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December 19, 2014

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D.C. to offer Internet gambling, becomes first in the nation

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Sam Morris

A woman who wants to remain anonymous plays poker online.

The District of Columbia is becoming the first U.S. jurisdiction to allow Internet gambling, trying to raise millions of dollars from the habits of online poker buffs and acting ahead of traditional gambling meccas like New Jersey and Nevada.

Permitting the online games was part of the 2011 budget and a 30-day period for Congress to object expired last week, said D.C. Council member Michael A. Brown, who authored the provision. The gaming would be operated by Intralot, a Greece-based company, and would be available only to gamblers within the borders of the district.

Officials were not sure when the gaming would be up and running, though DC lottery officials said they were in talks with their vendor and expect to know more within weeks. Though other states have contemplated legalizing online poker, experts said the district would be the first jurisdiction in the country to do it.

The move to legalize the games comes despite a 2006 federal law that effectively banned Internet gambling. The law basically prohibited banks and credit card companies from processing payments from gambling companies to individuals. But the law is murky, and gambling experts say it created enough grey areas to open the door for a deeper expansion into the multibillion dollar industry.

"There was really no clear law that said we could not do this," Brown said Wednesday.

D.C. hopes to tap those millions to help offset budget cuts and help social services programs, Brown said. Conservative estimates from D.C.'s chief financial officer indicate the district could bring in around $13 million to $14 million through fiscal year 2014, according to Brown's office.

The gambling green light is no doubt good news to poker players, but D.C. would be authorized to offer other games of both skill and chance. It would be up to lottery officials to come up with regulations and decide which games to permit.

"Anytime you're cutting budgets and you want to save some programs, you're looking for different pieces from different pots and you hope that you get to the number that restores those budget shortfalls and that's what we're trying to do with this," Brown said.

Jeff Ifrah, a lawyer whose firm represents online gaming companies, said he was dubious about any revenue estimates since they naturally assume that online poker players will migrate from their favorite site to a new one endorsed by a state.

"Players are really loyal in this industry," Ifrah said. "You really have to ask yourself what is the incentive a player is going to have to leave a trusted site with global competition to play in a site that's untested and kind of unknown and doesn't offer you the same level of play."

Online poker games generally allow computer users to deposit money into an account and place wagers against other players similar to real gambling.

Efforts to legalize Internet gambling have stalled elsewhere this year, including in New Jersey, where Gov. Chris Christie vetoed a measure partly out of concern that bars, nightclubs and amusement parks would add online gaming to attract more customers.

A bill in Hawaii died in the Legislature and another one in Iowa is unlikely to move forward in its current form. In Nevada on Tuesday, a legislative panel amended and approved a bill that directs the state Gaming Commission to begin drafting rules to regulate online poker. But the bill also stipulates that Internet gambling would not be implemented until sanctioned by Congress or the Justice Department.

David Schwartz, director of the UNLV Center for Gaming Research, said he thought states were waiting for clearer federal guidance before proceeding with Internet gambling proposals.

"There's a lot of ambiguity at the federal level," he said. "A lot of people are waiting for some sort of federal legislation that would create a regulatory structure."

A spokeswoman for the U.S. Justice Department, which has traditionally viewed Internet gambling as illegal, declined to comment Tuesday.

D.C. Mayor Vincent Gray said Tuesday he didn't know how far along the process was but added, "Assuming it's implemented it would become a part of our lottery program and could generate additional resources for the District of Columbia as we continue to support ourselves."

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  1. This is very understandable. Count the number of Christians in the Senate and House of Representatives and you will see an overwhelming majority.

    The degree and DIRECTION to which their Religious and moral influence is felt on Washington DC can be expected to guide the rest of the Country. As the morals of Washington D.C.go, so goes the rest of the Country. What happens in D.C. happens anywhere.

    Bring your Bibles to Bingo - its the latest rage.

  2. Bad, bad, bad move. The District of Columbia will reget this decision. It won't take for the negative effects to overcome the short gains. This is foolish and irresponsibile of the part of decisions maker in control of DC.

    Where in the hell are the reasonable and responsbile officials in the United States of America?

  3. OK Washington, SDC - you are asking for it with Internet gambling.

    "Give me your tired, your poor, Your huddled masses yearning to breathe free, The wretched refuse of your teeming shore. Send these, the homeless, tempest-tost to me, I lift my lamp beside the golden door!"

    Evidently, all those kind of people who live in Washington, DC, will be living next to "the golden door" - and will have the ability to lose a paycheck that they cannot afford to lose, now.

    But the powers that be in DC are just fueling the "dreamers" who actually believe you can win at on-line poker (or at a real table).

    I am not against gambling, in fact I bet the HARD 8 everytime Lady Luck tells me its coming (and I have been mostly winning for about 30 years). But I only bet ONCE (win or lose) when I think a HARD 8 is coming out, and then only $5.00. But it is "fun" FOR ME; not gambling like on-line or table poker would be - hand after hand.

    I am sorry that people will become addicted to it, in their own home, while their family watches the bread money go "down the drain" after supper.

    But then, the politicians in Washington, DC, never were very smart. I lived there for over 20 years, and Marion Barry was the Mayor many years ago, and using cocaine. But the people RE-ELECTED him in recent times. What were they thinking? I guess he fronts for them so well, that they don't care who is in office.

    Now, with BILLIONS spent in on-line gambling in the United States every year, the "home-burning" gambling begins FOR REAL in Washington, DC (and Nevada, and elsewhere) where dumb politicians are ready to "invade" the home.

    With such ease of access - (they don't have to travel to Las Vegas or Atlantic City any more; and they don't even have to get dressed either!) - I hope they will still be able to pay their mortgage, and feed their kids.

    I thought we were in a recession with 30 million people out of work!? Well, to each his own. Good luck!

  4. There is a curious footnote that I can add here.

    In the earliest years of our nation, Wash D.C. and its environs was where the biggest gambling took place; both at the numerous "gambling hells", and at the very nearby racetrack in Virginia.

    This was long before the Mississippi riverboats existed; and New Orleans was not even part of the U.S.A.