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Ever since online gaming regulation became a state-by-state issue following the DOJ letter about the Wire Act in 2011, the National Council of Legislators from Gaming States (NCLGS) has become more involved.
Formed in the mid-90’s, NCLGS is neither pro- nor anti-gaming, but rather “is primarily concerned with the proper regulation of the industry.”
In 2012, NCLGS released a strong pro-states manifesto in direct response to the Reid-Kyl federal online poker bill, which would have removed considerable iGaming regulatory authority from individual states.
Most recently, NCLGS has announced that it is partnering with UNLV’s Gaming Research Institute to create a sound interstate iGaming policy framework, for which public input is being solicited until January 31, 2014.
The 2014 NCLGS winter meeting took place in Hollywood, Florida from January 10 through 12. Numerous representatives from gaming states attended, with the subject of online gaming being covered throughout various sessions.
Of significant importance, especially in view of the aforementioned pro-states position taken by NCLGS against federal legislation, was the appearance by American Gaming Association President Geoff Freeman, who delivered the keynote address on the first day of the conference.
Since assuming his role as new leader of the AGA, Geoff Freeman has dramatically shifted the Association’s position on Internet gambling, which had historically been one of opposition.
Even in the later years of Freeman predecessor Frank Fahrenkopf Jr’s tenure, the AGA had supported a mild poker-only version of online gaming federal legislation – and one which, as NCLGS itself made clear, was decidedly unpopular among states for its overly broad regulatory intentions.
Freeman opened by making it clear he respects state authority on gaming matters, be they online or offline, not to mention the seniority of those who have been around in gaming for longer than he has.
“You guys know a hell of a lot more about gaming than I do,” said Freeman, who was chief operating officer for the U.S. Travel Association prior to joining the AGA.
“I’m really interested in hearing from you (the states),” he remarked.
Freeman assured attendees that the AGA will not concern itself with lobbying at the state level, but he wishes for the Association to remain involved in a way that can help the industry “tell its story” and “dispute the falsehoods” often attributed to the gaming industry by its detractors.
While the likelihood of a federal iGaming bill’s success has diminished since the Reid-Kyl days, Freeman hangs on to the belief that the federal government can still participate in the expansion of safe Internet gaming.
For example, a set of “minimum standards” is something Freeman sees the AGA and the federal government being able to help with, along with recommendations for a “streamlining” process that can expedite iGaming licensing applications.
Intrastate regulation of iGaming, Freeman clarifies, would and should be left up to individual state agencies, even in the event of a federal presence.
Freeman reiterated his unkindness toward unlicensed operators who are “not playing by the same rules.”
He cited as an example the Internet sweepstakes cafes that had been giving Florida authorities a headache for some time until they were shut down last year by legislative mandate.
“This is a heavily regulated and scrutinized industry. But what we found is that there are a lot of folks who want to make a buck off the industry, but they don’t necessarily want to play by the same rules as the industry.
You’re going to see the AGA much more active in squashing those bugs out there who are trying to make a buck but who don’t want to live by the same regulatory standards and don’t want to make the same commitments as states and localities. Those entities that are participating in an unregulated manner are targeted by the American Gaming Association, and you will see us much more active in that space.”
The best way to combat illicit participants such as offshore Internet gaming operators, Freeman argued, is not by prohibition, but through regulation.
Freeman acknowledged Las Vegas Sands CEO Sheldon Adelson’s zealous efforts to “fix” the Wire Act (ban online gaming nationwide).
According to Freeman:
“The AGA strongly opposes [Adelson’s] position. We appreciate Las Vegas Sands’ support of our organization and their membership, but we strongly oppose their approach [to Internet gaming].
We cannot force the Internet back into the bottle. We no longer have to debate about ‘do we want online gaming or do we not want online gaming.’
Online gaming is here. The question is, are we going to regulate online gaming, in a way to protect minors, prevent criminal activity, reap tax revenue and other benefits, or are we going to allow the black market to continue to thrive?”
Asked if he foresaw AGA playing a role in assisting interstate iGaming policy, Freeman had this to say:
“For the foreseeable future, the AGA’s efforts with regard to online gaming are going to be focused on preventing prohibition.
What’s done at the state level, in terms of compacts or whether states have poker-only or all games online, I’ll leave that to other interested parties.
Our organization’s focus is on making sure that states have the ability to move forward. When it comes to compacts or poker-only, none of that will matter anymore if the other side is successful in getting prohibition through Congress.”