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Online Poker Expected to Get Another Look From Congress in 2010

1/01/10 - Fort Worth Star-Telegram - View Source

By Anna M. Tinsley

Jeremy Jones had his suspicions.

When playing poker on the Internet, he would occasionally see some players put all their money in the pot for nearly impossible-to-win hands — and still win.

"The odds of them hitting were less than 5 percent, yet they go ahead and make the money," said Jones, a 25-year-old Fort Worth landman with an oil and gas company. "I have never been able to prove it, and every online player will tell you the same thing: Sometimes there are hands that happen online frequently and hardly ever in a real card game.

"With literally hundreds of millions of dollars changing hands every day, surely someone smart enough could figure a way around the security."

Last month, the FBI said as much, telling a congressional committee that Internet poker games — unregulated by the government — can be manipulated. That committee, led by Rep. Barney Frank, D-Mass., is reviewing a bill to reverse a 2006 law that bans banks from transferring money to gaming sites, which prevents Americans from gambling online using their credit cards.

"There are several ways to cheat at online poker, none of which are legal," FBI Assistant Director Shawn Henry wrote in a letter to a member serving on the committee, according to recent news reports. "It would only take two or three players working in unison to defeat the other players who are not part of the team."

In the fall, the Federal Reserve and the Treasury announced that they would give U.S. financial companies until June 1 to comply with the 2006 Unlawful Internet Gambling Enforcement Act, which has yet to be enacted. Frank and others had asked for the delay in hope of overturning the law before it takes effect.

Poker players say legalizing online poker not only would let millions of dollars being used in gambling be taxed but also could bring stricter guidance and oversight to the game, which could reduce cheating.

'Not a crime’

Frank, who has pushed for measures to legalize online poker, has filed HR2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act, geared to license and regulate online poker sites. He would like to see online poker legalized so the government can capture taxes.

More than 60 co-sponsors have signed on, including two Texans: Reps. Ron Paul, R-Surfside, and Ciro Rodriguez, D-San Antonio.

Other measures have been filed to overturn the 2006 law or further delay its implementation.

Some businesses have found ways around the ban, from operating overseas to letting players use offshore accounts or foreign credit cards.

Poker players went to Washington, D.C., last year to present a "Poker is Not a Crime" petition signed by more than 350,000 people.

"We are all for overturning the ban," said Mike Lavigne, the Texas director of the Poker Players Alliance and founder of the Texas Poker Political Action Committee. "The organization has been actively involved in lobbying Congress, and members have been communicating with their congresspeople.

"Poker is one of the few genuine grassroots movements left."

Looming problems

But Henry, of the FBI, says he is concerned that the FBI doesn’t have the resources to monitor online gambling to determine that all players are of legal age.

Robert Martin, tribal chairman with the Morongo Band of Mission Indians in California, posted a note on the House Web site saying that legalizing Internet poker will put tribes running casinos at a disadvantage.

"The legislation will do nothing but legalize off-shore gaming," hurting thousands of workers employed by the Indian gaming industry, Martin wrote.

And compulsive gamblers say they fear that such a move will increase addiction.

"I get calls every week on my 888-LAST-BET help line from Internet gamblers," said Arnie Wexler, former executive director of the New Jersey Council on Compulsive Gambling.

'A Wild West affair’

The sooner lawmakers act to legalize gaming, the better, said Michael Bodsky, executive chairman of California-based Inc., which oversees online bets on horse racing.

"Illegal Internet gambling in the U.S. is happening now and growing," he testified in front of the committee. "It’s a big business involving billions of dollars a year.

"[It’s] a Wild West affair; no meaningful curbs on underage gambling, no recourse for misdirected funds, no attempts to aid problem gamblers and no tax revenues for the U.S."

The House Financial Services Committee didn’t vote on his bill last month, but some say the issue is expected to come up again this year.

In the meantime, Jones said he has scaled back his online poker play from about 10 hours to one to three hours a week. He primarily sticks to no-limit hold ’em tournaments.

"After reading reports about widespread cheating, I decided to cut back, just playing when I have free time when before I would make free time to play," he said.

But he said he hopes that online poker is legalized.

"Poker is not a game of chance like roulette or craps or blackjack," Jones said. "The player is not playing against the house, just other humans playing the same game you are.

"Government regulation will lead to better security as well; after all, the money will be taxed."

There are several ways to cheat at online poker, none of which are legal."

Shawn Henry,
an FBI assistant director, in a letter to a lawmaker

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