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American Gaming Association Support Reid’s Poker Bill

Posted on December 14th, 2010

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Senator Harry Reid, despite negative feedback from some casinos, continuous to push for the legalization of online poker in the United States. If the law passes, it will initially only allow casinos which already have an existing license from the state government or Indian tribes to offer online porker. This will last for around two years. Opposition by some smaller casinos have been expressed because the new bill would cut from their profits. However the American Gaming Association has expressed its support for the new bill. The association represents more than 440 commercial casinos in the United States and is responsible for over half the gambling revenue of the government. The group’s chief executive made a statement saying “Current online gambling laws do not provide these safeguards, leaving players and the system open to fraud, cheating and other illegal acts.”

The bill would allow casinos to protect their interests from players who might take advantage of the internet, a diverse and new medium upon which the games would be hosted in. Hackers and defrauders have become a very common problem for most if not all persons who use the internet as a tool for business. Online gaming in the United States stopped in 2006 because of a law that prohibited money transactions between payment sites and banks for use of the credit card to pay for gambling sites. The law has since been the subject of debates.

The proposed bill would remedy this situation at least for the poker aspect of online gambling. Also the sites will only cater to Americans for the first 3 years. Licenses will also be only available to American casinos as previously mentioned, so international gambling sites will have to stop providing online gambling in the United States. Furthermore the bill limits online gambling in the United States to only poker. All other forms of internet gambling are prohibited by the bill. “I still have serious concerns about legalizing the broad range of casino-type gambling through the Internet,” Reid said. “The bill I am working on would make other types of Internet gambling clearly illegal, while increasing penalties and strengthening the ability of law enforcement to shut down illegal sites.”

This is also his strongest argument against some of his critics’ comments regarding this bill being the first step to online gambling legalization. Reid also said that he doesn’t want to make games like blackjack and other casino money making games available online because this would take away customers of local casinos. He chose poker because the players are playing against themselves and there is minimal profit from it on the part of the casino. One of the companies who stand to make a lot of profit from this bill is MGM Resorts International, incidentally one of the senator’s strongest supporters. “The combination of a large player database, multiple highly recognizable brands and a significant number of physical venues should translate to an important critical mass of players online and therefore disproportionate share,” said Bill Lerner, analyst for MGM Resorts.

The opportunity mentioned above will be something that all license grantees will be looking to grab. There will be a greater market with diverse demands. The poker sites will have to come up with new and profitable means of meeting these demands. Meanwhile, with all the momentum generated by the proposed bill, the opposition are prepared to stop it at all costs. Despite Senator Reid’s promises to only allow the legalization of online poker, opponents of the bill believe that it would cause unwanted side effects. These, they claim, would come as a result of loopholes that could easily be exploited. Supporters, though, continue to be adamant in their contention that the bill would necessarily provide a great deal of protection to players while at the same time providing a huge income for the state in terms of tax revenues.

As with most issues concerning the legalization of online gambling, this will most definitely stay in the headlines for a long while—the outcome of which is fairly undecided at this time.