By
Dan |
Published
Nov 12 2008, 10:21 PM
On Wednesday, the final regulations of the Unlawful Internet Gambling Enforcement Act (UIGEA) were formally passed. The UIGEA regulations were one of the so-called “midnight rules” of the Bush Administration and will take effect one day before incoming President-elect Barack Obama takes office, which occurs on January 20th, 2009. This week, the PocketFives.com Podcast focuses on the breaking news from around the online poker industry, not just on Capitol Hill, but also in Kentucky, the site of an ongoing legal battle between Governor Steve Beshear and representatives of 141 internet gambling domain names. Poker Players Alliance Executive Director John Pappas and Safe and Secure Internet Gambling Initiative Spokesperson Jeff Sandman are our guests.
The Podcast was recorded on Wednesday of this week, the same day that the UIGEA regulations were finalized and released. One of the hot topics leading up to the rules’ final passage was the role of former NFL lobbyist William Wichterman. John Pappas, the Executive Director of the Poker Players Alliance, which is the main lobbying group for the online poker industry, explains, “As we saw bubble up over the past couple of days, there are serious questions as to the role of a current White House aid and former lobbyist [Wichterman] who helped push this through on behalf of the sports leagues, the NFL primarily.”
The NFL and other sports leagues came out against HR 6870, the Payments System Protection Act, which sought to clarify the UIGEA as to what was legal and not under the law. Pappas added, “The NFL was one of the primary motivators for [the UIGEA] back in 2006 when it was passed through the House. They claim they want to preserve the integrity of the sport and therefore abolish internet sports gambling. However, as we’ve noted for months now, the NFL didn’t have a problem getting an exemption in the UIGEA for a fantasy sports.”
UIGEA compliance, as instructed by the final regulations, is not required until December 1st, 2009. However the UIGEA sent shockwaves through the industry upon passage in 2006, despite its murkiness and lack of formal rules. Pappas urges industry members to exercise caution: “I would caution that no one should act hastily. In all likelihood, the new Administration, in one of its first acts, will rescind not just this midnight rule, but all midnight rules that are coming out of the lame duck Administration.”
Online poker has also come under fire in Kentucky, where the State’s Governor, Steve Beshear, is attempting to seize 141 internet gambling domain names, including those associated with PokerStars, Full Tilt Poker, Bodog, Doyle’s Room, Cake Poker, Absolute Poker, and Microgaming. Several targeted sites have complied with a lower court Judge’s mandate and are no longer allowing new registrations from the United States. However, the formal forfeiture hearing is not scheduled until December 3rd. Appeals have been filed in the case and will be addressed on November 18th. Jeff Sandman, spokesperson for the Safe and Secure Internet Gambling Initiative, joined the Podcast to talk about the case as well as developments on the national level.
Sandman believes that regardless of what happens, people will continue to play online: “Irrespective of what the Appeals Court decides, the reality is that it won’t stop Kentuckians or anyone else from gambling online. Offshore gambling will still go on.” On what the three judge Appeals panel will be looking for, Sandman explains, “The Court wants to make sure that the lower court’s ruling was in line with current law. The judges will look at whether the Governor overstepped the legal boundaries. If they rule in favor of this prohibition, I wouldn’t be surprised if it’s taken to the State Supreme Court.”
Sandman also adds his take on the approval of the UIGEA regulations: “It’s up to Congress to move in and create a new law. By doing what the Bush Administration is trying to do, it will hamstring the Obama Administration from dealing with the issue.” Like Pappas, Sandman was also alarmed at the apparent involvement of the NFL, despite a Washington Post newspaper article that claimed Wichterman “appropriately sought and received clearance from ethics officers to be able to work on this rule.”
Hear about all of the latest news this week on the PocketFives.com Podcast.
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