House of cards is unfairly stacked against internet

[Stephen]

House of cards is unfairly stacked against internet

By Nigel Payne Our correspondent argues that the recent spate of web-based gambling arrests is rooted in commercial protectionism

THE key to a proper understanding of what is happening in the internet gambling industry is to look at the agenda of some of those who seek to criticise it. I believe that the real picture that emerges is one of fiscal protectionism that is being masked by political manoeuvring and adroit public relations. A good example is the often-quoted issue of under-age gambling. We are told that the industry is a social pariah, a danger to children. Although internet gambling may provide the ability for minors to participate in unsupervised gambling, the truth is that the industry has long been able to demonstrate that it has the technology to mitigate such risks. One company that offers this sort of technology is the respected American firm Aristotle, via its Integrity software platform. Like the alcohol and tobacco industries before it, internet gambling has, with its partners, listened to the very real concerns that have been raised and addressed them. A regulator overseeing a properly regulated industry would be able to insist that such software be used and monitor its application. And it works. Yet the politicians and authorities that raise this concern and seek to criticise the industry choose to ignore that there is a technological solution. The US House of Representatives recently passed a Bill — H.R.4411 — to “ban internet gambling”. A central pillar of the Bill was that the industry is “a risk to the children of America”. What struck me as odd was that the House never asked whether technology existed to mitigate the concerns. Moreover, the Bill lists a number of internet gambling activities, including horse racing and fantasy leagues, that would be exempt from any ban. No explanation is offered about why such activities should be exempted, nor why children might be at risk from, say, a bet on a hand of poker but not from a bet on a horse race. The situation is similar in Europe, including parts of Scandinavia, the Netherlands, Hungary and, more recently, France. In many of these countries the industry is portrayed as an evil business that targets the young and vulnerable, yet all have domestic internet gambling businesses that are approved and licensed by the local government but without any obligation to provide social responsibility controls. This protectionism is particularly evident in the United States. The so-called ban proposed in Bill H.R.4411 is not a ban at all, but a measure that authorises certain forms of internet gambling while excluding others. It expands internet gambling betting opportunities on racing, fantasy sports, lotteries and intrastate and intratribe gambling and yet fails to set a minimum age requirement. It is probably no coincidence that the exempted activities are almost exclusively controlled by US companies. Ironically, by using restrictions on banks as one of its enforcement measures, the Bill is denying the industry access to the sort of data that may prevent non-US gaming operators from verifying the age of potential customers, identifying problem gamblers and preventing money-laundering. So what is the real driving force behind these exemptions? Consider fantasy sports. In my opinion, it meets the legal definition of gambling, is illegal under the US Professional and Amateur Sports Protection Act of 1992 and is almost certainly illegal under the Interstate Wire Act of 1961. Crucially, the professional sports leagues in America — the same leagues that are lobbying hard for internet gambling to be banned — receive direct and indirect revenues from fantasy leagues. In July the National Football League started a service with Sprint, the telecoms company, to provide fantasy tracker updates via mobile telephone — a deal worth an estimated $600 million over five years to Sprint. The actions being taken by governments to achieve their aims — including Congress’s “prohibition” Bill, the detention in France of BWin’s joint chief executives and the arrest of Peter Dicks, my former colleague, on a warrant issued in Louisiana — run the risk of compromising the most socially responsible operators and forcing punters to use companies that do not take such issues as seriously. This industry operates over the world wide web, not over a country-specific web. Eventually governments will have to reach agreement about how this and other “www” industries are to be handled. Operators would welcome this. Most have offered to pay appropriate taxes and there is no question that operators would respect relevant laws. But the price of this respect must surely be a level playing field. Nigel Payne is the chief executive of Sportingbet

The full article can be found here:
http://www.timesonline.co.uk/article...0-2376726.html