of Appeals. Its three judge panel has yet to be appointed. However, Brennan shared some positive news regarding the organization’s challenge to declare the UIGEA unconstitutional, saying that he has been in talks with the Court about possible times for oral arguments. On the case, he told PocketFives.com, “The law is so vague that no reasonable person would be able to know whether or not they were in violation of it. Take the word of the Department of the Treasury, which was tasked with drafting the regulations. You wound up with regulations that are all over the map; they’ve made our argument for us. We’ve led with a strong void for vagueness argument.”
In the Spring in the United States, Brennan hinted at the possibility of poker only legislation being introduced. Considered to be the most popular of the online forms of gambling, poker appears on television screens nightly across a variety of network and cable stations. One of the great American pastimes, poker is played in kitchen tables around the country as well as by the incoming President. Brennan gave us his words of advice on how poker players can best support the push for legalization in 2009: “Keep playing. The more Americans who play the game, the more revenue that the industry generates, the more growth that the industry sees, the more leverage it will have with the U.S. Government.” Brennan noted that Government does not typically go out of its way to criminalize something practiced by millions of people
