NEW JERSEY SPORTS BETTING BILL

Will Online Poker Benefit from the Death of PASPA?

Last week, the talk of the gambling world was the overturn of the Professional and Amateur Sports Protection Act of 1992 (PASPA), a law which made sports betting illegal in the United States, aside from four states that were grandfathered in. With PASPA obliterated, states are now free to legalize and regulate sports wagering; a few states, including New Jersey, are expected to do so within weeks with more possible getting things done by the end of the year. The big question on the minds of poker fans now – besides “When are you going to stop writing about non-poker topics?” – is, “How is this whole PASPA deal going to affect online poker?”

The short answer is that it probably won’t, at least in the short term. PASPA is a sports betting law. It has nothing to do with poker, online or otherwise. Thus, as the logic goes, PASPA going the way of the buggy whip isn’t going to launch online poker industries in dozens of states. Besides, if states were going to legalize online poker, they would have done so already. And as we know, only New Jersey, Nevada, and Delaware, have regulated online poker sites up and running, with Pennsylvania likely to come this year.

Remember, the UIGEA didn’t make online poker illegal. It made the financial transactions for “unlawful” internet gambling illegal. States were still allowed to legalize and regulate the game within their own borders. The poker sites and executives who got nailed on Black Friday in 2011 were found to be in violation of the UIGEA; their crimes revolved around disguising the source of gambling payments. Later that year, the Department of Justice’s Office of Legal Counsel’s clarification of the Wire Act made everyone realize once and for all that states could legalize online poker. Nevada did so in 2013 and now, five years later, we have a grand total of three states with poker sites. Like I said, if states were so eager to launch online poker industries, they would have done so already. PASPA has nothing to do with it.

Could online poker piggy back on sports betting legislation? *shrug*

In the long term, it is possible that PASPA’s overturn might help online poker. Might. The opportunity here is for online poker to ride sports wagering’s coattails. Not as a separate legislative initiative, mind you – inertia is too powerful a force – but as a passenger in a sidecar in a more inclusive gambling expansion bill.

This is basically what happened in Pennsylvania, though there had been discussion of online poker regulation for a number of years. Last fall, the Governor signed a gambling expansion bill that legalized online poker, daily fantasy sports, sports betting (pending PASPA), and online lottery, along with increasing the locations where brick-and-mortar gambling could take place.

Sports betting would generate many more tax dollars than would online poker, so sports betting is a much more attractive prospect for lawmakers – even those who bristle at the idea of gambling, internet or otherwise – than is poker. But unrelated legislation gets tacked onto bills all the time, so in this case, where online poker does actually have some connection to sports betting, it is certainly possible that elected representatives could bundle them together. If lawmakers work hard to write up a solid sports betting bill and are thus presumably interested in expanding gambling and reaping the monetary benefits, they could be convinced to let online poker tag along. Poker has worked just fine in Delaware, New Jersey, and Nevada, so other states wouldn’t have to reinvent the wheel.

The Poker Players Alliance is clearly thinking along these lines. In a press release, PPA president Rich Muny said:

This is a great decision for consumers who for years have had no alternative to wager on sports other than the black market. It presents states with the perfect opportunity to establish sensible policies not only to regulate sports wagering, but also other forms of gaming, including internet poker. Whether you are betting on sports or playing poker, lawmakers must make it a priority protect consumers. The states that have already regulated internet poker have proven that it can be done in a way the benefits consumers and governments. It makes sense for states that are eyeing sports betting to also realize the benefit of regulated iPoker and iGaming.

“Today marks an important date for the future of gaming in the United States,” Muny added. “The future of sports betting will continue to rely on internet and mobile technologies, and this is also true for all gaming. Now more than ever, states should take control of unregulated internet poker and sports betting and create systems that protect adult consumers and provide governments with new streams of revenue.”

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