Wire Act Uncertainty Extended, U.S. Online Poker Remains in Limbo
Exactly what the future of online poker will look like in the U.S. will remain a complete mystery for a little while longer, it seems.
The Department of Justice originally laid out an April 15 deadline for compliance with its reinterpretation of the Wire Act, wherein the DOJ stated that the Wire Act applied to all forms of online gambling and not just sports betting. That ran contrary to a previous opinion published in 2011 that cleared the way for online poker and other activities to be legalized in some U.S. states.
That date has now been extended 60 days to June 14, Online Poker Report reported.
The decision only adds to the murkiness of the situation. A cloud has hung over the online gambling industry since the mid-January release of the revised interpretation. Opinions vary on whether the re-interpretation has any teeth, and now the uncertainty will likely continue for the near future.
Wire Act Under Attack
The DOJ's January memo said everyone had 90 days to comply with the new ruling.
Almost immediately, stakeholders in online gaming reacted with an uproar. After all, many states used the initial 2011 opinion as a go-ahead to pass legislation that legalized online gambling, in many cases making it a key part of state budgets.
The New Hampshire Lottery brought a lawsuit forth. Key backers of online gambling in states like New Jersey adamantly stated that the federal government had overstepped its bounds. Many poked holes in the DOJ's position and predicted it wouldn't stand up in court.
Perhaps in response to all of the backlash, the U.S. attorney general's office announced last week the window would be extended. However, they warned that the Wire Act would still be enforced when the time comes.
"Providing this extension of time is an internal exercise of prosecutorial discretion and does not create a safe harbor for violations of the Wire Act," Deputy U.S. Attorney General Rod Rosenstein wrote.
Despite the lack of clarity regarding the reinterpreted Wire Act, and the wonder by many whether it would even be enforced, some ramifications have already hit the online gambling industry in the U.S.
Of interest to many poker players not just in the U.S. but the world over, the World Series of Poker's online bracelet events — nine are scheduled for 2019 — may be once again restricted to those inside Nevada's borders.
The WSOP is currently evaluating its options and hasn't made a definitive statement on the matter. The new compliance date of June 14, of course, falls smack in the middle of the WSOP. A conservative decision to restrict things to Nevada would mean smaller prize pools for everyone.
Furthermore, Pennsylvania, which became the fourth state to legalize online poker with a sweeping internet gaming bill back in October 2017, has thus far delayed opening up its market.
Just days ago, regulators admitted the Wire Act was hanging over everything and slowing things down ($), Poker Industry PRO reported. Quotes from Pennsylvania Gaming Control Board Executive Director Kevin O’Toole won't give online poker hopefuls any reason for optimism on the state joining the multi-state liquidity agreement.
"With that reinterpretation it became quite obvious that everything had to be on an intrastate basis, and that would probably be the biggest challenge," he said. "Not so much of a challenge but a modest delay, to establish an adequate server location within the commonwealth of Pennsylvania."
The new estimate from O'Toole was that opening of the market would be "three to four months" away.
A Final Angle
The reinterpreted Wire Act isn't the only thing that's come under attack over the past few months in the world of online gambling legislation. Exactly how this whole process even got started has been the subject of much discourse.
Many speculated that Venetian owner and longtime online gambling mega-opponent Sheldon Adelson was behind the memo. As one of the biggest donors to the Republican party, Adelson exerts considerable influence in lobbying for policy.
In February, The Intercept extensively reported on the suspicious timing behind the memo's release, which coincided with a government shutdown and hit right before states' rights advocated William Barr would be elevated to head of the department.
At the end of February, news hit that Adelson, 85, had possibly been in poor health. In response, the company admitted he has non-Hodgkins lymphoma.
What effect, if any, that development will have on the continued process of interpreting and enforcing the Wire Act is unknown.