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Online Poker Legislation: The Year in Review

Online Poker Legislation: The Year in Review 0001

It was a roller-coaster year politically for Internet poker in 2010. The first half of the year was like a slow climb of anticipation up the track, then came the steep drop in June, a new high in July, another plunge in September and a series of loops in the final month.

Poker players got off the ride a little dizzy, slightly confused and standing virtually in the same place they got on.

There is no doubt that Internet poker made more progress on Capitol Hill in 2010 than ever before. Yet, it could easily be argued that the industry is worse off now than when the year began.

The gains were more symbolic in nature. You might say poker got in scoring position for the first time, but the runner was left on base. Nothing was put up on the scoreboard.

That's not to take away from the accomplishment in July when the House Financial Services Committee approved Barney Frank's bill to license and regulate Internet poker. To think that there was a positive vote on Capitol Hill to legalize the industry when four years ago the legislators were trying to shut it down shows how much progress has been made.

Another hearing on Internet gambling took place in the House Ways and Means Committee, indicating that Congress was serious about considering the possibility of regulation.

But with representatives concentrating on campaigning for the November election, the issue stalled there. It looked like that would be it for poker's prospects in 2010, and then came the post-Thanksgiving news that Senate Majority Leader Harry Reid was pushing for an Internet poker bill during the lame-duck session and the crazy weeks that followed.

Reid's attempt to attach a poker bill to legislation extending Bush-era tax cuts didn't materialize, and we'll probably never know for sure how much of a chance Reid actually had to make it happen. But, for the first time, there was a buzz in the poker community that legalization was perhaps imminent.

We also got to see a preview of the sort of unpopular issues that players might have to endure to make legalization a reality. Leaked drafts of Reid's proposal included a 15-month dead period for the industry to reset and at least a temporary separation of the U.S. and international player pools.

Even if Reid's push never went far enough to justify the hype it received, it's safe to say that December 2010 was the closest we have come to federal licensing and regulation of Internet poker.

On the state level, New Jersey's State Senate became the first legislative body in the U.S. to pass legislation to legalize Internet gambling in November. Unlike at the federal level, the bill will maintain that progress heading into the new year, when it will go in front of the State Assembly.

Although the victories of 2010 have yet to bear any fruit, the defeats left visible damage.

First the long-delayed Unlawful Internet Gambling Enforcement Act finally went into enforcement in June, nearly four years after it was passed by Congress. On the one hand, the UIGEA has been ineffective in that it is intended to stop the funding of offshore poker sites, yet people are still playing online. However, the UIGEA has limited the ways to deposit and caused delays in withdrawals, while also encouraging the Department of Justice to become more brazen in going after payment processors.

In September, the Washington State Supreme Court upheld a 2006 law, overturning an appeals court ruling, making Washington the first state to specifically criminalize the play of online poker. PokerStars and Full Tilt Poker responded by withdrawing from the state, making Washington the first state in which the major sites are not accessible.

The November elections changed the configuration of Congress, and not in a good way for poker. Everyone likes to say that online poker is a bipartisan issue, and there are Republicans who support the rights of people to play the game. But the main opponents of poker are also Republicans, the religious right Republicans who oppose any form of gambling on a moral level.

It remains to be seen how the new Tea Party Republicans entering Capitol Hill respond to poker. But the Tea Party movement has given power to poker's opponents, like Rep. Spencer Bachus (R-Ala.), who was named as the replacement for poker ally Frank as chairman of the House Financial Services Committee.

There are positives to come out of 2010. Major media was increasingly supportive of people's right to play poker, additional congressmen saw the light that regulation is better than prohibition and the highest ranking member of the Senate — once an opponent of online poker — went public with his intention to push for legislation.

That the negatives left more of a mark just goes to show that the status quo can't be maintained. The online poker climate will continue to get worse for U.S. players until legislation to license and regulate the industry is in place.

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