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Expert Negative about US Online Gambling

By: Adam Baker, Sunday September 27th 2009
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At the recently concluded European i-Gaming conference there was general optimism on online gambling legislations in the United States. However, at the International Masters of Gaming Law conference in Amsterdam, Tony Cabot painted a dismal picture, providing compelling reasons why the proposed legislations supporting online gambling in the United States are likely to fail.

Cabot has over 23 years of experience in gaming law. He is a founding member and past president of the International Masters of Gaming Law Association. He began by reiterating the position that has now become clear. No action is expected on Barney Frank's anti-UIGEA legislation this year due to more pressing matters with the House committee. In any event the Democrats have got too much on their plate. They are in a tight corner on issues of health care and the economy. Next year the election cycle will begin. Therefore the Democrats are unwilling to provide any rallying point for the Republicans. Cabot said, "...the last thing the Democrats want to get involved in is an unpopular fight because the Republicans would be all over it." And the pro-online gambling legislation can prove to be one such rallying point for the Republicans.

In order for the legalization of online gambling to move ahead it is essential that the Nevada Senator and Democrat Majority Leader Harry Reid throw his weight behind the movement. But as of now Reid is sitting on the fence because his constituency consisting of the land casinos of Nevada is divided on the issue. Harrah's has been backing online gambling legislation because they want a slice of it. But there are many interests in Nevada lobbying against the legalization of online gambling. There is a general view that such a move would provide competition for the land based casinos. Therefore Senator Reid is likely to withhold his support.

Adding a new dimension to the argument, Cabot said that the present online gambling operators functioning in the United Sates are also not keen on legislation like Barney Frank's bill. Today they have an exclusive control of the United States online gambling market with the leading European operators not having a foothold. If online gambling is legalized in the United States the position could reverse. The foreign operators with clean slates or fresh grassroots companies could enter and bag the major share of the licenses. The existing operators are also afraid that they may be deprived of the licenses because they are challenging the current American administration. Therefore the present American online gambling operators are also not willing to wholeheartedly support the anti-UIGEA bills.

Cabot gave Barney Frank's bill 20 to 1 odds of success. He concluded that the pro-online gambling movement would never succeed at the federal level. He opined that the state-level initiatives have a greater chance of success. Many of the organizations involved in this movement such as the Poker Players Alliance and iMEGA have also expressed their intention of focusing more on states that are willing to legalize online gambling, if only to tide over their resource crunch.

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Comment by: casinowizard On: September 28, 2009
I have to disagree with this point of view. I beleive that an anti-UIGEA bill will be passed as it's a precursor for paving the way to full on regulation and a simple milestone that I think needs to be achieved before any further goals can be reached.

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