Editorial: Inane deal should be scrapped

Wednesday, Nov. 1, 2000 | 10:21 a.m.

Las Vegas Mayor Oscar Goodman tried Monday to soften opposition to the city's possible involvement in an off-shore Internet gambling operation based in Australia. Goodman -- who has recused himself from evaluating the project because he learned Tuesday that his law firm had represented one of the company's investors on an unrelated matter -- suggested Monday that the city hook up with the Internet company for a three-month trial period to see how this would work. The mayor also said Monday that the revenues the city could receive from the partnership could be used to provide a property-tax rebate for residents. But the city shouldn't be involved in this scheme with VegasOne.com, not even for one day.

On Monday the Las Vegas City Council held a hearing to get more input on this proposal, which only recently surfaced. At the last City Council meeting, Goodman set off warning bells when he said the City Council should move with "alacrity" on this plan. The bottom line is that this proposal would put the city at risk -- if not monetarily, its reputation has the potential to be tarnished if there were a scandal. And for all the talk that there would be a foolproof scheme to keep Americans from betting on this site, Councilwoman Lynette Boggs McDonald noted that Nevada Gaming Control Board agents were able to place an illegal wager in Australia by routing it through a server in Canada.

It also should be clear that the Internet company has proposed nothing more than a "fox-guarding-the-henhouse" type of regulatory oversight. That's because the city, which would provide its seal and good name to the Internet company in return for a share of the profits, would also be in charge of nominal regulation of the site. Leaving aside for a moment the monumental problems of regulating worldwide betting from Las Vegas, it's difficult to imagine the city trying to diligently uncover wrongdoing if it also is a partner in the venture. The city also doesn't have the manpower or, more importantly, the decades of expertise to adequately regulate gambling as does the state Gaming Control Board.

Even if the city somehow could overcome the legal and regulatory hurdles inherent in this plan, the fact is government shouldn't be involved in such an activity, especially since Internet gambling is illegal in the United States. Even if one day Internet gambling is legalized, it should be left to the private sector; government has no business competing against privately run casino companies. The City Council should pull the plug on this ill-conceived plan.