While many Americans wonder whether Internet gambling should be legalized, gaming industry leaders are looking a few steps ahead and considering some of the specifics of taking wagers online in a regulated environment.
One thing is clear: Industry representatives know they have to educate lawmakers and the public about Internet gambling, especially in the wake of recent industry scandals, in order to win approval and gain players’ trust.
How online gaming — particularly Internet poker — should be regulated, how it would be taxed and how the industry would prevent the wrong people from playing were discussed today in a panel on online gaming’s legal landscape on the opening day of the four-day Global Gaming Expo at the Sands Expo Center.
G2E’s trade-show floor, featuring gaming floor innovations and new slot machines, opens Tuesday with a ribbon-cutting by actor Dan Aykroyd, whose image is used in IGT’s new “Ghostbusters” slot machines .
About 25,000 people are expected to attend the nation’s largest gaming industry event and hear keynote speakers Penn Jillette, the vocal half of Las Vegas entertainers Penn and Teller, and Jim Murren, CEO of MGM Resorts International.
G2E is open only to industry professionals, and more than 100 panels on various gaming topics are scheduled.
In the online gaming discussion, panelists said the industry expects to get an assist from Fair Play USA, a newly organized coalition of law enforcement officials, consumer protection experts, poker players, casino companies and others concerned about Internet gambling.
Industry officials are hoping the organization can deliver the same awareness of industry technology and specifications that the Poker Players Alliance accomplished with its explanation of online poker market demand.
Panelist Jan Jones, senior vice president of communications and government relations for Caesars Entertainment, said her company is optimistic that federal legislation would be approved as long as the industry explains the safeguards that can be imposed for online games. Caesars has been a longtime supporter of the legalization of online poker to exploit its World Series of Poker brand and attract millions of customers who congregate online.
Reps. Jim McDermott, D-Wash., John Campbell, R-Calif., and Barney Frank, D-Mass., and Senate Majority Leader Harry Reid have introduced Internet gambling and related taxation legislation, but it’s unclear when those bills would be debated.
“The worse thing they (legislators) can do is not do anything,” Jones said when explaining some of the various policies that are being debated in an online environment.
Assurances that underage players or people living in states where play is illegal can’t access games are key to legalization, she said. She said she has seen demonstrations of technology that puts prospective players through a series of checks to verify identity before they can play.
Panelist Dan Walsh, senior director of governmental affairs for the Greenburg Traurig law firm, said players could be asked about their mortgage payments and records could be cross-checked to verify the age of a prospective player based on bank records.
Walsh agreed there could be several “false negatives” in the application process, but that would assure someone under the legal age wouldn’t be able to play.
Panelists said industry leaders also are considering:
• How online poker companies should be taxed. Differing legislative proposals have versions suggesting that a tax be imposed on the company when money is deposited to a player account, while others suggest imposing it after a withdrawal. Industry officials say taxing on deposits could stick companies with paying a tax even if a player changes his or her mind and decides to withdraw without playing.
• What percentage companies should be taxed. Industry officials worry that the government’s insatiable appetite for revenue could lead to a growing tax level over time.
• Whether recent online poker scandals would change the habits of players. Some believe recent problems for players accessing their accounts could result in more players making a deposit, playing and then withdrawing all funds instead of keeping funds in the account, which could create some accounting nightmares.
• Whether state or federal government regulators should have jurisdiction over online poker. Some believe one federal agency should oversee the industry, while others believe states that have experience in gaming regulation should do it.
• Whether Internet gambling should be an “opt-in” or “opt-out” decision for states. The industry would prefer the federal government pass legislation that would enable Internet gambling nationwide, but allow states to make decisions on prohibiting their own residents from playing. “It would be a huge compromise on our part to have opt-in because in many states, that’s a difficult process,” Jones said.