Category: Online Gaming

Online Gaming Legislation In The United States

Unlike the European online games market, the American market is officially in its infancy. Officially because Americans have been playing online games for a long time – unofficially, particularly in poker, but no regulatory authority controls the activity.

An illegal but “authorized” online gaming market.

In the 2000s, online games were banned in the United States. At this time, a lot of Americans are gambling online when it is illegal. Everyone is more or less aware of this, but bank cover-ups can delay the deadline. In 2004, Google and Yahoo announced that they were removing all advertising banners related to online games and promotions.

Since 2006, the creation of the UIGEA – Unlawful Internet Gambling Enforcement Act – has made it possible to control certain transactions and detect illegal operations. Following this, many operators (linked to casino activities) announce that their offer of real money games is pending. In parallel, the main operators of online poker – Pokerstars, Full Tilt Poker, or Bodog – continue to work, hoping to remain discreet.

In 2009, and for the first time, money was seized from some American poker players’ accounts. $ 34 million is entered on 27,000 player accounts. The following year, New Jersey was one of the first states to talk about online legalization. The text in question speaks of authorizing poker and casino games but not sports betting. A survey of the population shows that they moderately agree.

The famous Black Friday and the Full Tilt Poker affair

In April 2011, a real thunderbolt was heard in the United States. On Friday, April 15, the FBI in person blocked 3 poker sites – Pokerstars.com, Full Tilt Poker, and Absolute Poker – and not the least since they are among others the number 1 and 2 of online poker worldwide. An arrest warrant has also been issued against the founders of Pokerstars and FTP, respectively Isai Scheinberg and Raymond Bitar. The charges are organizing illegal gambling and money laundering of more than $ 3 billion.

Absolute Poker will not rise, and its director will go to jail for a while. Pokerstars will succeed in a while to prove that its financial management, although on the verge of legality, did not mislead the player and that all the deposits were available. However, the matter is more complicated for Full Tilt Poker. Indeed the company is managed very lightly, and a large part of the deposits of players are in the bank accounts of the manager, Ray Bitar, and some shareholders like Chris Ferguson or Howard Lederer(sums for these gentlemen up to several tens of millions). As often in this type of case, the police will threaten, indict, but the penalties, compared to the height of the fraud, will be ridiculous.

Full Tilt Poker must, therefore, reimburse hundreds of millions of players. To save the company and after adventures on potential buyers, Pokerstars, the number 1 and main competitor, decides to buy the company and reimburse, in partnership with the DOJ (Department of Justice), the injured players. With this operation, Pokerstars ensures to dominate global online poker and partly improves its image. Today, European players have been reimbursed, but American players are still waiting for their money. After that and until the end of 2012, all online poker activity in the United States is strictly prohibited. This time, we no longer laughs, and those who want to play online must expatriate.

The waves of legislation in the United States

Finally, it was during 2012 that some American states slowly began to legislate to authorize certain forms of online games. The New Jersey, the Nevada, and Delaware are the spearheads of this movement. And the very first is Nevada at the end of February 2013, which exclusively allows online poker. It is followed by New Jersey, which authorizes the casino games in their entirety – and by the same token hopes to save the economic activity of Atlantic City – then Delaware.

On April 30, 2013, the first poker site launched in Nevada. Ultimate Poker allows US residents of Nevada to play, but the regulations apply only to the state in which that regulation is made. In other words, Nevada people can only play with each other, but the beginnings are quite promising. Some actors talk about allowing Americans to play among themselves, or even to play with other foreign jurisdictions, such as the British. A first step has been taken at this level with an upcoming market meeting between Delaware and Nevada, decided in early 2014.