The 10 Best Things About the Regulation of Internet Poker

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While some politicians would like to see Internet poker outlawed entirely in the U.S., the fact is that there has never in history been a time where there was more interest among the populace in playing the game of poker, both here and abroad. History has taught that prohibiting a popular recreation is ineffective – it just drives the activity underground, operated mostly by a criminal element and jeopardizing the well-being of common citizens who simply wish to recreate.

We have already seen this in effect for Internet poker. Despite all the efforts of our federal law enforcement officials, there is still an active marketplace from U.S. players on unauthorized offshore sites. The players know the risks are high – from unscrupulous operators to bad software to vulnerable systems – but they are willing to suffer the risks for the enjoyment they get from the game.

Regulation is the answer, not prohibition. But what is so great about regulation? Here is my countdown of the top ten things that are great about Internet poker regulation.

10. Standard consumer protections are in force.

There are laws which provide consumers with basic protections. Consumers have come to expect protections for their privacy, account security and product quality. Under a legally authorized and regulated industry, these same consumer laws will apply for Internet poker players. In addition, regulations can ensure that players have recourse to customer service of the site operators, and if necessary, arbitration by the regulatory authority. And should it come down to it, the U.S. court system will be available to players who have been wronged.

9. Detection and prevention of cheating and fraud.

There is nothing more effective to prevent cheating and fraud than a legally-enforceable criminal penalty. The history of Internet poker has been rife with examples of site operators or players committing acts to cheat or defraud participants in the games. And in almost all cases, they have gotten away without any criminal consequences. Under a system of law and regulation, they won’t. Regulatory oversight will ensure that modern technological systems are in place to detect or prevent such acts, which will deter them in most cases, or bring the perpetrators to justice.

8. Keeping the unscrupulous out of the industry.

Wherever Internet poker legislation is up for legislative hearings and votes in a state, there is a lot of talk by stakeholders and politicians about excluding “bad actors” from the industry. But this term is really just used a euphemism to protect the new stakeholders from foreign poker site operators who would have a competitive edge because they took play from U.S. players for years without express authorization by the state.

But you or I would put a different definition to “bad actor”. We would want to be protected from a “bad actor” because they are someone that would commit bad acts against us. We don’t want to put our money in the hands of someone who is not trustworthy.

A regulatory system requires a squeaky clean background for anyone who owns, runs or is employed by an Internet poker site. There are probably no more extensive regulatory background checks and investigations of key personnel in any business enterprise than in the gaming industry. Regulation would keep out the true bad actors from the sites available to U.S. players.

7. Preserving the Tenth Amendment rights of the States.

The Tenth Amendment of the U.S. Constitution reads: “The powers not delegated to the United States by the Constitution, nor prohibited by it to the states, are reserved to the states respectively, or to the people.”

This means that if the authority to rule an activity or liberty is not expressly given or reserved to the federal government by our Constitution, it is reserved to each state to decide its own public policies in regards to such activity or liberty. Gambling has always been such an activity, reserved for regulation by the states. It is the right of each state to choose to prohibit, regulate or simply allow Internet poker.

The regulation by a state of Internet poker is the exercise of a Constitutional right, one that should be preserved.

6. Ensures a fair game.

Ensuring that the games offered by an Internet poker site are fair requires a lot of technological know-how. The deal of the cards must be unpredictable and independent of all previously dealt cards. The computerized gaming systems must be secure and monitored, including the networking, employee access, communication portals, software upgrades, and more. A robust regulatory regime will ensure that the games and the related systems meet strict minimum standards to provide a fair and transparent gaming experience for the players.

5. Prevents money laundering.

Money laundering requires hidden identities to be effective. While an unregulated Internet poker network might be useful for the money launderer looking for a way to move large amounts of money undetected, any poker network under regulation will accurately record every transaction and the related identities. It is the money launderer’s nightmare. Automated systems to detect the movement of large sums can be easily required and integrated to meet money laundering prevention standards under regulation. As evidenced by recent fines and court cases against casinos, money laundering at a live casino is far easier.

4. Protection of players from loss of funds.

Internet poker players have cumulatively lost tens, if not hundreds, of millions of dollars from their poker accounts. I am not talking about gaming losses. I mean losses from their account balances through theft, mismanagement or insolvency by or of site operators. Proper regulations for the separation and protection of player account funds can protect players from such unwarranted losses.

3. Prevention of underage participation.

It is certainly the responsibility of each parent or guardian to monitor and control the activities engaged in by their children. Yet industry regulations are often needed to provide tools to help protect children from societal dangers. Film and computer game ratings, ID checks for alcohol purchases and V-chips for TVs are some effective examples. Under regulation, Internet poker sites would verify the identity and age of every registered player. Additional tools required under regulation such as password protections and financial transaction verifications will help parents to keep the underage from participating. It will be a lot harder for someone underage to play on an Internet poker site than it is for them to walk into a casino and play, or buy some lottery tickets.

2. Detection and prevention of compulsive gambling behavior.

Internet poker gaming systems can excel in detecting and preventing compulsive gambling behavior. Every aspect of self-limitation and self-exclusion from the games can be made available to players, including limitations on stakes, deposits, time spent or wagers made, and exclusions from certain games, certain sites or all gaming, for a short or long period of time, or forever. In addition, automated methods to detect compulsive gambling can be implemented, and regulations can require further investigation with the player to determine if restrictions or help is needed. No brick and mortar poker room or casino can provide the level of protections for compulsive gamblers that regulated Internet poker sites can.

1. Preservation of freedom of choice.

The greatness of this country is directly proportional to the unencumbered exercise of freedoms by its citizens. Americans love to play poker, and love to play on the Internet. Is it not incumbent on our politicians to preserve that freedom? Regulation can provide the protections necessary for the public health while preserving this freedom of choice for adults to play their favorite pastime.

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