Poker News

Twas the Night Before Christmas: Poker Style

Tomorrow morning, good little boys and girls all over the world will wake up, run downstairs, and marvel at the bounty that Santa Claus has left them under the Christmas tree.  But, for online poker players in the United States, this will not be the best Christmas of all-time.  Despite making it through the House Financial Services Committee, Barney Frank’s bill that aimed to legalize and regulate internet gambling lost momentum as the year wound down.

Then, Senate Majority Leader Harry Reid was unsuccessful in getting a poker-only bill passed in the lame duck session.  Reid’s bill had some serious flaws, so many people are happy about its death, but large portion of the poker community would rather see online poker legalized and regulated than not.

What I would like to do, though, is take that disappointment and turn it into something fun.  So here you go, my poker version of Clement Clarke Moore’s (or Henry Livingston’s, depending on what you read) classic poem, “The Night Before Christmas.”

‘Twas the night before Christmas, when all through the house
iPoker was silent, no keyboard, no mouse;
The chips were stacked up on the table with care,
In hopes that St. Brunson soon would be there;
The children were nestled all snug in their beds,
While visions of “Rounders 2” danced in their heads.
And mamma in her hoodie, and I in the same,
Had just settled down for a quick heads-up game,
When out on the lawn there arose such a clatter,
I sprang from the bed to see what was the matter.
Away to the window I flew like a flash,
Tore open the shutters and threw up the sash.
I was hoping for Santa or maybe an elf,
But instead ’twas a man saving me from myself.
Logic had failed him in each word that he said,
And same for his minions wearing ties colored red,
With Arizona plates and a know-it-all smile,
I knew in a moment it must be Jon Kyl.
Following lockstep behind him, they hated our game,
And he whistled, and shouted, and called them by name:
“Now, Bachus! Now, Frist! Now, Goodlatte and Leach!
Gather ’round, come closer, remember my speech!
Online Poker is bad! It hurts our fine youth!
We must speak out against it; spread lies and untruth!”
According to them laundered funds we all hide,
And one third of students attempt suicide.
Sample size be damned, they have one guy to thank,
When he went busto in poker he done robbed a bank!
They don’t care to learn what the game is about
‘Tis the root of evil, of that there’s no doubt.
“Won’t anyone think of the children?” they say,
While lotteries pay for our schools every day.
I can watch porn, build bombs, and trade stocks on the Net,
But these fogeys don’t want me to place one little bet.
Correction! I can, in fact, still play the ponies
‘Cause the horse lobby pays Goodlatte and his cronies.
These guys, they think the game of poker’s all luck,
To that I say let’s play and see who loses a buck.
But even games of pure chance, as long as they’re fair,
Should be my business to play – why should they care?
‘Tis my money, my home, my business, my time,
So screw you for wanting it to be a crime.
I pay taxes, raise my kids, put food on the table,
I should be allowed to play from home if I’m able.
Poker is fun, ’tis a game, for some ’tis their jobs,
So just let us play in our undies like slobs.
Regulating the market is the wise move,
But apparently Kyl has something to prove.
His words sound of contempt, so proud of his work,
And filled with such crap, he’s a bit of a jerk.
And raising his finger, the middle one, with flair,
And giving a laugh, his broom took to the air.
Drunk with power, to his team gave a whistle,
Congress was adjourned; it was time for dismissal.
We didn’t win this year, but victory’s not out of sight,
Happy Christmas to all, and keep fighting the fight!

PPA: Christmas Miracle Needed for Harry Reid Online Poker Bill

On Friday, Poker Players Alliance (PPA) Executive Director John Pappas appeared on Bloomberg Television to discuss the bill legalizing and regulating online poker introduced by U.S. Senate Majority Leader Harry Reid (D-NV). On the likelihood of a bill passing before the current Congressional session expires, Pappas candidly told Bloomberg viewers, “It would really have to take a Christmas miracle at this point.” Watch now.

The four-minute segment, dubbed “The High Stakes of Internet Poker,” hit television airwaves at 11:45am ET on Friday. Pappas admitted that the window for legalized internet poker was quickly closing: “Unfortunately, I think Congress is missing an opportunity to get this done and get it done sooner than later. I think next year is really our next best venue. The vehicles this year just didn’t add up to get a bill done and there was really no way to get the bill as a standalone measure any time in the last week or so. I just don’t think there’s any way it’s going to happen now.”

Reid may have been close to adding the online poker language to the tax relief act, which was signed into law by U.S. President Barack Obama yesterday. Despite an early report from The Hill claiming that the “lame duck” Congressional session would expire on Friday, Congress was still going strong at the time of writing tackling the topic of gays in the military.

In 2011, the House of Representatives will switch to Republican control, causing pro-internet gambling members of Congress like Barney Frank (D-MA) to lose their positions of power. Frank is the Chairman of the Financial Services Committee, but Pappas expressed optimism that online poker won’t be lost in the fray: “I don’t know how any member of Congress – Republican or Democrat – can be happy with the status quo. They passed a bill in 2006 that tried to prohibit internet gambling, but it’s grown. Millions of Americans continue to play online poker and they’re doing it without any of the protections the Federal Government could provide.”

On Friday, an article by the Associated Press revealed that unemployment rates in 21 states rose month-over-month, the largest number in four months. Accordingly, Pappas told Bloomberg viewers that legalizing online poker isn’t just about generating revenue for the Federal and State Governments, it’s also about creating jobs: “The bills that have been introduced would mandate that these companies establish a presence here in the U.S. These are high-tech, high-paying jobs that internet gaming companies generate. It’s not cocktail waitresses at a casino. These are really high-tech jobs, from software security to software development as well as customer service.”

Any bill not acted upon by the end of the Congressional session is deemed dead. Besides Reid’s bill, Frank’s HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, will also fall by the wayside when the new Congress is seated in January. HR 2267 would have created a licensing and regulatory framework for the internet gambling industry sans sports betting. The Financial Services Committee approved the measure by a 2:1 margin in July, but it has not been discussed since.

On Thursday, Pappas told Poker News Daily that Reid’s bill was effectively dead. Stay tuned to PND for the latest legislative headlines.

Poker Players Alliance: Harry Reid Bill Dead

On Thursday morning, Poker Players Alliance (PPA) Executive Director John Pappas told Poker News Daily that the bill introduced by U.S. Senate Majority Leader Harry Reid (D-NV) legalizing and regulating online poker is all but dead. A move to add the bill’s language to the tax relief act currently being debated in Congress failed to come to fruition.

Pappas told Poker News Daily that a highly charged debate over the tax measure was largely to blame: “When the tax package fell through and things became much more political for it – not related to our bill – it became clear that another controversial addition to the tax bill could sink it.” Reid’s bill would have opened the online poker market in the United States to current operators like Caesars Entertainment, which owns the rights to the annual World Series of Poker.

U.S. President Barack Obama struck a deal with Republicans on the contents of the tax relief act, which perhaps closed the door to other bills being added.

Now what? With the Republican Party taking control of the House of Representatives in 2011, pro-internet gambling allies like Congressman Barney Frank (D-MA) may take a back seat. Frank, whose HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, garnered 70 co-sponsors and sailed through the House Financial Services Committee in July, will likely lose his post as Chairman. In his stead could be staunch internet gambling opponent Spencer Bachus (R-AL), whom the PPA graded an “F” in its Congressional Ratings Guide.

Looking ahead to 2011, Pappas told Poker News Daily, “The online poker bill that was floating around needs some improvement, so the PPA wants to go back to Senator Reid and talk about how we can improve on his current draft. There’s going to be a renewed focus in the Senate and we’ll be taking some of the legislation in a different direction so that’s it not focused on the Financial Services Committee, where we have a known opponent.”

Two years ago, Bachus, the current Ranking Member of the committee, erroneously quoted a study from McGill University linking internet gambling to suicide. The Alabama lawmaker asserted in a June 2008 hearing, “McGill University found that one-third – one-third – of college students who gambled on the internet ultimately attempted suicide. That is why the rate of suicide on our college campuses has doubled in the last ten years.” In fact, no such study had ever taken place.

On Wednesday night, ESPN.com published an article declaring Reid’s bill dead. Pappas told the Connecticut-based news outlet, “Sadly, some politicians remain with their heads firmly in the sand. The leadership of the Poker Players Alliance got the debate this far and we are determined to see this through.” The Hill reported that the ongoing lame duck session on Capitol Hill is scheduled to end on Friday, although reports during the week have surfaced that lawmakers may remain in Washington, DC until close to Christmas.

Last weekend, adding language legalizing and regulating online poker to a must-pass omnibus spending bill appeared to be a possibility according to Bloomberg, but Pappas explained that adding another earmark would “make things more complicated.” The Senate approved the tax relief bill on Wednesday, with the House potentially set to follow suit this afternoon.

Pappas was scheduled to tape a segment about the online poker bill with Bloomberg that will air on Friday at 11:45am ET. Pappas will speak on behalf of the 1.2 million member strong lobbying group that has become the main voice for poker players in the United States. Four years ago, the PPA stood at just 50,000 members.

Reid’s bill won’t officially be dead until the clock strikes Midnight on the 111th Congress. Pappas concluded with a silver lining: “We always knew we had a chance to pass legislation during the lame duck session, but it fell short. But, I think there’s significant momentum going forward. We’ve done a good job of convincing lawmakers that the status quo isn’t acceptable.”

Keep it tuned to Poker News Daily for the latest developments from Capitol Hill.

Vote on New Jersey Internet Gambling Bill Coming Next Week

The internet gambling industry will start next week off on the right foot if all goes as planned. On Thursday, the New Jersey Assembly Regulatory Oversight and Gaming Committee sent a bill legalizing internet versions of brick-and-mortar games to the full Assembly. On Monday, the legislative body will likely vote on the measure, which is sponsored by State Senator Raymond Lesniak.

Hard at work in the East Coast state pushing Lesniak’s legislation along is the Interactive Media Entertainment and Gaming Association (iMEGA), whose Chairman, Joe Brennan, told Poker News Daily just moments after the committee vote that other states could potentially follow New Jersey’s lead. “That’s been our intention from the beginning,” Brennan revealed. “We focused on New Jersey because of the interest of the legislature. We did not cold call New Jersey, either; we were invited to work with them on this.”

As to whether the expansion of internet gambling in New Jersey could violate Federal law in any way, an article that appeared on NorthJersey.com quoted Lesniak as saying that “by allowing online gaming only for New Jersey residents within New Jersey state lines, the state would not run afoul of federal restrictions on such gambling. He also said that an economic analysis showed that internet gambling would produce $210 million to $250 million in annual gross revenues.”

Lesniak’s bill would create the first intrastate internet gambling model in the United States, which could then be mirrored around the North American country. With legislation on a Federal level introduced by Barney Frank (D-MA) and Harry Reid (D-NV) still in limbo and the movement potentially stunted in 2011 with a Republican-controlled House of Representatives, state-by-state legalization of internet gambling may be in the cards.

Brennan told PocketFives.com that he expects Lesniak’s internet gambling measure to pass with flying colors next week: “We expect it to pass. We expect it to have pretty strong support, if not overwhelming support.” The NorthJersey.com article added that up to $30 million in annual tax revenue could be generated by legalizing web versions of land-based games. These funds would be used in part to fuel horse racing purses in the northern part of the state.

It was not clear whether debate on Lesniak’s bill would take place on Monday prior to a vote. If approved, according to Brennan, the legislation could also serve as a way to grow the technological sector of New Jersey’s economy: “This is a good way to segue into the investments that South Jersey needs to make to enjoy some of the high-tech industries that the rest of the state is home to.”

New Jersey features horse racing tracks spread across the northern part of the state and Atlantic City casinos entrenched in the south. Expansion of gambling in Pennsylvania, Delaware, and other neighboring states has been slowly eating into revenues, leading to Lesniak’s bill.

Stay tuned to Poker News Daily for the latest developments from the Garden State.

Harry Reid Online Poker Bill Still Alive

Don’t believe everything you read on the internet. On Wednesday, just hours after publishing a story claiming that legislation to legalize online poker introduced by U.S. Senate Majority Leader Harry Reid (D-NV) had been dropped, the Las Vegas Sun newspaper issued a correction. Instead, the legislation remains very much alive and may be added to the tax relief bill.

How did the Sun get it wrong, you ask? A correction published on Wednesday night read in part, “In that earlier article, Reid was quoted telling the Sun after a press conference that he would not be adding legalization of online poker to his list of objectives during the lame duck session… A spokesman for Reid said later that the Senator’s comment got muddled in the cacophony of the Senate hallways, and that online gambling is still something he’d like to see move forward.”

Poker News Daily was one of the many mainstream and poker-related media outlets that picked up on the Sun’s story. Reid’s measure to license and regulate internet poker may be added to the forthcoming tax relief bill, which may have hit a stumbling block itself on Thursday. The L.A. Times reported that Democrats had rebuffed an agreement forged between U.S. President Barack Obama and Congressional Republicans on the tax bill’s contents. What the tax bill will ultimately look like now remains to be seen.

News of the Democratic rejection of the tax cut bill sent Wall Street on a downward spiral. At the time of writing, the Dow Jones Industrial Index is down 24 points on the day, or 0.2%, after spending the majority of the morning in the black. An Associated Press story quoted internet gambling champion Barney Frank (D-MA) as predicting that “the tax cut compromise ‘will be passed by virtually all the Republicans and a minority of Democrats.’ He said he would vote against it.”

Riding the wave of news stories this week has been Poker Players Alliance (PPA) Executive Director John Pappas, who told Poker News Daily on Wednesday night, “The process has been a roller coaster. We have been fighting off all sorts of bad additions to the bill, while at the same time swallowing the bitter pill of the 15-month freeze. We are still fighting and I won’t concede that the bill is dead until the Congress adjourns.”

The 15-month freeze refers to a period following the bill’s passage during which no online poker site can service the U.S. market legally. Following the waiting period, companies with existing casino licenses can solicit U.S. customers in online poker games for two years. Then, the market will open up to everyone. The timeline means that sites like PokerStars and Full Tilt, which are the major players in the market today, may be shut out for over three years if the bill were to be passed.

Poker News Daily sought comment from Reid’s staff on whether the final tax relief package would be revealed on Thursday. However, Reid’s staff had no statement on the matter.

Coming out in strong support of Reid’s efforts on Thursday was Forbes Magazine, which published an article that read in part, “Reid’s turnaround is welcome – and long overdue. The proposed policy change makes fiscal sense. Moreover, it is not government’s proper role to dictate what activities private individuals may or may not engage in. And from a practical perspective, Reid’s proposal provides a good opportunity for Congress members from both parties to turn their stated commitment to bipartisanship into substantive change.”

According to The Hill, the lame duck session of Congress is likely to end next Friday. Keep it tuned to Poker News Daily for the latest from Capitol Hill.

Online Poker Legislation Taking Shape in U.S. Senate

According to an article that appeared in the Wall Street Journal on Friday, Senate Majority Leader Harry Reid (D-NV) may soon be bringing online poker legislation to life in the U.S. Senate. Whether the measure could pass into law before the current legislative session expires is anyone’s guess.

According to the Journal, “The Nevada casino companies pushing the measure were among [Reid’s] biggest donors during his fierce re-election fight. They argue the bill would provide consumer protection for poker players and would provide some tax revenue for federal and state governments.” Reid will return as the Senate Majority Leader in 2011 when the new Congress is seated. Then, the House of Representatives, currently controlled by Democrats, will see Republicans assume a leadership role.

In the House, Congressman Barney Frank’s (D-MA) HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, sailed out of the Financial Services Committee in July. The bill establishes a licensing and regulatory framework for internet gambling sites to solicit real money action from the United States. Even though it passed by a 2:1 margin in Committee, it has yet to be approved, or even addressed, by the full House.

Speaking out against possible online poker legislation by Reid was House Financial Services Committee Ranking Member Spencer Bachus (R-AL), who may assume the Committee’s Chair in the new year. Bachus told the Wall Street Journal, “Congress should not take advantage of the young, the weak, and the vulnerable in the name of new revenues to cover more government spending.” Curiously, Reed’s camp declined to comment to the New York news outlet.

The bill would allegedly allow “only existing casinos, horse tracks, and slot-machine makers to operate online poker websites for the first two years after the bill passes, which could limit the ability of other companies to enter the market.” If the Journal’s assessment were true, then the bill would be similar to the marked up version of HR 2267, which prohibits companies that have circumvented the Unlawful Internet Gambling Enforcement Act (UIGEA) from obtaining a license.

The UIGEA was passed in 2006 after being attached to the SAFE Port Act, an unrelated port security measure, in the waning moments of the Congressional session. Then-Senate Majority Leader Bill Frist (R-TN) pushed the UIGEA through Congress four years ago; now, the current Senate Majority Leader may undo the legislation before year’s end.

On December 1st, three Republicans – Bachus, Dave Camp (R-MI), and Lamar Smith (R-TX) – authored a letter to Reid and Senator Mitch McConnell (R-KY) urging that any attempts to legalize internet gambling be squashed.  The letter claims that approving web gaming would result in an “unprecedented new tax regime” and adds that the rumored bill represents “desperation for more tax dollars to pay for ever-increasing Federal spending.”

The Republican-backed letter also reminds readers that, four years ago, the UIGEA coasted through the House before being tacked onto the SAFE Port Act in the Senate: “It should also be noted that in 2006, the last time the whole House considered an internet gambling bill, it voted 317 to 93 to prohibit gambling online.”

The Journal notes that Caesars Entertainment, which owns the rights to the annual World Series of Poker and recently changed its name from Harrah’s Entertainment, supports the movement to legalize internet gaming. Stay tuned to Poker News Daily for the latest headlines from Capitol Hill and beyond.

Margarita Prentice to Washington Poker Players: “Let Them Go Pump Gas”

In a rather bizarre interview posted on ESPN.com, Margarita Prentice, the brains behind the law in Washington State that makes playing online poker a Class C felony, insinuated that players out of a job should “go pump gas.”

Prentice told ESPN.com’s Gary Wise, “I just think some of these arguments are utter nonsense. You mean you’re going to move so you can play poker? Gee, lots of luck in your life… I have nothing against card playing. That’s fine. If you want to do that, but I’m sure not going to worry about someone… you know. Let them go pump gas.” Prentice added that state lawmakers simply added the word “internet” into existing gambling statutes to create the harsh law four years ago.

In response to Prentice’s off-the-wall comments, Congressman Barney Frank (D-MA), internet gambling’s champion on Capitol Hill in Washington, DC, told Wise, “Wow. The intolerance of that is just appalling, but that’s the attitude that goes with the sense you have the right to dictate other people’s lives to them.” Frank introduced HR 2267 in Washington, DC, a bill that creates a comprehensive licensing and regulatory framework for internet gambling companies to solicit U.S. customers.

Poker Players Alliance (PPA) Chairman Alfonse D’Amato, a former three-term Republican Senator from New York, echoed Frank’s thoughts: “She is why people are angry, because of the arrogance of those in government who say they know what’s best for you.” In November 2009, Prentice was ironically rumored to be considering sponsoring a bill that would bring internet keno to Washington State. The Seattle Times newspaper reported her involvement, although the bill ultimately did not come to fruition.

Late last week, Full Tilt Poker blocked real money play from Washington State, following a similar decision from rival PokerStars six weeks prior. In September, the Washington State Supreme Court upheld a law that makes playing online poker a Class C felony on the grounds that it does not violate the Commerce Clause of the United States Constitution. PPA Washington State Director Lee Rousso, a lawyer by trade, brought the suit, but the state’s highest judicial body argued that the law affected in-state and out-of-state internet gambling operators equally, thus not trampling on the Commerce Clause.

Prentice also told ESPN.com that she doesn’t foresee the law having major effects on online poker players: “I’ve never really understood all of the hysterics, and all of the beefs. I just can’t see anybody who’s having any major suffering over it.”

PPA Executive Director John Pappas was taken aback by Prentice’s comments to ESPN.com. Pappas told Poker News Daily on Thursday, “It’s a complete picture of what kind of a lawmaker she is. Not only is she dismissive of an entire industry of individuals who enjoy poker, but the idea that her law is subjecting people to suffering – she’s totally ignorant of that. She refuses to see that she passed a law that’s unpopular.”

The PPA asked its members in Washington State to contact Prentice, a State Senator, “because her law affects everyone in the state. They should also contact their own members to repeal this law,” Pappas remarked. In addition, the PPA plans to work with the legislature to repeal the law in 2011. The statute was adopted in 2006 prior to the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) on the Federal level.

Online poker players in nearby states like Oregon have reported difficulties accessing Full Tilt Poker and PokerStars. In response to the former pulling out of Washington State last week, Seattle poker pro Matt Affleck Tweeted, “Sigh, Full Tilt Poker follows Stars’ lead and bans Washington State players… No idea what I’m going to do now.”

Meanwhile, the PPA continues to push Frank’s HR 2267 on Capitol Hill. Now in the “lame duck” session, Congress has been considering a number of proposals. The PPA and online poker players everywhere are keeping a watchful eye on HR 2267, which was passed out of the House Financial Services Committee in July. Pappas revealed, “There is still a lot of keen interest in getting something done and getting something passed. The biggest stumbling block we have is what the vehicle is for this bill.” HR 2267 and its tax companion bill, HR 4976, could be attached as a “pay-for” to a budget-related measure.

Read the entire ESPN.com article.

Internet Gambling’s Deficit Reduction Benefits Emphasized

On Monday, the “lame duck” session of Congress kicked off in Washington, DC. The period may mark one last hoorah for the internet gambling industry in the United States, which will see a Republican-led House of Representatives convene in January. Also this week, the Safe and Secure Internet Gambling Initiative has been touting the budgetary effects of legalizing and regulating our industry.

Information distributed by the Initiative on Tuesday explained, “A bi-partisan commission created by President Obama is currently working on a plan to help balance our nation’s budget – projected at $1.42 trillion for fiscal year 2009.  Their recommendations, due to be released by December 1st, 2010, are being crafted in part based on testimony provided by various experts and interest groups.” Licensed internet gambling, according to projections, could bring over $40 billion in much-needed tax revenue over a ten-year period.

The Initiative is asking concerned online poker players and internet gamblers alike to send an e-mail to the National Commission on Fiscal Responsibility and Reform at commission@fc.eop.gov. The bipartisan commission is tasked with creating ways to address the budget deficit, and internet gambling may be part of the solution.

Former Wyoming Senator Alan Simpson and President Bill Clinton’s Chief of Staff Erskine Bowles serve as the Co-Chairmen of the Commission, whose roster also includes six Democratic lawmakers and six Republican lawmakers. Honeywell International CEO David Cote, former Young and Rubicam Brands CEO Ann Fudge, Service Employees International Union President Andrew Stern, and former Office of Management and Budget Director Alice Rivlin also comprise the eclectic group.

Safe and Secure Internet Gambling Initiative spokesperson Michael Waxman told Poker News Daily on Wednesday, “While the Deficit Commission has many difficult decisions to make, putting to use the revenue generated through online gambling regulation should be a no-brainer.”

The Initiative has crafted a sample e-mail that can be accessed from its website that reads in part, “Given our nation’s economic challenges, it is time to replace a failed attempt at prohibition with a regulated environment that allows online gambling activity, protects consumers, and uses the much-needed new revenue generated to pay off our nation’s debt.” The letter trumpets legislation put forth by Congressmen Barney Frank (D-MA) and Jim McDermott (D-WA). Both will return to the next Congress in the New Year.

Frank’s legislation, HR 2267, has picked up 70 co-sponsors on both sides of the aisle and was rubber-stamped out of the House Financial Services Committee in July. Now, it awaits its time on the House floor. The Poker Players Alliance (PPA), Safe and Secure Internet Gambling Initiative, and other organizations have been pushing for the bill to be acted on during the “lame duck” session. The measure creates a full licensing and regulatory framework for internet gambling companies to solicit U.S. customers.

McDermott introduced HR 4976, the second incarnation of a tax companion bill to HR 2267, in April. The Washington lawmaker’s legislation allocates funds derived from licensed internet gambling to state governments as well as the Federal Government. It has not yet been passed out of the House Ways and Means Committee.

The Initiative’s sample e-mail notes that Americans continue to wager “$100 billion annually online in an underground marketplace” despite laws like the Unlawful Internet Gambling Enforcement Act (UIGEA), which was attached to an unrelated port security bill and passed in 2006. HR 2267 and its tax companion may ultimately be pushed through the current Congress in a similar manner and attached as “pay-for” bills to must-pass legislation.

The Initiative’s endorsers include the UC Group, Baker Tilly, eCOGRA, Secure Trading, the Remote Gambling Association, GamCare, and the European Gaming and Betting Association.

Poker Players Alliance Welcomes New Board Member

On Monday, the Poker Players Alliance (PPA), the 1.2 million member strong lobbying voice for poker players in the United States, welcomed a new Board member into its ranks. Patrick “Skallagrim” Fleming, who manages the PPA’s Litigation Network, will bring insight to the Board as the organization heads into 2011.

PPA Chairman Alfonse D’Amato commented in a press release sent by the lobbying organization on Monday, “Patrick is one of the poker community’s staunchest champions, donating his time and legal expertise to help PPA members navigate the often murky waters regarding poker’s legal status. I am so pleased that he will be joining the Board of Directors as we work together to guide the organization’s efforts to provide a safe, regulated environment for poker players in the U.S.”

Fleming is an attorney by trade and, according to the same press release, got his start in the organization following the passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) in 2006: “Dismayed at the government’s effort to restrict his right to play online poker by passing the UIGEA, Fleming joined the PPA and began leveraging his legal expertise to post about legal challenges on various poker forums.” Two years ago, Fleming pitched the idea of a Litigation Network, which matches online poker players needing legal assistance with pre-screened local counsel.

PPA Executive Director John Pappas is also looking forward to welcoming Fleming into the fold: “Without Patrick’s guidance and expertise, the PPA would not be nearly as well positioned from a legal perspective to provide support and testimony in the legal cases impacting poker across the nation… It is a true pleasure to work with Patrick and I look forward to the ideas and insights I am certain he will bring in his role on the Board of Directors.”

Fleming’s compatriots on the PPA’s Board of Directors include D’Amato, Pappas, former World Series of Poker (WSOP) Main Event champ Chris Ferguson, Women in Poker Hall of Famer Linda Johnson, Full Tilt Poker front man Howard Lederer, 2004 Main Event champ Greg Raymer, and PPA Kentucky State Director Rich “TheEngineer” Muny.

Fleming hails from New Hampshire and will join the Board of an organization that continues to press for licensed and regulated online poker in the United States. The PPA is in the midst of pushing Congressman Barney Frank’s (D-MA) HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, which was marked up by the House Financial Services Committee in July. HR 2267 sports 70 co-sponsors on both sides of the aisle, but will be deemed “dead” if not acted on by the end of the current Congress in January.

The PPA’s Litigation Network has been instrumental in arguing poker cases in states like South Carolina and Pennsylvania. Pappas posted on TwoPlusTwo that Fleming was in the midst of attending a charity event in his home state of New Hampshire: “I actually have the privilege of being with Skall at this very moment. We are in Plaistow, NH at the Granite State Poker room for a charity event. New Hampshire native Howard Lederer will be here too, as well as special guest Congressman Paul Hodes, who is running for the U.S. Senate.” Hodes is running against former New Hampshire Attorney General Kelly Ayotte, who signed a letter opposing internet gambling legislation in 2007.

The PPA recently released its 2010 Congressional Ratings Guide in advance of next week’s general elections in the United States. The organization assigned letter grades to each Congressman running to give players guidance on who to vote for. In addition, Poker PAC, the PPA’s political action committee, recently announced endorsements of 58 lawmakers. Visit ThePPA.org for more information.

Poker PAC Endorsing 58 Lawmakers in U.S. Elections

On Thursday, the Poker Players Alliance (PPA), the major lobbying voice for poker players in the United States, released a list of 58 Congressman that its Poker Political Action Committee (PokerPAC) is endorsing in the general elections next month. The list includes incumbents and non-incumbents alike and consists of both Democrats and Republicans.

Former Senator Alfonse D’Amato and former Congressman Toby Moffett, the Chairmen of the PokerPAC, commented in a press release distributed by the PPA, “Through the efforts of the Poker Players Alliance and its members, more and more of our elected officials in Congress are seeing the value of establishing a safe, regulated market for online poker. This year’s election is critical to ensuring that candidates are elected who support the rights of poker players and who choose to take action to protect American consumers.”

The PAC’s endorsement of a lawmaker is primarily based on their support of pro-poker legislation in Congress. Bills favorable to internet poker like Congressman Barney Frank’s (D-MA) HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, lie dormant as the Congress turns over to 2011. The House Financial Services Committee approved HR 2267 in July. However, the bill has not yet been discussed on the floor of the House of Representatives and will be deemed “dead” if it is not acted on before the new Congress is seated in January.

Frank’s name is on the list of 58 Congressmen endorsed by PokerPAC. Others include familiar faces like Shelley Berkley (D-NV), a co-sponsor of HR 2267 who once proposed a bill to study the industry in detail. Also on the list is Congressman Jim McDermott (D-WA). The Washington Congressman’s HR 2268 serves as the tax companion bill to HR 2267. Ironically, it is a Class C felony to play online poker on McDermott’s home turf due to a law that the Washington State Supreme Court recently upheld.

Republicans like Ron Paul (R-TX), Peter King (R-NY), and Pete Sessions (R-TX), whose names have popped up several times since the Unlawful Internet Gambling Enforcement Act (UIGEA) was signed into law four years ago, are also endorsed by PokerPAC. In 2008, Sessions introduced a bill to clarify the UIGEA, but the PPA came out against it due to language asserting that there had been a “lack of authoritative court decisions on the applicability of other federal criminal statutes to internet poker and casino-style gambling.” Nevertheless, PokerPAC has its full weight behind the Texan this year.

General elections in the United States will take place on November 2nd. The entire House of Representatives and one-third of the Senate will be up for grabs. In the mid-term elections, the vote is expected to lean heavily towards Republicans. Here are the 58 Congressmen endorsed by PokerPAC:

John Adler (D-NJ)
Robert Andrews (D-NJ)
Joe Barton (R-TX)
Shelley Berkley (D-NV)
Michael Bennet (D-CO)
Judy Biggert     (R-IL)
Earl Blumenauer (D-OR)
John Callahan (D-PA)
John Campbell (R-CA)
Russ Carnahan (D-MO)
Lacy Clay (D-MO)
Steve Cohen (D-TN)
John Conyers (D-MI)
Joe Courtney (D-CT)
Steve Driehaus (D-OH)
Barney Frank (D-MA)
Joe Garcia (D-FL)
Jim Gerlach (R-PA)
Alan Grayson (D-FL)
Alcee Hastings (D-FL)
Dean Heller (R-NV)
Jim Himes (D-CT)
Paul Hodes (D-NH)
Steve Israel (D-NY)
Darrell Issa (R-CA)
Paul Kanjorski (D-PA)
Peter King (R-NY)
Mary Jo Kilroy (D-OH)
Suzanne Kosmas (D-FL)
Leonard Lance (R-NJ)
John Larson (D-CT)
Christopher Lee (R-NY)
Frank LoBiondo (R-NJ)
Connie Mack (R-FL)
Dan Maffei (D-NY)
Kenny Marchant (R-TX)
Betsy Markey (D-CO)
Jim McDermott (D-WA)
George Miller (D-CA)
Walt Minnick (D-ID)
Jim Moran (D-VA)
Christopher Murphy (D-CT)
Scott Murphy (D-NY)
Ron Paul (R-TX)
Ed Perlmutter (D-CO)
Tom Perriello (D-VA)
Gary Peters (D-MI)
Jared Polis (D-CO)
Harry Reid (D-NV)
Linda Sanchez (D-CA)
Adam Schiff (D-CA)
Robert Scott (D-VA)
Pete Sessions (R-TX)
Bennie Thompson (D-MS)
Dina Titus (D-NV)
Mel Watt (D-NC)
Anthony Weiner (D-NY)
Lynn Westmoreland (R-GA)

Callahan and Garcia, who are running in Pennsylvania and Florida, respectively, are not incumbents, while the other 56 are currently in office. The PPA has also released a full-blown Congressional Ratings Guide that grades each lawmaker on Capitol Hill based on their support of poker legislation.

New York Times Article Notes Casinos Warming To Regulated Online Gaming

An article in the Sunday edition of the New York Times notes that the land-based casino industry, for quite some time a vehement opponent to legalized online gaming and poker, is beginning to warm to the idea.

The article, written by Barry Meier, inaccurately points out that online gaming and poker are illegal (the Unlawful Internet Gambling Enforcement Act, or UIGEA, only made financing an online account an actionable offense), but it does bring to light that many in the casino world are now open to the idea of legalized online gambling. After initially seeing it as a threat to their bottom line, Meier now notes that several companies’ concerns are beginning to thaw in the current economic landscape.

Meier’s article points out that, as recently as the end of 2009, the American Gaming Association (AGA) – the organization that counts such casino operations as Harrah’s Entertainment, MGM Resorts, and Wynn Resorts, among others – was in opposition to the idea of a legalized online gaming industry. That mood changed this spring, when the AGA changed its stance after the markup of Massachusetts Representative Barney Frank’s proposed bill to regulate the online gaming industry (HR 2267). After getting concessions from Frank, including a ban on those that had violated the UIGEA from being active in the online gaming market in the United States, the AGA reversed its stance and supported a regulated industry.

In his article, Meier points out the often contentious debate that has existed among those in the “brick and mortar” casino industry. Meier correctly states that some, such as Harrah’s, have actively lobbied for a regulated online gaming industry while investing heavily in such activities overseas. On the other side, Wynn Resorts has continually stated that it is against the regulatory idea, believing that it couldn’t be adequately policed. Meier asks those in charge at Wynn for a current stance on the issue. “Wynn Resorts monitors any legislative activity, federal or state, that pertains to our industry,” Meier reports was the reply. “We make judgments after such legislation is passed.”

The reason for the change of heart among those in the casino industry may be due to online poker being the main driver behind the regulatory actions. Meier points out in his article that poker in the casinos only amounts to 2% of the activity in a land-based gaming operation. If regulation were to only be for online poker, it is thought that the casino industry would not view that as a threat to their operations. If the possibility of full fledged online casinos came into play, however, there is a chance that the casino industry could have some issues with legalization and regulation.

Another possibility for the AGA’s change of stance could be the revenues generated by online poker. Meier points out in the article the results of a study by Poker Analytics, a consulting firm in New York, that says the online industry’s biggest player, PokerStars, brings in over $1 billion per year. Add to that the other U.S. facing operations such as Full Tilt Poker, the CEREUS Network, and the Cake Poker Network (among others) and it is conceivable that online poker revenues could approach up to $5 billion per year, generating tremendous revenues through regulation and taxation. All of the above noted operations, however, have been actively courting American poker players during the life of the UIGEA and may be excluded as the current legislation is written.

Currently, the push for regulation may be on life support. Frank has stated he is “not optimistic” about the passage of HR 2267, as the bill has yet to come to a vote on the House floor. With the Congress in recess until after the midterm elections in November, the issue will not be looked at until the “lame duck” session. Even if it is passed out of the House, Frank’s bill lacks the taxation legislation covered by fellow Congressman Jim McDermott’s HR 2268 and also lacks a companion bill ready for a vote in the Senate, although Senator Robert Menendez has a bill in committee. If the legislation doesn’t move through the Congress during the “lame duck” session, the bill would die when the new Congress is seated in January.

PND Weekly News Update

Welcome to the Poker News Daily Weekly Update. I’m your host, Sean Gibson and you might notice that I’m wearing some CardRunners gear here. Well, this is me fulfilling my end of the bargain for my prop bet match against Cardrunners pro Taylor Caby. If you haven’t watched the match, check it out in our videos section!

Our lead story this week comes from PokerStars, who dealt its fifty billionth hand with a user by the name of “tbvle” able to parlay pocket queens into a massive payday. It was most assuredly his lucky day, as he played at a table with nickel big blinds and got a payout of fifty-six thousand dollars and a WCOOP Main Event seat. In total, the single hand awarded over seventy thousand dollars to six players plus thirty-one thousand dollars’ worth of WCOOP tickets. Not too shabby.

PokerStars pros like Jason Mercier, Lex Vehduis, and Ville Wahlbeck descended on the table to extend their heartfelt congratulations to the players involved. By the way, the WCOOP Main Event comes your way this Sunday on PokerStars. Don’t miss out!

Congressman Barney Frank was quoted in the Washington D.C. news outlet The Hill as saying that he’s not optimistic about legislation legalizing and regulating online poker passing before the November elections. Frank told The Hill that he “doesn’t have a commitment from House leadership officials that they would move the bill before the lame duck session.”

Therefore, HR 2267 may ultimately be attached to a piece of must-pass legislation in the lame duck session following elections. Safe and Secure Internet Gambling Initiative spokesperson Michael Waxman told The Hill, “The greatest odds for online gambling regulation legislation to be approved this year are for it to get done as part of a larger legislative package, primarily because of the opportunity to dedicate the considerable new revenue generated as an offset for another program or need…This is one of the few issues where broad support can be found on both sides of the aisle.”

Turning to live tournament news, Phil Laak, Jeffrey Lisandro, and Scott Shelley all took down bracelets in World Series of Poker Europe events in recent days. Shelly won a one thousand Pound No Limit Hold’em event and collected over one hundred thirty thousand Pounds. He bested a field of over five hundred players and outlasted J.P. Kelly heads-up. Kelly won the same tournament last year and fell oh-so-short in his title defense this time around. Kelly, who is twenty-four years old, was also gunning to become the youngest player to win three bracelets. The current record-holder in that department is Phil Ivey, who was twenty-six when he won his third gold bracelet.

California State Senator Rod Wright has been indicted on eight counts, including “false declaration of candidacy, voter fraud, and perjury beginning in two thousand seven, when he changed his voter registration to run for the legislature,” according to the Los Angeles Times. Officials allege that Wright did not live in the district he represented.

What’s the significance of Wright’s indictment for poker players? He has been one of the driving forces behind bringing intrastate online poker to California, which would be the first state to do so. California is facing a sizable budget deficit, leading to a search for new revenue. Wright introduced Senate Bill One-Four-Eight-Five to bring online poker to life and, as recently as September Third, the Poker Voters of America released amendments to further the bill’s chances of becoming law. Whether Wright will have to give up his California State Senate seat remains to be seen.

On Sunday, the PokerStars Million Dollar Challenge will continue its Season Two run. The first challenger of the new season was Jessica Cupini, a single mom attending West Virginia University who is an aspiring law school student. Cupini’s first round celebrity challenger was “Dancing with the Stars” host Brooke Burke. She easily dispatched of Burke before facing off against reigning WPT Championship winner David Williams.
Cupini ultimately defeated Williams and went on to face Daniel Negreanu heads-up for one hundred thousand dollars. However, she errantly bluffed all-in with Ace-Four on a board of Jack-Ten-Nine-Eight. Negreanu insta-called with Queen-Six for a straight and that was all she wrote for the show’s first challenger last weekend. You can catch the PokerStars Million Dollar Challenge before or after NFL football on Fox.

In an exclusive interview with Poker News Daily, Commerce Casino CEO HaigPapaian gave his take on Barney Frank’s HR 2267. Papaian clarified his casino’s position on the bill, telling us,

“We’re going to do everything we can to ensure it doesn’t become law. We’re not against online poker; we only want legalized online poker. We also have an issue with offshore companies coming in and taking over the industry. As President of the Commerce, I am part of a group of card clubs and tribes that are for poker-only bills in the state of California. For the [Poker Players Alliance] to say that we’re against online poker – that’s ridiculous.”

On Tuesday on ESPN, Phil “OMGClayAiken” Galfond took his seat at the feature table for Day Five of the World Series of Poker Main Event. At the start of the two one-hour episodes, five-hundred seventy-four players remained, including two former champs, Scotty Nguyen and Johnny Chan. The bust outs were fast and furious and included Jason Mercier, Adam Schoenfeld, Donny Mizrachi, and Steve Sanders.

Nguyen was crippled after running two pair into James Carroll’s boat. Then, the Poker Hall of Fame nominee committed the rest of his chips pre-flop with Ace-Jack of spades, but ran into pocket kings to bust in two hundred ninth. New episodes of the WSOP on ESPN air every Tuesday at Nine P-M Eastern Time.

Last, but certainly not least, the record books were re-written last weekend, as one thousand forty-two players turned out for the World Poker Tour’s Borgata Poker Open in Atlantic City. The four-figure attendance marked the largest WPT field ever assembled. Last year, the tournament, which sports a thirty-five hundred dollar buy-in, drew one thousand eighteen players, meaning that attendance this year was up two percent.

WPT commentator Mike Sexton made a deep run in the Borgata Poker Open, finishing twentieth for fifteen thousand dollars. Also making waves was John D’Agostino, who took fourteenth place for his first WPT in the money finish in three years. Welcome back, John!

Well that does it for this week’s top headlines here at Poker News Daily. Be sure to visit us every day for the latest poker news, interviews and features. Also be sure to add us to your twitter feed at twitter dot com slash poker news daily. I’m Sean Gibson, hoping one of our readers takes down that WCOOP Main Event! I’ll see you next time.

Rep. Barney Frank “Not Optimistic” About Passage Of HR 2267 Before Elections

Democratic Representative Barney Frank, the Massachusetts Congressman who has been pushing for the legalization and regulation of online gaming in the United States, has stated in an interview that he is “not optimistic” regarding the passage of his legislation prior to the 2010 midterm elections.

The bill known as HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, is the subject of an article on the website The Hill written by Kevin Bogardus. Frank, who has been at the forefront of pushing the legislation through his chairmanship of the House Financial Services Committee, notes that the legislative agenda for the final couple of weeks of the current Congress is quite busy. This, Bogardus reports, is causing him to have some troubles in putting the bill to a vote on the House of Representatives floor.

Because of the current backlog of legislation, Bogardus states that Frank “doesn’t have a commitment from House leadership officials that they would move the bill before the lame duck session.” Causing further issues for any movement on HR 2267 is the lack of a companion bill in the U.S. Senate. While Senator Robert Menendez, a Democratic senator from New Jersey, has introduced a companion bill called S 1597 (the Internet Poker and Game of Skill Regulation, Consumer Protection, and Enforcement Act of 2009), he has not been able to garner any co-sponsorship from his fellow Senators.

Another complication for Frank’s legislation is the delay in passage of its companion bill covering the taxation issues. The companion piece for HR 2267, Representative Jim McDermott’s (D-WA) Internet Gambling Regulation and Tax Enforcement Act of 2009 (HR 2268), hasn’t come for a vote of the House Ways and Means Committee, meaning that, while Frank’s bill would regulate the industry, there aren’t any guidelines on how to tax it.

With the scheduled date for adjournment of the current Congress set for October 8th, Bogardus notes that if HR 2267 does not come to the floor prior to the adjournment, it may be a part of a short “lame duck” session that will take place before the new Congress is seated in January. If HR 2267 comes to the floor during this lame duck session, a Democratic Senate aide is quoted by Bogardus, there will be “a small chance” that it would be attached to a jobs bill that would ensure passage, much like the previous Congress did in passage of the Unlawful Internet Gambling Enforcement Act (UIGEA) in 2006.

Bogardus cites a statement from Michael Waxman, the chairman of the Safe and Secure Internet Gambling Initiative and a supporter of Frank’s legislation, regarding the likelihood of the tack on method being used. Bogardus quotes Waxman as saying, “The greatest odds for online gambling regulation legislation to be approved this year are for it to get done as part of a larger legislative package, primarily because of the opportunity to dedicate the considerable new revenue generated as an offset for another program or need.” In the article, Waxman also cites the bipartisan nature of HR 2267, noting, “This is one of the few issues where broad support can be found on both sides of the aisle.”

As recently as August, Frank was confident that HR 2267 would pass during the current legislative period. After markup in the House Financial Services Committee, the bill was passed out of committee by a 41-22 margin. The bill has 70 co-sponsors in the House of Representatives, including 2008 Republican presidential candidate Ron Paul and Democratic Nevada Representative Shelley Berkley, among others.

If HR 2267, and any of its companion legislation in either the House or the Senate, is not enacted prior to the end of the current Congress, then the bill will die. Legislation proposed during a run of a particular two-year Congressional schedule does not carry over to the next Congress. The November 2nd elections are expected to be a battleground during the 2010 midterm elections, with the Democratic-controlled Congress in danger of losing either one or both of the legislative bodies (the Senate and/or the House) to Republican control.

Commerce Casino CEO Haig Papaian Comments on Internet Gambling Bill

Taking center stage in recent weeks has been the squabble between a coalition of California casinos and the Poker Players Alliance (PPA) over the merits of HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act. Poker News Daily sat down with Commerce Casino CEO, President, and Chairman of the Board Haig Papaian to see what’s fueled the debate.

Poker News Daily: Thanks for joining us. Give us your official standpoint on HR 2267.

Haig Papaian: We’re going to do everything we can to ensure it doesn’t become law. We’re not against online poker; we only want legalized online poker. We also have an issue with offshore companies coming in and taking over the industry. As President of the Commerce, I am part of a group of card clubs and tribes that are for poker-only bills in the state of California. For the PPA to say that we’re against online poker – that’s ridiculous.

I don’t think there’s another industry in the state of California that is more regulated than the card clubs and tribal casinos. To have this bill be on a countrywide basis and relax those standards is upsetting. We’ve been playing by the rules since Day 1.

PND: Can you talk about some of the shortcomings of the bill?

Haig Papaian: In California, we’re under a magnifying glass from the Department of Justice. If we don’t comply with them, we will lose our license and be out of business. I don’t see those strict regulations in the Federal bill. You’re dealing with offshore entities and I want to see how they’ll regulate companies located in the Isle of Man. The internet gambling sites will set up shell companies to say they have people working here to comply with HR 2267, but the money will still go out of the country.

PND: Is California the main focus of the Commerce Casino and the other gambling establishments then?

Haig Papaian: California is my primary concern. We’re going to push to get something done here this year. California is first and foremost and what is generated from California should stay in California. It still irritates me that 40% of Las Vegas’ budget comes from California players.

PND: Have you seen any ill effects from the PPA’s Players Before Profits petition?

Haig Papaian: It’s not affecting our business.

PND: Where do you stand on HR 4976, the tax companion bill to Congressman Barney Frank’s HR 2267?

Haig Papaian: From my understanding, that tax scheme is far less than what the states could receive if they passed their own bills. Any state that chooses to do it should have their own intrastate internet gambling bill so they can keep the majority of their own money. The Federal Government has never been involved in gaming and I don’t see why they should start now.

PND: Do you support the provision in HR 2267 that says internet gambling sites currently serving the U.S. market won’t be able to obtain a license?

Haig Papaian: The Federal Government says they shouldn’t be doing it now and they’re doing it anyway. When Prohibition was lifted, was Al Capone allowed to start a brewery? No. These guys are doing something illegally and I have a problem with rewarding them later.

PND: Given the economic downturn, how has business been going at the Commerce?

Haig Papaian: Business is down, but we’re holding our own. Our tournament numbers are down. We’re probably 7% to 8% off from where we were, which doesn’t sound like a lot, but it is. We have a similar head count in cash games as we did before, but instead of people getting into larger games, they’re playing smaller ones, so we get a smaller rake. I am proud of the people who work underneath me here because we didn’t have any major layoffs and we’re still running straight.

PND: We saw that you have an option for poker players to bring their home games to the Commerce. Has that been popular?

Haig Papaian: It’s been pretty successful. People who don’t want to deal with the mess of hosting their own home game can come here. We have drinks and food for everyone and we’ll even drive you home if you need to.

Goldwater Bank Forfeits Funds Tied to Online Gambling

Goldwater Bank in Scottsdale, Arizona has agreed to forfeit $734,000 in assets tied to money laundering and illegal online gambling operations, the FBI said on Friday. The one-branch bank was accused of transferring funds for several online gambling sites, including PokerStars, the world’s largest online poker room. At least $13 million was transferred in the first half of 2009 according to federal reports.

Ahmad Khawaja, together with his two firms, Allied Systems and Allied Wallet, had reportedly been actively involved in the transfer of funds to players from sites such as PokerStars and deposited funds into an account at Goldwater. The companies reportedly transferred money from outside of the U.S. through wire transfers from people who understood that the money was being exchanged as part of the gambling operation.

Following a civil forfeiture complaint by the U.S. Government, Goldwater Bank agreed to hand over the funds to resolve claims that the money was traceable to assets involved in money laundering and proceeds of an illegal online gambling business. Under the Unlawful Internet Gambling Enforcement Act (UIGEA), financial institutions aren’t permitted to process transactions associated with illegal online gambling. Goldwater Bank, however, denied any knowledge that the transactions had ties to offshore gambling sites.

“Although Goldwater Bank denies guilty knowledge of its role in facilitating an illegal online gambling business, it was paid to execute transactions that were essential to the operation of this criminal enterprise,” said Janice Fedarcyk, the FBI’s Assistant Director in charge, in a statement. “The forfeiture settlement means the bank won’t profit by providing this service.”

Goldwater was among a handful of Arizona-based banks that received Troubled Asset Relief Program (TARP) funding. The program, which was signed into law by President George W. Bush in October 2008, invested federal money into banks in order to ultimately strengthen the financial sector. Should an investigation reveal that the bank was conscious of the gambling-related transactions, it could be in danger of losing funding in the future.

“Today’s charges and settlement should send a powerful message to TARP recipients that they will be held strictly accountable for any misdeeds while they stand as custodians of taxpayer dollars,” said TARP Special Inspector General Neil Barofsky. “SIGTARP commends the leadership of the U.S. Attorney for the Southern District of New York for his continued use of both civil and criminal remedies to protect taxpayer interests.”

In August, Khawaja and his two companies reached a civil settlement with the U.S. Government, agreeing to forfeit $13.3 million that was deposited between January 2009 and May 2009 at Goldwater Bank. The FBI confiscated all $13.3 million at the bank in June 2009 and Khawaja settled to keep himself and his companies out of further legal trouble.

Payment processors like Khawaja’s are being watched even more closely since the UIGEA’s regulations went into effect in June. The law, passed in 2006, aims to stop online gambling by preventing credit card companies and banks from processing funds transfers for unlawful internet gambling. The fight to regulate online poker in the U.S. took a big step in July with the passage of Barney Frank’s HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act. However, there’s still a long climb ahead in order to turn the bill into a law, leaving sites like PokerStars alarmed in the interim.

Stay tuned to Poker News Daily for further details.

Poker Voters of America Weighs in on California Intrastate Online Poker

One of the organizations at the forefront of the movement to bring legalized intrastate online poker to states like California is the Poker Voters of America, or PVA. Recently, Poker News Daily caught up with PVA Executive Director Melanie Brenner to assess the odds of regulated gaming coming to the massive West Coast state.

Poker News Daily: Thanks for joining us. Tell us where we stand with regards to bringing intrastate online poker or internet gambling to California. We understand that State Senator Rod Wright had introduced SB 1485, but the bill stalled on its way to becoming law earlier this year.

Melanie Brenner: The California legislature’s session has ended, but we don’t have a budget yet, so they will be coming back to deal with those issues. When Senator Rod Wright had his hearing, it became clear that there wasn’t the broad support in California that we hoped there would be, so the PVA got actively involved in meeting with major stakeholders, listening to their concerns, and getting feedback.

The initial legislation from the year before, the Morongo bill, called for a single hub they were going to run. We met with them and said that there’s no way that California or any state would legislate to give a contract to one provider. It’s also not good for the game.

Based on meetings with the Morongo tribe, Southern California card rooms, and smaller Indian tribes, we came up with proposed amendments to Wright’s bill in the hopes that we can all get together in a meeting and see if we can come to an agreement.

PND: What were some of the proposed amendments to Wright’s bill? We understand that organizations like the Poker Players Alliance (PPA) took issue with the bill only calling for three internet gambling hubs.

Melanie Brenner: One of the very big issues for the tribes was the scope of the games. What they don’t want to see is this passed and then it becomes full online casino gaming. The amendment calls for non-banked games, which was language they were comfortable with.

One of the other amendments was about the number of hubs. It was initially at three hubs and we expanded it to five with 20-year contracts and reassessment after five years. The biggest addition was a mitigation fund. There’s a chance for everyone in California to make something. Part of the money the state collects is set aside and all tribes get a little piece of that.

PND: The Bicycle Casino, Hawaiian Gardens, Hollywood Park, and Commerce Casino have come out against HR 2267, Congressman Barney Frank’s bill legalizing and regulating online gambling in the United States on a Federal level. Give us your take on what the Southern California casinos are looking for.

Melanie Brenner: They are looking at how they play in this new arena. The reality that they are not going to own this has become very clear. It’s not good for the system and one of the things I cautioned them is that they’re trying to create a system that will fail. When we’re looking to pass this in other states, the last thing we need is a system that doesn’t work as a model. We’d oppose any legislation that provided a sole source contract.

PND: Talk about the importance of providing player protections online and how those differ from what’s found in brick-and-mortar casinos.

Melanie Brenner: A regulated system is going to give you better player protections than what we have now online and better than what you’d find in a land-based casino. If someone in a land-based casino tells a manger they got ripped off, what’s the method for following up? Online, the data is all there. You can go back, reevaluate, and see if there’s a problem. That’s a big selling point for us when we’re explaining this to people.

PND: What will be the first state in the Union to offer intrastate online poker?

Melanie Brenner: I’m still betting on California. I’m saying that because we have a budget deficit, the legislature has to come up with some revenue, and we’re one of the few sources out there. We’ve made big steps over the last six to eight weeks meting with big stakeholders in California to get them involved.

PND: Describe the tribal influence in the decision-making process in California.

Melanie Brenner: California has 91 card rooms and over 100 Indian tribes. We know we couldn’t pass this legislation without tribal support. If you look back to the Morongo tribe’s initial legislation, I was so excited that I was going to send them a case of champagne. The tribes were actually standing up and saying that they wanted this.

We are showing them a great way to increase revenues without a big capital outlay. In all of my presentations, I say that if you are a business today without an online component in your business plan, I strongly suggest you work on your exit strategy.

PND: News hit the industry this week that the Atlantis Internet Group is teaming with Indian tribes to bring a limited form of interstate online poker to life. Even though it’s on a very small scale, it has to be a monumental development.

Melanie Brenner: I love seeing things like that because it shows me that the mindset is moving to where people are figuring out how to incorporate the internet. However, the whole idea of playing online is that you’re playing at home. Why would I want to get dressed and go to a casino to play online? It’s good from a policy standpoint, but is it something that’s going to change the business? No.

European Court Rules German Gambling Monopolies Unlawful

The European Union’s highest court ruled this week that Germany’s attempts to protect state-run gambling monopolies are unlawful. German regulations currently state that lotteries and sports betting are offered exclusively by state-controlled monopolies. However, the European Court of Justice said Wednesday that the rules for the German state betting monopolies were not “consistent and systemic enough” to uphold the argument that restrictions served to protect the public from gambling addiction.

“The German rules on sporting bets constitute a restriction on the freedom to provide services and the freedom of establishment,” stated the Court’s ruling. “The public monopoly of the organization of sporting bets and lotteries in Germany does not pursue the objective of combating the dangers of gambling in a consistent and systemic manner.”

In its ruling, the court said the German monopoly advertised radically to lure customers, essentially damaging the argument of the states that their monopolies limited addiction. State gambling monopolies are only permitted to operate if they meet certain guidelines, and the European Court of Justice found this particular instance to be illegal.

“In such circumstances, the preventive objective of that monopoly can no longer be pursued, so that the monopoly ceases to be justifiable,” the court said.

The result of this week’s ruling could lead to new gambling regulations in Germany that could effectively wipe out state-run gambling monopolies. But the Deutscher Lotto und Totoblock (DLTB), which operates the German Lottery, feels differently. The organization believes Germany could comply with the court’s decision by imposing tougher restrictions on automated gambling machines.

“The European court has made it clear that E.U. member states can decide whether they want a commercial model or a state-authorized model governed by the public interest,” said Erwin Horak, chairman of the DLTB.

Online gambling is still officially banned in Germany, but it produced an estimated €1 billion in annual revenue for offshore operators that take bets or provide online gaming in the country, according to marketing firm Goldmedia. The firm says that the total has been rising at an annual rate of about 30%, leading to a decline in revenue for the state-run gambling companies.

Many Europeans nations like Italy and France have already done away with betting monopolies in favor of licensed regulation. In April, the French Parliament passed a bill to legalize and regulate online poker, sports betting, and horse racing, putting an end to the state monopoly on online gambling. This allowed privately owned international websites such as PokerStars, Everest Poker, and Full Tilt Poker to offer platforms in the flourishing French market.

Meanwhile, the United States waits patiently for the next step in its own online poker regulation after the passage of HR 2267 in July. The bill received over a dozen amendments during the markup phase and now awaits its time on the House floor. Congressman Barney Frank hopes to move the bill simultaneously with its revenue companion in the Ways and Means Committee (HR 4976) later this month. Congress was on summer recess until September 10th.

Players Before Profits Petition Nears 10,000 Signatures

In late August, the Poker Players Alliance (PPA), the main lobbying voice for poker players in the United States, struck back at the Commerce Casino and other gambling establishments in California by launching PlayersBeforeProfits.com. The online petition was designed to encourage support of HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act. Now, the vehicle is nearing 10,000 signatures.

At the time of writing, the petition at PlayersBeforeProfits.com has garnered 9,018 signatures, having passed 9,000 during the day on Friday. In addition to a wealth of “Average Joes” signing it, a plethora of pros have joined in the fray. Players like Patrik Antonius, Doyle Brunson, Tom Dwan, Barry Greenstein, John Juanda, Huck Seed, and Erik Seidel have all lent their name to the PPA’s cause.

Tom Malkasian, who introduced himself in a July House Financial Services Committee hearing as an “owner, board member, and the Director of Strategic Planning for the Commerce Casino,” came out in strong opposition to HR 2267. Malkasian called the bill, introduced by Congressman Barney Frank (D-MA) “fundamentally flawed and unsound.”

Malkasian added that HR 2267 and its revenue counterpart, HR 4976, are “based on false revenue assumptions that would require the removal of the right of any state or tribe to opt out of the bill in order to achieve the advertised tax revenues of $42 billion over 10 years.” HR 4976, introduced by Congressman Jim McDermott (D-WA), has yet to be marked up in the House Ways and Means Committee. Contrastingly, the House Financial Services Committee approved HR 2267 six weeks ago and the bill boasts 70 co-sponsors.

PPA Executive Director John Pappas told the PocketFives.com Podcast this week that the California casinos are merely seeking a monopoly by opposing HR 2267: “When you peel back the onion, you realize that they’re not opposed to internet gaming; they just want a monopoly on it. From a consumer perspective, we all know that monopolies don’t work and they don’t provide the best player experience. What Commerce is looking for is a poker-only bill that will only serve the California marketplace.”

PlayersBeforeProfits.com also provides avenues for concerned Americans to Tweet, call, and e-mail the Commerce with one click. Its petition reminds casino officials, “It is important to note that with the rise of online poker, many individuals hone their skills online before they enter establishments such as the Commerce Casino – increasing traffic to poker rooms nationwide.” The Commerce has gone so far as to invite poker home games to play within its walls.

The Bicycle Casino, Hawaiian Gardens, and Hollywood Park have all come out in support of the Commerce Casino’s position. The coalition’s Waltona Manion told Poker News Daily in an interview on September 1st that, among other aspects of the bill, the group believes that the opt-out provision will not hold water if faced with a World Trade Organization challenge. In addition, Manion claimed that HR 2267 and HR 4976 would impose lower taxes on offshore internet casinos compared to what land-based casinos pay.

Congress has a target adjournment of October 8th, one month ahead of general elections in the United States. Then, following elections, a so-called “lame duck” session will likely occur. With the nation’s highest legislative body needing to pass critical appropriations bills, the possibility exists that HR 2267 could be attached to an unrelated piece of legislation, as was the case with the Unlawful Internet Gambling Enforcement Act four years ago.

Although members of the poker community have called for a formal boycott of the Commerce Casino and its partners, the PPA has not yet taken that route. The Commerce Casino bills itself as the “largest card casino on Earth” with nearly 250 tables. Across town at the Bicycle Casino, Andrew Frankenberger was crowned the champion of the recently completed World Poker Tour Legends of Poker, whose lowered $5,000 buy-in resulted in a field of 462 players.

Poker in the News: Barney Frank on The Tonight Show and More

Needless Fail League

Don’t bite the hand that feeds you. This old saying darted through my mind every time I read about the National Football League (NFL) lobbying against Representative Barney Frank’s internet gambling bill, HR 2267. Fortunately, the league ended its opposition to the bill in August because an amendment was added that would prohibit licensed online gambling operators from offering sports betting.

That doesn’t mean that the NFL’s stance on the whole issue is any less tilt-inducing to me, though. Before I get to my rant, I should say that given the NFL’s position on sports betting, I completely understand why the league, and other sports leagues for that matter, could care less about poker players. If a bill that legalizes and regulates online poker also does so for online sports betting, poker is unimportant collateral damage if the NFL manages to get the entire bill shot down. Guilt by association. I think most poker players feel the same way about sports betting. While we feel that people should be allowed to bet online, if throwing sports betting under the bus is the way for poker to come out on top, well… sorry sports bettors. Sucks to be you.

So, while I get why poker players are not a concern of the NFL, the league’s hatred of sports betting just doesn’t make sense to me. I mean, they hate it so much that they hired someone to lobby against Frank’s bill. They feel that sports betting hurts the integrity of the game. But as far as I know, there have never been any sports betting or game fixing scandals of note involving the NFL. Besides, while it’s of course possible, I find it extremely unlikely that an NFL player would be able to be influenced by criminal types to fix a game. Players get paid handsome sums of money for their skills, so the fee that someone would have to pay a player to, say, lose on purpose, would have to be pretty substantial. Plus, it would be quite difficult for a player to throw a game by himself without it being extremely obvious. I just don’t think it would realistically happen.

Getting back to my opening sentence, what really gets me is that without sports betting, the NFL wouldn’t be nearly as popular as it is today. Football season is like an extended Christmas shopping season for sports books and the Super Bowl is like Black Friday. Millions of people who either don’t have a strong rooting interest or whose team has no chance remain interested because they have money on the games. These people subscribe to DirecTV’s football package, make sure they get the NFL Network on cable, watch the commercials that feed the NFL’s coffers, and view the ads on the NFL’s website.

And all that doesn’t include fantasy football, which the NFL loves. The hypocrisy of that should be obvious. Fantasy football is gambling. It’s just in different form. Yes, many, if not most, people play fantasy for free and put no money into their leagues. But millions of people bet at least a few bucks each season, hoping that their team will win the league for a nice payout. Of course it’s gambling. Fantasy players are betting on the performance of the players they draft rather than on the performance of an NFL team. And the payouts come at the end of the season instead of at the end of each game.

One big thing that the NFL is ignoring in its loathing of online sports betting is that it’s easier to catch game fixing and the like online than it is offline. Online, all wagering history is recorded and suspicious trends are tracked. For example, in 2007, millions of dollars were bet on the European sports book Betfair against tennis player Nikolay Davydenko in a match in which he was a strong favorite and had already won the first set. He then withdrew from the match in the third set with an apparent injury. Betfair, in accordance with its agreement with the Association of Tennis Professionals (ATP), notified the ATP of this suspicious activity and cancelled all wagers on the match.

What the NFL should do is partner with the online sports books to help fight sports betting crime. Over a dozen online sports books in Europe are members of the European Sports Security Association (ESSA), which has a “mandate to keep sport clean and free from manipulation.” The ESSA members alert each other if any irregular betting patterns are detected, and in turn, alert the sports leagues and regulatory bodies. A system like this seems so obvious. In the meantime, the NFL and other professional sports leagues in the U.S. would apparently rather have online sports betting go underground with no protections, either for the bettors or the leagues, in place.

I am pleased that the NFL has dropped its opposition to the Frank bill, but it still needs to get its head out of the sand and get with the times. It owes much of its popularity to sports betting. Accept it and embrace the technological advancements that will protect the game better than prohibition will.

September 2nd – Daily Deal

On today’s Daily Deal, the coalition of California casinos clarifies its stance on internet gambling legislation, 888 reports its financial results for the first half of two-thousand ten, the World Series of Poker Main Event continues airing on ESPN and we find out who the final nominees are for this year’s Hall of Fame. It’s all ahead… faster than you can say, “I can dodge bullets, baby.”

Hello, I’m Sean Gibson and welcome to the Daily Deal by Poker News Daily.

Recently, the Commerce Casino, Bicycle Casino, Hawaiian Gardens, Hollywood Park, and the California Gaming Association joined in opposition Congressman Barney Frank’s HR 2267, which would create a full licensing and regulatory framework for the internet gambling industry in the United States.

The four casinos have found themselves in a war of words against the Poker Players Alliance, which has launched an online petition at PlayersBeforeProfits.com to reverse their stance against the groundbreaking legislation. Poker News Daily sat down with card room coalition spokesperson Waltona Manion to explore the coalition’s resistance.

Manion argued,

“We’re looking for Federal enforcement of the same strict licensing and regulation for online poker as U.S. land-based casinos abide by. This means that they have to license all of their employees and the physical operations should be in the U.S. In addition, the hardware and software should be tested and certified.”

She added, “Frank’s bill provides fewer industry regulations and player protections. It imposes lower taxes for foreign online companies than what U.S. casinos pay. It would enable illegal offshore companies to export significant money from our economy.”

We’ll keep you posted as this story develops.

888 Holdings, the gaming operator that owns 888 Poker, announced Tuesday that it will be cutting costs in order to address a loss in profits for the first half of 2010. The company has also decided to scrap its dividend in order to pay for acquisitions after the weak economy and World Cup caused a decline in poker revenue.

888’s first half financial results showed revenues were up 10.5% to one-hundred thirty million dollars, but pre-tax profit dropped by 56% to four point three million dollars. Poker revenue dropped 25% to nineteen point six million.

The WSOP Main Event continued airing on ESPN on Tuesday night with Day Two-B. Two one-hour episodes were devoted to the second Day Two and the feature table included Dan Harrington and Jeff Shulman, who were seated next to each other. Prahlad Friedman and Allied Network Solutions CEO Ted Bort tangled in a hand in which Bort called the clock after pushing all in. Friedman waited until the count reached one and quietly said, “I call,” but floor officials ruled that the clock had expired. Bort turned over top two pair and Friedman mucked.

A maelstrom of yelling ensued. ESPN aired a replay clearly showing that Friedman had called at the one-second mark and the dealer promptly said, “He called.” Nevertheless, another floor supervisor was summoned who also said the hand was dead. Don’t forget that Friedman was also involved in “Ante-gate” with Jeffrey Lisandro.

Finally, the nominees as voted by the fans are in for the Poker Hall of Fame. This year’s class is a who’s who of the poker world, all of whom have distinguished careers warranting their nominations. This year’s class of nominees, who will be voted on by the 16 living Hall of Fame members and a 17-person media panel. Only these 33 individuals cast votes for induction. The nominees are:

1. CHRIS FERGUSON
2. BARRY GREENSTEIN
3. JENNIFER HARMAN-TRANIELLO
4. DAN HARRINGTON
5. PHIL IVEY
6. LINDA JOHNSON
7. TOM McEVOY
8. DANIEL NEGREANU
9. SCOTTY NGUYEN
10. ERIK SEIDEL

Well, that does it for today’s edition of The Daily Deal, and we’ll be back with you on Tuesday of next week. Be sure to visit Poker News Daily every day for the latest poker headlines, and be sure to check us out at twitter dot com slash poker news daily. I’m Sean Gibson, thanks for tuning in, and we’ll see you next time. Now go crush those fish at the tables!

The Nightly Turbo: World Poker Tour London, Barney Frank on Jay Leno, and More

Barney Frank Talks Online Poker on The Tonight Show

On Tuesday, Congressman Barney Frank (D-MA) appeared on “The Tonight Show with Jay Leno.” Seated onstage alongside reality television icon Kim Kardashian, Frank discussed, among other topics, the recent success of HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, in Committee. A lively debate with Leno ensued. Watch here.

The portion of Frank and Leno’s debate focusing on online poker and internet gambling spanned about four minutes. Frank opened the conversation by asserting, “If you have some guy who wants to play poker on the internet, we say it’s illegal… We could make billions of dollars a year by making it legal and taxing it.” The Federal Government could stand to rake in up to $42 billion over a 10-year period by legalizing and regulating the internet gambling industry in the United States.

Not everyone was onboard with Frank’s plan, including Leno, who argued, “Vegas works because you have to go to the desert to get there. You lose your money and you come home. You can’t go to the desert again until you get more money. If you’re sitting at home and you’re up late at night and you’ve got your little credit card, next thing you know, it’s like a mini bar.”

Leno began making a potato chip comparison, but Frank cut him off by noting that there are casinos everywhere in the country, not just Las Vegas. No desert surrounds Tunica or Atlantic City, for example. In addition, HR 2267 only allows for debit card and prepaid card payments as part of a Manager’s Amendment.

Leno then reminded Frank that residents of many states were sold the lottery because all of the money that would go toward schools. Now, educational institutions across the country are struggling despite the influx of cash. Frank explained, “The problems that teachers and others face in schools can’t always be solved by money… The fact that someone oversells an idea doesn’t make it a bad idea, it makes them a bad salesman.”

Frank continued by arguing, “If you want to hit somebody or you want to burn somebody’s house or steal somebody’s car, then I want to stop you because you’re doing it to somebody else. If you want to be foolish with your own money, if you want to gamble, if you want to drink, if you want to smoke, I will tell you it’s a bad idea, but I think it’s a mistake for the government to try to stop you.” Frank has routinely argued that adults should be able to do what they want within the privacy of their own home.

The conversation then quickly digressed from internet gambling, with Leno explaining that smoking marijuana is essentially legal because everyone does it. If you’re caught, it’s only a small slap on the wrist. Frank responded, “I don’t want to say to the cops, ‘We say it’s illegal, but wink at it and go after this one.’ There’s also an element of racial discrimination in the way it’s enforced.”

One amendment to HR 2267 outlawed advertising internet gambling sites to children. The topic of kids not being exposed to internet gambling came up on “The Tonight Show,” with Frank claiming, “I do agree you can limit this to kids and in fact we’ve done that. Joe Camel has disappeared. As a general rule, the government shouldn’t be trying to live people’s lives for them. You protect people from other people hurting them.”

Congress is currently on recess until September 13th. Its target adjournment is October 8th in advance of the general elections in the United States, meaning that the legislative body will have just 20 days to tackle the internet gambling issue. In all likelihood, a “Lame Duck” session will occur as well, giving HR 2267 one last chance. Stay tuned to Poker News Daily for the latest headlines from Capitol Hill.

September 1st – Daily Deal

On today’s edition of the Daily Deal, Barney Frank may step down as Financial Services Committee Chairman; the World Poker Tour and Fox Sports Net extend a partnership; and Gus “The Great Dane” Hansen gets taken to the cleaners by Phil Ivey and Cole South.

Hello, I’m Sean Gibson and welcome to the Daily Deal by Poker News Daily.

In November, the United States will hold its general elections. On Capitol Hill, the entire House of Representatives and one-third of the Senate will be determined. If after the elections Republicans gain control of the House, then Congressman Barney Frank’s time as the Financial Services Committee Chairman may come to an end, and in the worst case scenario he would be replaced by notoriously anti-gaming Congressman Spencer Bachus.

Frank has been one of the strongest supporters of the legalization of online poker and he is currently promoting HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act. The bill was marked up in the Financial Services Committee in late July and has received the support of seventy co-sponsors. Frank has been in the House since 1980 and served as the Financial Services Committee Chairman since 2007.

The World Poker Tour and Fox Sports Net announced this week that they will continue their broadcast and promotional relationship, settling on an agreement that will stretch until 2013. The World Poker Tour’s ninth Season will begin airing in January two thousand eleven, starting with the Bellagio Cup.

The broadcast will have several improvements, including new anchor Kimberly Lansing and the introduction of the beautiful Royal Flush Girls. Season nine will also debut a yet-to-be-named new analyst who will host a recurring segment called “The Raw Deal.”

New World Poker Tour CEO Steve Heller said: “This season promises to be unlike any previous incarnations of the WPT … The shows will be faster-paced and edgier, featuring the biggest names in poker mixing it up with more up-and-coming stars, pre-final table action, and, as always, poker’s greatest and most recognizable play-by-play commentary team of Mike Sexton and Vince Van Patten.”

HighStakesDB.com has reported that hyper-aggressive pro Gus Hansen lost over one million dollars last Sunday… to just two opponents.

Cole South of CardRunners fame and eight-time World Series of Poker bracelet winner Phil Ivey took Hansen for more than one point one million dollars, almost half of the “Great Dane’s” net losses on the year. HighStakesDB – which tracks the action at high-stakes online poker tables – reported that Hansen’s losses Sunday came primarily in two and four thousand Fixed Limit Omaha Hi-Lo. He lost nearly $400,000 to Ivey in that game along with $99,000 to South, and an additional three hundred and thirty five thousand in Omaha Eight or Better when it was part of a Seven Game rotation.

All told, Hansen is down $2.3 million dollars for this year, while Ivey has cashed $3.5 million on online play. South is up eighty thousand due to a recent downswing.

Guess we should be asking for holiday gifts from Ivey, South and Jungleman this year!

Thanks for watching The Daily Deal once again, and as always be sure to bookmark Poker News Daily for the latest in poker news. Be sure to add us to your twitter feed at http://twitter.com/pokernewsdaily. I’m Sean Gibson and may the flop be with you!

California Horse Racing Wagering Bill Through To Senate

A bill, which is backed by one of the largest players in the online gaming industry, is up for a vote in the California General Assembly that would open up online betting on horse racing for the state’s residents.

The proposed bill, named SB 1072 in the California legislature, would up the cut for the state regarding its percentage of the take of wagers on horse racing. More importantly, perhaps, is the provision in the bill that would allow for “exchange betting,” otherwise known as internet wagering. The bill was on the fast track to being enacted before opposition to the legislation delayed its passage.

The bill has been amended by California Senator Ron Calderon, a Democrat from Montebello serving Senate District 30, to alleviate the concerns of much of the opposition, which included California horse trainers, among others. Under Calderon’s amendments and his sponsorship, implementation of the law (if passed through the Senate and signed by Governor Arnold Schwarzenegger) would be studied by the state legislature and the California Horse Racing Board for approximately 20 months to set the rules for implementation. This means that the law would not take effect until 2012 at the earliest.

European gaming conglomerate Betfair was critical in getting Calderon’s amended bill voted through, along with Magna International Developments. Betfair, who is also the sponsor of the World Series of Poker Europe, is the owner of the United States’ largest horse racing wagering site, TVG.com. The company sponsors races at New York’s Saratoga racetrack and, through TVG, offers internet wagering to millions of customers.

Intrastate gaming is a subject that the state of California, currently facing billions of dollars in budget shortfalls, is examining as a means of alleviating the situation. Along with the current bill that would open up wagering on horse racing, there is an ongoing drive to push for intrastate online poker, although a bill introduced earlier this year by Senator Rod Wright fell short over the California General Assembly’s summer session.

Wright’s bill, SB 1485, would have opened up the California online gaming market, in particular poker, to control by the state. The now dead bill would have authorized three “hub operators” to provide legal internet gambling outlets to California residents for a period of five years. The state would have taken 20% of the revenues monthly, which would have been paid to a specially created internet gambling fund. California residents also would have faced stiff penalties for playing on unauthorized sites.

The intrastate gaming debate has come forward as of late because of furor over the Commerce Casino’s stance against federal legislation that would fully legalize internet gaming. In testimony in July in front of the House Financial Services Committee regarding Congressman Barney Frank‘s Internet Gambling Regulation, Consumer Protection, and Enforcement Act (HR 2267), Commerce chairman Tom Malkasian came out against the proposed bill for several reasons.

Among the points cited by Malkasian was that the revenue generated by the new legislation would not stay in the United States, online companies would not face the same regulation that land-based casinos face, and jobs would be lost rather than created. His stance, which other top California card rooms such as Hollywood Park, the Bicycle Casino, and Hawaiian Gardens have stated they agree with, has angered many in the poker community.

Commerce Casino Clarifies Stance on Online Poker Legislation

Recently, the Commerce Casino, Bicycle Casino, Hawaiian Gardens, and Hollywood Park joined in opposition Congressman Barney Frank’s (D-MA) HR 2267, which would create a full licensing and regulatory framework for the internet gambling industry in the United States. The four casinos have found themselves in a war of words of sorts against the Poker Players Alliance (PPA), which has launched an online petition at PlayersBeforeProfits.com to reverse their stance against the groundbreaking legislation. Poker News Daily sat down with card room coalition spokesperson Waltona Manion to explore the coalition’s resistance.

Many in the industry have asked what brand of internet gambling legislation the Commerce Casino and its allies in California would support, if any. Federal licensing? State licensing? Poker only? Manion explained that the coalition is not against internet gambling: “We’re looking for Federal enforcement of the same strict licensing and regulation for online poker as U.S. land-based casinos abide by. This means that they have to license all of their employees and the physical operations should be in the U.S. In addition, the hardware and software should be tested and certified.” The California Gaming Association also opposes HR 2267.

The coalition also supports not granting Federal licenses to any entity that has violated U.S. law. Manion added, “Another criteria would be poker only. The Frank bill as it’s currently written authorizes all types of gaming. That violates Federal law and breaks agreements of states and tribal nations. It would violate the Indian Gaming Regulatory Act.” One amendment to Frank’s HR 2267 prohibited online wagering on sports, leading to the NFL dropping its opposition to the bill. Manion also stated that states should have the right to continue to regulate gaming in their own jurisdiction.

Manion also expressed concern over the level of protections included in Frank’s measure: “Frank’s bill provides fewer industry regulations and player protections. It imposes lower taxes for foreign online companies than what U.S. casinos pay. It would enable illegal offshore companies to export significant money from our economy.” The tax companion bill to HR 2267 is Congressman Jim McDermott’s (D-WA) HR 4976, which has not yet been marked up in the House Ways and Means Committee.

Despite the spat playing out in the public arena, Manion told PND that the poker lobbying organization and the California casinos have not yet sat down and discussed their differences on HR 2267: “The PPA’s leadership were present during the Financial Services Committee hearing and said nothing to us. They did not contact anyone from the Commerce Casino or any of the card rooms. Had the PPA contacted the Commerce or the major card rooms in California and said they had major concerns or if they had read the testimony more closely, they would agree that most of what we’re talking about is valid.”

According to a 2009 survey by Fairbank, Maslin, Maullin, and Associates, 55% to 57% of Californians support the state collecting revenues from online poker. Among the most important factors to respondents were ensuring that minors don’t play, full transparency, independent audits, and cracking down on unauthorized sites. The West Coast state could be among the first to green light intrastate internet gambling given a sizable budget shortfall. California State Senator Rod Wright had introduced SB 1485 this year, but the bill ultimately stalled on its way to becoming law in July.

HR 2267 offers an opt-out provision for states and tribes that don’t want to take part in a Federal internet gambling scheme. However, Manion believes that the provision won’t stand up if reviewed by the World Trade Organization (WTO): “We don’t believe that the opt-out provision as currently written will hold up to WTO scrutiny. If they were to challenge HR 2267, that’d be the component that would be challenged. We should preempt that now so we don’t get a challenge from the WTO. It would leave state-regulated gaming vulnerable.”

Nevertheless, if HR 2267 were to become law before the end of the current legislative session, California could opt out of the legislation and go it alone in the online poker world. However, its lack of liquidity compared to the Federal model could result in its demise. Manion remarked, “Our immediate focus is amending the Federal legislation and also working with the state legislature on legislation they believe would ensure that California revenues stay in California. If the Frank bill passed, the opt-out provision would be in play and California could opt out. The California state legislature could also act in advance of Frank’s bill becoming law.”

HR 2267 was marked up and passed out of the Financial Services Committee on July 28th. Congress is currently in recess.

The PPA’s petition has lapped 7,200 players and talk of a boycott of the Commerce has arisen among poker pros. UB.com pro Annie Duke, for example, commented via Twitter, “I and some other pros are boycotting them as well. I will give my business to a place that supports the players.” What the next chapter will be in this ongoing saga is anyone’s guess.

Poker Players Alliance Responds to Commerce Casino’s Opposition on Online Gambling Legislation

Barney Frank Out as Financial Services Committee Chair in 2011?

In November, voters in the United States will head to the polls for general elections. On Capitol Hill, the entire House of Representatives and one-third of the Senate will be determined. If Republicans were to gain control of the House, then Congressman Barney Frank’s (D-MA) tenure as Financial Services Committee Chairman may come to an end.

A recent Financial Times article discussed the future of the lower Congressional body: “Polls show control of the House of Representatives is too close to call while the Democrats are expected to retain control of the Senate, albeit with a reduced majority.” Frank has been in the House since 1980 and served as the Financial Services Committee Chairman since 2007. Democrats currently control nearly 60% of the seats in the House and Senate.

Congressman Spencer Bachus (R-AL) serves as the Ranking Member of the House Financial Services Committee, although he apparently seems far from a lock to take over the Chair should the opportunity arise. However, the Financial Times revealed, “Mr. Bachus said, ‘I will be the chairman if we’re in the majority.’ [Congressman Jeb Hensarling (R-TX)] said, ‘My expectation is that Spencer Bachus will be the next Chairman of the House Financial Services Committee and I support him.’”

What’s the significance of this story for online poker players, you ask? Frank is internet gambling’s number one supporter on Capitol Hill, having offered up a handful of bills to legalize the industry in the United States. His latest effort, HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, was marked up in the Financial Services Committee in late July and has received the support of 70 co-sponsors.

HR 2267 received about a dozen amendments during mark-up, ranging from ensuring that online sports betting would not be legalized to prohibiting existing sites that serve the U.S. market “illegally” from applying for a license. Now, the measure awaits its time on the House floor, although HR 2267 being attached to a must-pass bill later this year is a possibility. Ironically, the Unlawful Internet Gambling Enforcement Act (UIGEA) was attached to an unrelated port security measure to become law in 2006.

Bachus remains one of the strongest opponents of legalized internet gambling. During HR 2267’s markup hearing on July 28th, Bachus opened the proceedings by arguing, “After all of the talk of the past year of shutting the casinos down on Wall Street, why would we take steps today to open casinos in every bedroom and every dorm room on iPods, Blackberrys, iPhones, and computers?”

In the meantime, HR 2267 has caused a rift of sorts in the poker community. The Commerce Casino’s Tom Malkasian was among those witnesses who spoke against the bill in a July 21st House Financial Services Committee hearing. In response, the Poker Players Alliance (PPA), the industry’s main lobbying voice, issued an online petition to force the Commerce to change its position. The petition, found at PlayersBeforeProfits.com, has received over 7,000 signatures.

The Commerce Casino then fired back, arguing in a press release distributed in Friday, “Nevada casinos, offshore companies, and Washington insiders don’t want California to benefit from its own market. Our economic future is not their concern. We support free enterprise, fair competition, and the principle that what plays in California, stays in California.” The Los Angeles casino also claimed support from the Bicycle Casino, Hawaiian Gardens Casino, and Hollywood Park Casino.

Several poker pros have suggested a boycott of the Commerce Casino, although one has not yet occurred. The Bicycle Casino is fresh off hosting the World Poker Tour’s Legends of Poker, which saw Andy Frankenberger walk away with the title and $750,000 top prize.

Stay tuned to Poker News Daily for the latest headlines from Capitol Hill and beyond.

August 30th – Daily Deal

Happy Monday to everyone! On today’s Daily Deal, the Commerce Casino receives support from several of its competitors, Daniel Negreanu fires insults at Annie Duke, and an important figure in the Senate comes out in favor of online poker legislation. It’s all ahead… right now!

Hello, I’m Sean Gibson and welcome to the Daily Deal by Poker News Daily.

Let the battle lines be drawn. Several days after the Poker Players Alliance issued a petition to reverse the Commerce Casino’s stance against pro-internet gambling legislation in the United States, more casinos have come onboard to strike down the bill. In a letter issued to the press late Friday night from Commerce Casino Board members, it was revealed that the Bicycle Casino, Hawaiian Gardens, and Hollywood Park casinos also oppose Congressman Barney Frank’s HR 2267.

The press release claimed, “Californians wager an estimated thirteen point four billion dollars annually. That makes California the largest internet gaming market in the world, and without state legislation to protect it, critically-needed billions will be captured by offshore and out-of-state operators never to return.”

Why the Commerce Casino, Bike, or any other California casino wouldn’t just apply for a license under HR Two-Two-Six-Seven remains to be seen. PPA Executive Director John Pappas speculated in an exclusive interview with Poker News Daily, “They don’t want to compete with existing online operators or Harrah’s or Wynn or Google or anyone else who may get involved in internet gambling. They prefer to have their own fiefdom in California… A lot of lawmakers went out of their way to address their concerns via amendments, yet they still continue to oppose the bill.”

Moving over to another bitter dispute, in an interview with PokerPlayer, PokerStars pro Daniel Negreanu fired off what many have deemed inappropriate comments against Annie Duke. In an article entitled “The Evolution of Daniel Negreanu,” he was asked about the two-thousand ten World Series of Poker Ladies Event in which more than a dozen men played.

Negreanu voiced his disgust at the whole situation and then went on a tirade about Duke, who has never been an advocate of the tournament:

“What irked me is that this woman has the audacity on her website to call herself ‘the best female poker player in the world.’ So I’m like ‘how offensive are you, you f***ing c***? You want to say you’re speaking for women, yet you claim superiority over all of them.’”

Wow. Well … after afterwards Duke issued an open letter to PokerStars about the use of the c-word and the site ultimately responded, “PokerStars does not support the use of derogatory or hurtful language directed at any other player. While this was a personal matter between two players, we wish that better judgment had been used in the choice of words.”

Duke’s brother Howard Lederer and Tony G have been among those pros weighing in on the spat.

Finally, according to the Reno Gazette-Journal newspaper, U.S. Senate Majority Leader Harry Reid claimed he would support the legalization of online poker in the United States. Reid also stated he would not support any other form of online gaming, including sports betting.

Reid also won’t support anything that hurts Nevada jobs, but the Senate Majority Leader will play a huge role in whether online poker is legalized. No progress has been made on legalizing internet gambling or online poker in the Senate, so having Reid as an ally could go a long way.

That does it for today’s Daily Deal, be sure to check back every weekday for a new episode of this show. Also be sure to check back with Poker News Daily throughout your day to find out the latest in poker news. I’m Sean Gibson hoping you have an amazing week at the tables!

Senate Majority Leader Harry Reid Supports Online Poker Legislation

U.S. Senate Majority Leader Harry Reid (D-NV) had long been on the fence regarding the legalization of online poker in the States. But when Reid sent a letter to Treasury Secretary Timothy Geithner and Federal Reserve Board Chairman Ben Bernanke asking for a delay for the enforcement of Unlawful Internet Gambling Enforcement Act (UIGEA) regulations in November of last year, it became clear that the influential politician was becoming more favorable toward poker on the internet.

This week, Reid showed even more support of online poker in the state of Nevada. According to the Reno Gazette-Journal newspaper, Reid claimed he would support the legalization of online poker in the United States during an August 16 meeting at the Atlantis Casino Resort Spa. Reid also stated he would not support any other form of online gaming, including sports betting.

The news was disconcerting to Nevada gaming executives, who fear that the legalization of online poker will result in a major loss of customers in brick-and-mortar casinos.

“It (online poker) is just the tip of the iceberg and could open up this state to more online gaming,” said Bill Hughes, the Marketing Director of Peppermill, to the Reno Gazette-Journal. “It will only draw more money out of this state, from our poker rooms and eventually other facilities.”

Reid has stated that he would not support anything that hurts Nevada jobs, but the Senate Majority Leader will play a huge role in whether online poker is legalized. The House Financial Services Committee passed HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, in July and the bill is currently waiting on a vote by the full House. HR 2267 would effectively legalize online poker, overturning a 2006 law that bars offshore sites from accepting money from U.S. bettors.

Congress is on summer recess until September 8, at which point Congressman Barney Frank (D-MA) hopes the House Ways and Means Committee will mark up their tax companion bill, HR 4976, and bring both measures to the floor.

Meanwhile, gaming properties in Nevada, such as Harrah’s Entertainment and MGM Resorts International, are in the process of developing strategies to monetize the legalization of internet gaming. With the future of sites like PokerStars, UB.com, and Full Tilt Poker up in the air following the markup amendments of HR 2267, people like Jan Jones, Harrah’s Senior Vice President for Communications and Government Relations, seem to think online poker would improve Nevada’s gaming market.

“If you look at the businesses that are surviving today, they approach their customers in three ways,” Jones told the Gazette-Journal. “One is brick and mortar. One is direct marketing sales, and the other is the internet.

“The businesses that have not done that have gone out of business. Look at record stores. Look at newspapers. In the gaming industry, we need to realize, where are the X-Y generation customers? They are all on the internet. That is where they play. That is where they congregate, and if we don’t leverage the internet, then we run the risk of becoming an old person’s entertainment.”

Stay tuned to Poker News Daily for the latest news on Capitol Hill.