THE WAR AGAINST ONLINE GAMBLING
Can the US government stop the fun?

by norton weissner
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One increasingly wonders at the misnomer we hear so often, "the land of the free". As the United States government becomes more and more paranoid about activities within and without its own borders, and fundamental crusading christains once again hold the reins in the White House, online gamblng has taken blow after blow in its face and yet is still standing strong. The events of September 11th 2001 haven't helped the cause as the government, truthfully of otherwise, has targeted the online gambling industry as a potential ally to money-laundering terrorists. But before we look at the facts, let's make one thing crystal clear: the war against online gambling - as with all of the US government's internal 'wars' - is a war against personal freedom. The enemy "personal freedom" is an enemy no government has ever conquered for long, especially in a nation like the United States with such an unerring tradition of freedom.

The story begins in 1994 when Antigua became the first country to issue gaming licenses. From that moment on, the word "offshore" no longer needed to be qualified by the shore referred to. Many other countries followed suit, including the United Kingdom. British online gambling companies moved offshore to the Channel Islands to avoid taxation, not legal action. Since then, the anti-gambling section of the US government has repeatedly tried and failed to ban internet gambling, either by introducing new legislation or by attempts to revise the old Wire Act which prohibited betting via the telephone. By 1998, led by Rebublican Senator Jon Kyl of Arizona, new legislation was being introduced to curb Internet gambling, legislation which failed to make it through the House of Representatives. Helped by Representative Goodlatte, the anti-online gambling campaign continued unsuccessfully to try to introduce the legislation they desired, claiming that their concern was under-age gambling and gambling addiction, although one suspects their motives may have been less pure. Other interested parties were also involved, in particular the Indian gambling industry - who were against online gambling for obvious reasons - and the mainstream gambling industry who opposed the origin drafts of the legislation which they saw as against their vested interests.

Meanwhile, as the state of Nevada got closer and closer to legalizing online gambling within their own state, the number of online gambling outlets rose from an estimated 700 in 1999 to an estimated 1,800 "offshore" gambling websites in 2003, hardly evidence of a losing battle. As the inevitable prohibition of the use of credit cards and bank transfers for online gambling loomed ever nearer and credit card companies and online payment processors such as Paypal changed their policies, new systems of payment sprung up, such as the Canadian Netteller and Flexcard (yes, blame Canada). Offshore banking became increasingly popular and increasingly easy as offshore countries were happy to supply to the demand.

Finally, in 2003, it looks like the anti-online gambling legislation will finally be passed but by now it has been so modified and watered down to appease the different interest groups that the legislation looks nothing like a bill of prohibition but instead like a bill of regulation with a strong bias towards the interests of the existing gambling industry, mainstream and Indian alike, also leaving the way open for individual states to legalize gambling within their own borders in the future. Offshore hosting and banking has replaced stateside equivalents, new payment systems have replaced the mainstream credit card companies, and the future still looks rosy for the thriving and resilient online gambling industry.