Online Poker Industry in High-Stakes Fight to Ease Restrictions

7/26/09 - Miami Herald - View Source

By Michael Vasquez

If it weren't for Internet poker, Jason Mercier might be a math teacher right now.
Instead, the 22-year-old from Davie is a rising poker phenom -- dominating high-priced poker tournaments from Barcelona to the Las Vegas strip.

But the online road to riches that Mercier achieved -- and that many others pursue not quite so successfully -- operates under a legal cloud.

The Unlawful Internet Gambling Enforcement Act -- passed by Congress in 2006 -- didn't outlaw Internet poker, but under some interpretations it did ban the bank financial transactions necessary for players to ``buy-in'' through the Web. The ambiguity led some poker sites to abandon the U.S. market, and some players to quit playing online in an abundance of caution.

Getting your poker fix online could become even tougher on Dec. 1, when a portion of the 2006 bill that further discourages banks from doing such business is scheduled to take effect.
But the complete eradication of online poker may prove difficult, if not downright impossible. Even under the weight of the current federal restrictions -- and despite the seizure last month of at least $30 million in player payments and deposits by federal prosecutors -- plenty of Americans still play poker online.

The Washington-based Poker Players Alliance -- which has experienced a surge in membership following Congress' action three years ago -- says poker websites adapted to the federal money seizure by simply finding other creative ways to get payouts to their players. With U.S. players generating an estimated $85 million in revenue for these sites monthly, the companies could afford to eat the $30 million hit.

The poker alliance, meanwhile, has launched a legal counteroffensive to the ban. Last week the group staged a massive lobbying effort on Capitol Hill aimed at tweaking the nation's gambling laws to make online poker completely -- and clearly -- legal.

"The fact of the matter is the genie isn't going back into the bottle,'' said John Pappas, executive director of the alliance." Internet gaming, particularly Internet poker, is an industry that's not going away.''

Pappas' pitch to lawmakers is this: don't lump poker into the same ``gambling'' category as other casino games, and use legalization to both protect U.S. consumers and raise tax revenues for the federal government.

The poker-isn't-gambling argument hinges on recent court rulings and academic studies that found poker to be primarily a game of skill -- though luck is of course still a factor.

Pappas' group has spent $400,000 in the past three months on lobbying efforts. Last week's intense legislative push included more than than 100 meetings with members of Congress and their staff, as well as a charity poker tournament in which some lawmakers took part. The alliance says it has assembled a petition with more than 375,000 signatures supporting online poker.

One of poker's biggest allies in Congress has been U.S. Rep. Barney Frank, a Democrat from Massachusetts. Frank has filed two bills this year benefiting poker -- one that would legalize online games, another that would delay the adoption of those stricter Dec. 1 banking regulations.

Alex Havenick, vice president of Miami's Flagler Dog Track -- which boasts an 18-table poker room -- welcomed the possibility of loosened online poker laws.

"It would be good for our business,'' he said. "It would give people who are afraid an opportunity to practice before they come into the room.''

That many players essentially graduate from online to live table play is only one of the ways in which online poker rooms and their bricks-and-mortar counterparts are heavily intertwined. A large chunk, if not the majority, of participants at heavily-televised poker events like the World Series qualified for their seats by playing online.

Should Internet poker be legalized, there are some big casino corporations such as Harrah's that are expected to pursue their own poker websites.

Not all traditional casinos are big online boosters, however. Dan Adkins, CEO of Hallandale Beach's Mardi Gras Casino, says poker is still fundamentally a social, in-person game that involves interacting with those around you. And Adkins questions whether websites, which typically try to exclude minors from their games, are truly up to that task.

``Exactly how would that work?'' Adkins asked. ``Does someone come through the screen and say `Yeah, you look OK, can I see your driver's license?' ''

Others defend the web as a great poker learning tool, with plenty of free games for those just starting out.

Mercier, the would-be math teacher who ditched his career to become a poker pro, honed his craft by playing online.

"For a young kid that's under 21, if you want to make it in the poker world, you basically have to go through online poker,'' Mercier said. "I was able to play for three years before I even tried to play live events. . .it definitely helped me improve.''

Mercier is now one of dozens of pros who have signed endorsement deals with Pokerstars, the world's largest poker site. Not surprisingly, it's an offshore gambling company, based in the Isle of Man.

When at home in South Florida, Mercier steers clear of local casinos and heads online -- where he can play for higher stakes and participate in eight to 12 games simultaneously.

"It's still legal in Florida,'' Mercier said, though he acknowledged some people "don't really know whether or not they can play online, so they just don't.''