Lame Duck Congress Could Ban Regulated Online Casinos

Corey Goldberg Updated on December 20, 2016
Lame duck online gambling ban
For some time now billionaire founder, chairman and chief executive officer of Las Vegas Sands Corporation, Sheldon Adelson, has been doing everything in his power to pass a ban on internet gambling.

But now, for the first time, the bill may actually gain traction.

When could the ban occur?

During the current lame duck session, Congress could pass legislation to “restore” the 1961 Wire Act, effectively halting states from legalizing online casinos and potentially ending the already booming online gambling industries in Nevada, New Jersey, and Delaware.

A spending bill that Congress could vote on by the first of the year is a potential vehicle to insert an online gambling prohibition, much like the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) was added to the SAFE Port Act which otherwise regulated port security.

Why the online gambling prohibition has a chance

Adelson has given incredible sums of money (nine figures) to Republican campaigns. Proponents of regulated online gaming fear that legislation to prohibit online casino games would serve as “payback” for Adelson’s generosity.

Adelson has stated that online casinos have hurt the brick-and-mortar casino industry and in 2013 said that he would “spend whatever it takes” to enact a ban on online gaming.

Last month, a group wrote to Vice President-elect Mike Pence, urging him to consider the Restoration of America’s Wire Act (RAWA), which would, by all intents and purposes, ban online gambling in United States.

The letter was signed by 10 attorneys general who opposed online gaming.

What is being done to stop this legislation?

Lame duck online gambling banAlthough Nevada Attorney General Adam Laxalt was one of the 10 attorneys general who co-signed the letter, Nevada State Representative Dina Titus sent a letter to both President-elect Donald Trump and Vice President-elect Mike Pence to urge them to resist such a ban.

“The letter submitted by the attorneys general contains several inaccuracies and unfair allegations,” Titus told Fox News. “I encourage you (Trump) to carefully study this issue before making any decisions that would infringe on state’s rights or eliminate jobs in the gaming industry.”

Standalone legislation to ban online gaming has been unsuccessful in the past, and a similar bill was shot down last year, but now with several Republican congressmen such as Mike Lee, Charlie Dent, Tom Cotton, Jason Chaffetz and Lindsey Graham on board, the prohibition could become a reality.

What would happen to iGaming?

Tom Cotton, who is the junior United States senator from Arkansas, introduced the latest standalone RAWA bill in September, and although the details are muddled at this time, its purpose is clear.

The legislation strives to “ensure the integrity of laws enacted to prevent the use of financial instruments for funding or operating online casinos are not undermined by legal opinions not carrying the force of law issued by federal government lawyers.”

The future of legalized online gambling

Although online gaming is currently only legal in three states, Nevada, New Jersey, and Delaware; several other states are looking to legalize online gambling in the near future.

If Adelson is unable to pass a federal ban on online gaming, Pennsylvania, Michigan, California, New York and Massachusetts could all have legal online casinos by 2020 resulting in an industry worth upwards of $4 billion.

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