No surprises at congressional hearing on internet gambling

Political ignorance and biased misinformation probably characterise the proceedings in Washington DC yesterday (Wednesday) when the House Judiciary Subcommittee on Crime, Terrorism, Homeland Security and Investigations listened (and gave their own often mystifying views) to testimony from a witness list loaded to present an argument that internet gambling should be federally banned.

The hearing was clearly designed to progress land casino mogul Sheldon Adelson’s Restoration of the American Wire Act, which is currently being obediently driven by Utah Rep. Jason Chaffetz. Given the loaded nature of the witness list and with the presence on the sixteen-seat Congressional panel of at least five co-sponsors of the RAWA, that seems likely to occur.

Witnesses like dyed-in-the-wool internet gambling critics John Kindt, Les Bernal and Michael Fagan, encouraged by chairman and well known internet gambling opponent Rep. Bob Goodlatte, predictably trotted out the same old tired, outdated clichés and unsubstantiated claims that online gambling is highly addictive and is a vehicle for money launderers and the transmission of terrorist funding; that its regulation cannot be properly enforced; that under-aged or problem gamblers cannot be excluded; that it cannot be confined within the borders of individual states and that it threatens society in general.

Aside from deliberate economies with the truth, some witnesses – and indeed several members of the committee – appeared to be completely out of step with developments in technology…or chose to ignore the realities of internet gambling.

Two witnesses, Parry Aftab and last-minute listed Andrew Moylan attempted to bring some logic and common sense to the proceedings with hard factual presentations and appeals for federal respect of states’ rights, but it remains to be seen whether they were able to penetrate the consciousness of the majority of the panel on this justifiably described dog and pony show.

Mystifyingly, the committee does not seem interested in the very positive empirical knowledge gained by regulators in Nevada, Delaware or New Jersey, where regulated online gambling has been in operation for the last eighteen months; if they are this was not reflected in their list of witnesses.

Likewise, they chose not to hear from the authors of acclaimed and fact-based historical studies on the intent of the original Wire Act, like Michelle Minton.

Parry Aftab of Wired Safety covered some of this input by reporting on the positive input her survey of the three US regulators had received, which showed that intrastate regulation is not only possible but highly effective in all major areas of concern to detractors, and that it’s harder for blocked categories of aspirant players to enter a regulated online gambling site than it is to get into a land casino.

Andrew Moylan opined that RAWA represented federal overreach and an intrusion into states’ rights, and suggested that this was not only wrong but unnecessary. Individual states had both the legislative authority and enforcement capability to decide on laws affecting those within their boundaries, he suggested.

Earlier in the day the Poker Players Alliance staged an effective technical demonstration of the capability of online companies to exclude under-aged, problem or out-of-state gamblers, and the use of systems designed to guard against money laundering or criminal involvement.

Attendees at the demonstration were shown that players have to go through as many as eight different verifications, including providing their Social Security numbers, before they can start betting.

Several members of the committee appeared more open to new perspectives, although it has to be said that their fears appeared to be more about the intrusion on state rights and lotteries than approval for gambling.

Others appeared worried that imposing a nation-wide federal prohibition may, like alcohol Prohibition in the ‘twenties, simple encourage more black market activity and the attendant risk of criminal involvement.

Democratic Party Representative John Conyers of Michigan, said he opposed the bill, saying:

“We cannot ban our way out of this problem. The better option is to allow states to permit online gaming as they see fit, subject to regulation and monitoring.”

John Pappas, executive director of the PPA, summed up his perception of the hearing when he wrote:

“Today’s hearing was about one thing – checking the box to advance Mr. Adelson’s bill. While the PPA has always encouraged a national discussion on the value of regulating online gambling, constructing a hearing at the behest of a political donor is an unfortunate waste of everyone’s time.

“This bill should die today, so members of the Committee can focus on more pressing matters, and not on legislation that will deny states the ability to protect citizens.”

The sub-committee will now forward its conclusions to a Judiciary Committee session where the bill will be opened for amendment and votes.

Two respected online gambling commentators tweeted their feelings about the hearing as well:

Joe Brennan, Jr., posted: “Sounds like the hearing on #RAWA is going as expected: the ignorant are leading the blind.”

Chris Grove observed: “Why are we having a hearing about regulated online gambling that has not one regulator giving testimony? #RAWA”.