Poker Blog and Poker Gossip

There are many nice thing about charity events.  Chief among them is the fact that you get to participate in a game that you love, and give back to a very good cause; lately there are no shortage of good causes to give to!  Also, there are the prizes.  Not typically a monetary prize, but with a well sponsored event, the swag you can potentially walk away with is usually worth it, if you’re in the giving mood!

With that in mind, Full Tilt has partnered with Pokergives.org for a $5 +$5 charity event taking place 2pm (ET) April 4th 2010 (Full Tilt Tournament ID: 137275439 Password “PokerNations”).  Pokergives.org is a non-profit organization that states on it’s website “No Board Members or Founding Members will receive a salary in the expectation that a minimum of 95% of all funds raised will reach the charities. All efforts will be made to keep the administrative costs of maintaining the site to 5% or less.”  The charities that Pokergives.org supports are: The Special Olympics, Intrepid Fallen Heroes Fund, Paralyzed Veterans of America, and the Step by Step Foundation.

The Prizes
I talked up the prizes at the beginning of this article, and they are absolutely worth while; particularly when you factor in the fact that it’s a charity event.  The prizes range from poker sunglasses from Blue Shark Optics, a home game set from DB Dealer, a one-year subscription to Bluff Magazine, six months of poker coaching from Deuces Cracked, poker books, card protectors, a $200 gift certificate to Andrew Shirley and Company, and private coaching sessions with Johnson, Delk, PokerXFactor’s Chris “Fox” Wallace, and Michael “tuna_fish_tank” Stroh.  Entrants can also receive a one-month CardRunners Gold Subscription, Texas Hold’em strategy cards, a one-year membership to the Down to the Felt Club, a one-year subscription to Australia Poker Weekly, and a PMS PokerWear prize pack.

To be eligable for the prizes you need to go to the PokerNations Forums and post your Full Tilt user name in the associated thread.  After posting your info (note: you do not need to provide anything other than your user name!!), and most likely registering at the forum, you will receive a one month membership to the Down to the Felt Club (retail: $25).  

It seems like even with the UIGEA deadline 4 months away, and the mad scramble the last time it was about to take effect to give a six month “research” extension, no one really wants to talk about this.  There are countless news stories talking about how big names are for legalizing online poker (and taxing it), and an equal number vilifying it and are anxious for the UIGEA to take effect.

Well, all that being said, the Conservative Political Action Conference started on February 18, and in attendance were the PPA (Poker Player Alliance), including Greg Raymer.  Their goal is to help some pretty big names on the conservative side of politics see that Online gambling is good, and government telling you when and where you can spend your money is a bad thing.  But the ultimate goal is to get more politicians and people with influence (including Mitt Romney, Ann Coulter and Glen Beck) on their side.

“I think a true conservative is someone who wants little or no government in his life,” Raymer told Card Player after attending the 2009 conference. “He doesn’t want the government to tell him what to do.”  The PPA will argue that is exactly what the Unlawful Internet Gambling Enforcement Act, which is due to go into effect on June 1, is trying to do by prohibiting credit-card companies from processing certain types of financial transactions.  “Certainly someone who’s a good conservative is going to say that if it’s an activity that is engaged by an adult who is mentally competent, if they’re not hurting other people, I’m just going to have to … let them do it,” said Raymer.

It’ll be interesting to see if there is another extension to UIGEA come June 1, or if they will just scrap it and start over. 

With most states and the Federal Government in desperate need of cash, and the well organized machine that is the PPA, it appears that most “Experts” agree that legalizing online poker is an inevitability.

Andrew Parmentire and David Katz were on CNBC’s “Closing Bell” making these arguments, and i believe they are right on the money.  This discussion started with Parmentire stating that Chairman Barney Frank put the bill out there, and a lot of other factors are lining up very well.  Harrah’s is showing that they have an online strategy, and with a workable strategy, and a huge need for state and federal cash flow it is just a matter of time (and additional financial stress) until online gambling is legalized.
With the Democrats pushing social programs and no new forms of revenue for the federal government to fund these programs; and with Gambling in the US becoming a more acceptable consumer product.

During the interview, Katz made some excellent points about the longevity of “Brick and Mortar” casinos, the capacity with which they can grow to serve the needs of the many, and the way that online gambling can help to increase revenue through both creating jobs in the economy (someone needs to run the servers, work at call centers, design the programs, etc), and creating new publicly traded companies to invest in.

Excerpt from the interview:

Katz stated to CNBC viewers “Gambling in the U.S. has become a far more acceptable consumer product than it was five or ten years ago. That said, we really are much more focused on the publicly traded companies and that would be the brick-and-mortars like Harrah’s as well as the game providers and the technology companies that support those industries.”  Harrah’s inked an agreement with 888, the parent company of Pacific Poker, to fill its online gaming needs. 888 is a publicly traded company in London, where it can be found under the same three-number acronym. Katz explained that with casinos slowly reaching their limits in the live space, the switch to the Web is inevitable: “If you go to the Bellagio, they have a couple of hundred seats to sit in, so there’s a physical constraint. If you look at the number of states out there that are considering legalizing gaming, they’re going down every year. There’s a finite opportunity for the brick-and-mortar guys to expand in the United States and at some point, they have to start thinking globally.”

With the December 1st deadline of the Unlawful Internet Gambling Enforcement Act (UIGEA) looming, and Geithner and Bernanke not yet responding to the PPA’s request that the December 1 deadline be postponed a year, this fight is just heating up.  Things have changed a lot since 2006 with the UIGEA was first approved in the House of Representatives, and it will be interested to see if the bloated government is willing to act for the betterment of itself and it’s people.

With all the other things that congress and the American leadership in general has to deal with these days, I’m not sure this is going to work.  But it appears that the Safe and Secure Internet Gambling Initiative is putting lots of money out there to support Barney Frank’s bill. 

On the other hand, the way they’re advertising it, it might just get something done.  Here is a quote from Jeffery Sandman (spokesperson for the safe and secure Internet gambling initiative) on the benefits of legalizing and taxing online poker:

“As Congress searches for ways to pay for health care reform and other worthy programs, it should end the unsuccessful prohibition of Internet gambling and start collecting taxes on the billions in revenue currently lost to unlicensed, offshore gambling operators,”

The ads will appear in several online publications, including The Huffington Post, Political Wire, Washington Post and Politico and will focus on different messages.  Some will highlight how the new legislation would protect consumers, some will compare the outlawing of online poker to prohibition of the 1920’s, while others (and i think these will be the most successful for getting people to listen up) will give an overview of how much money could be generated from taxing and regulating the already popular online activity. 

It seems like a no brainer to me…Legalizing online poker (gaming) give everyone what they want.  Online gamblers get a system they can rely on, and as long as the taxes aren’t astronomical it can easily stay profitable for winning players.  The government gets billions of dollars to line their pockets with  ahem..spend on health care…..everyones happy!

Safe and Secure Internet Gambling

Man, I’m a much bigger fan of writing posts about a sick beat, or 4 guys making 2 million in 2 months (i still don’t think they’ll do it….) but this whole legalization of online poker in the wings is a huge deal, and has wide ranging repercussions. 

If the states does “legalize” online gaming, there is a huge chance it will be limited in some way, and it will for sure have a taxation element on the deposit side, and maybe on the cash out side (a-la a brick and mortar casino).  The taxation element alone may make playing online as a profession in the states a thing of the past, as it would totally neutralize the profits you could make.  I’ve even heard rumors of the Government taxing poker winnings on the website, and then taxing the player on their income taxes.  Game of skill, right? 

Recently, however the US has shown why regulation and legalization of Internet gambling is not needed.  It’s not needed because they are making tons of money on settlements with major online gambling sites that are (or were) operating within US borders. 

This past Friday BetOnSports founder Gary Kaplan presented his case in federal court.  During the proceedings he agreed to turn over $43.6 million in settlement monies.  This comes soon after PartyGaming agreed to a settlement of $105 million (semi-annual payments, ending Sept 2012).

Two different online gambling portals.  Both had Head Offices outside of the US.  Both agreeing to pay hefty sums of money to “avoid prosecution” and hopefully avoid going out of business. 

I think Larry Belfor said it best:
“With the current system in place, there is no need for the US to rush into legalization and regulation of Internet gambling, they are making plenty of money by busting overseas operations and then having them pay to get out of potential trouble.”

For Online Poker Players in the USA, today marks the first steps on the long road to legalization. Senator Menendez (New Jersey) has introduced the Internet Poker and Games of Skill Regulation, Consumer Protection and Enforcement Act. 

This bill is a comprehensive clearing of the gray areas around Online Poker, mandating a rigorous licensing process based in the US (rather than off-shore), criminal and credit history checks of executive officers, a comprehensive and detailed report on financial history as well as a generalization about the company’s structure and it’s affiliates.  I’m sure this is to ensure that they aren’t licencing a money laundering organization, or other unpalatable organization to handle millions of dollars in good faith, which is good news really.  

It appears that this bill is looking out for the player as well! A self-exclusion policy is to be ordered (do these really work??), as well as strict age restrictions.  You MUST be 21 to participate in legal online gambling, and the bill makes it very clear that the responsibility is on the games room (with strict penalties, I’m sure). 

But wait, there’s more!  There is no way the government would let a cash cow like this go unnoticed, and taxes are as sure as death and…..hand grenades?  Maybe that’s horses.  But i digress.   The governments rake, ahem..cut…will be 5% of the licensee’s deposits.  This will be taken every month, and any unauthorized gambling sources will be taxed by 50%.  How they would be aware of such things is beyond me, but i guess they need a deterrent.  The money will be added to the general coffers (not sure if they mean federal or state).  A $200,000 study on pathological gambling is also set to be funded by the proceeds of this endeavour. 

If this bill gets passed, i wonder if they’ll have a grace period for online poker rooms to get their licences, or if they will need to have their licence before doors can re-open (legally)?  Will that 5% tax be handed directly to players? How much money would a poker room need to pay to get their licence in the first place and will this prevent the “little guy” (are there little guys in the online poker ring?) from opening up a new site, or is the wealth of new players incentive enough to pay the licensing fee? 

At least the regulations being proposed seem much more reasonable than the ones Italy has implemented.  United States, you have surprised me!