Columnist Dean Juipe: Internet gaming gets scrutinized

Dean Juipe

Wednesday, Jan. 10, 2001 | 10:36 a.m.

Dean Juipe's column appears Monday, Tuesday, Wednesday and Friday. His boxing notebook appears Thursday. Reach him at juipe@lasvegassun.com or 259-4084.

To see them portrayed on television, they're living the life of Riley.

Tropical islands. Golf every day. Millions of dollars in income at their disposal.

All because they're located outside the United States boundaries and operating a successful Internet sports gambling site. By the looks of things, the money rolls in nonstop.

CBS' "60 Minutes" did a piece on the subject this week and it's a topic that will be addressed at length in Las Vegas Thursday through Saturday at the American Gaming Summit at the Bellagio. A seminar entitled "Gaming's Future and the Internet" is certain to be well-attended.

With the NCAA imploring the U.S. Congress to outlaw legalized gambling on collegiate sports, offshore sports gaming is more pertinent than ever. From Nevada's perspective, money that was once being spent here on sports wagering is already being siphoned to offshore sites, and if betting on college games becomes illegal throughout the country in 2001 -- as it very well might -- even more cash will be redistributed to the "pirates" that operate outside U.S. jurisdiction.

It is estimated that there are currently 1,000 Internet gaming companies and that they netted $10 billion in business last year.

The company that "60 Minutes" looked at (entitled World Sports) is based in Antigua and its three owners claim they take 20,000 bets -- from $10 to a maximum of $20,000 -- every NFL Sunday. "It's been real profitable so far," one of the men said with grandiose understatement, his chip shot to a beautiful green on some luscious golf course awaiting.

Sports gaming is a huge industry in Nevada, which is the only state in the union where it is legal. But the long arm of the U.S. law is attempting to bring offshore gaming under U.S. jurisdiction, and the three World Sports owners were charged in a test case that seems to have brought mixed results.

With U.S. Attorney General Janet Reno saying "You can't go offshore or online and hide," and with the U.S. Senate looking at the Internet Gambling Prohibition Act that would handcuff offshore wagering, there has been a concerted effort to bring the offshore industry under control. Yet it may be fruitless, given that World Sports, for example, is breaking no laws in Antigua and that its U.S. customers are using credit cards to make their wagers.

One of World Sports' owners returned to the United States to answer the charges and was found guilty on eight counts and sentenced to 21 months in jail. He's currently out on appeal.

Chances are good that neither he nor anyone else currently operating an offshore sports gaming site will ever be incarcerated in America. Among the many defenses those people are using is a three-card monte approach of asking why lotteries are legal in this country and why casinos are able to sell alcohol to gamblers. In addition, they claim that the 1960 Wire Communications Act is not applicable in this matter.

Like it or not, the offshore firms appear to have a solid defense and if the U.S. government wants to chase after this subject it may have to target the bettors instead.

Nevada's best interests are only a small piece of the puzzle, and perhaps irrelevant at that.