Committee Members Line Up Against Chaffetz' Restoration of America's Wire Act

Did We Just Witness The Death Of RAWA In A Congressional Hearing?

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Congressional hearing on Wednesday might be looked back on as the day that a proposed online gambling ban officially died.

Opponents of the Restoration of America’s Wire Act were found throughout a House Oversight and Government Reform Committee hearing — not on the witness panel, but on the committee itself.

The bill itself didn’t come up for a vote — the hearing was informational only. But nearly every representative on the committee that voiced an opinion either openly opposed RAWA — HR 707 — and the prospect of an online gambling ban throughout the U.S., or at least called into question whether it was a good idea.

The hearing was titled “A casino in every smartphone — law enforcement implications” and was a de facto reason to consider an online gambling ban via RAWA. That bill was introduced by OGR Committee Chair Jason Chaffetz and would ban several forms of online gambling in the U.S.

The start of the hearing

Chaffetz opened the hearing with the rhetoric that proponents of RAWA have trotted out over the past couple of years:

  • That the Department of Justice changed the Wire Act, against the intent of the law, with a 2011 letter, to only cover sports betting.
  • That “walling off” the internet via geolocation is not possible.
  • Verifying that minors are not gambling online is impossible.

For example:

“For anybody to argue that the internet can be walled off and used in just these certain boundaries, it’s a joke, come on,” Chaffetz said, although at least one witness and several committee members did exactly that, later on in the hearing. “No one with a straight face is going to come before the American people and say, well the internet, it’s just for the people of Nevada, or it’s just for the people of Rhode Island.”

Also, Chaffetz tried to say that RAWA is actually a “states’ rights” bill, countering claims that RAWA flies in the face of the Tenth Amendment. He made the roundabout argument that RAWA protects states that don’t want to have online gambling in their states (like his home state of Utah).

Most of those tenets on which Chaffetz bases his opinion have been debunked (Wire Act intent here; regulated gaming sites in New Jersey and Nevada have had no breakdowns in age or location verification). And then comments and questions from representatives on the committee almost seemed calculated to further diminish the stance of Chaffetz.

Given the tone of the comments coming from the committee, it seems difficult to believe that RAWA, at least in its current form, could possibly pass a committee vote, let alone get widespread support in the full House of Representatives.

Rep. Bonnie Watson Coleman (D- New Jersey) — a state that has regulated online gambling — offered the counterpoint to Chaffetz’ stance, that regulated online gambling is far safer than the alternative of banning it.

“The evidence clearly demonstrates that with proper regulation, in-state online gambling poses no more challenges to law enforcement or risk to consumers than brick and mortar casinos,” Watson Coleman said. She also showed slides demonstrating geolocation technology, directly refuting Chaffetz’ earlier statements.

The witnesses

The four witnesses at the hearing spoke from prepared testimony:

  • Joseph Campbell, Assistant Director FBI Criminal Investigative Division, who spoke about potential criminal activity that could arise from online gambling.
  • Alan Wilson, Attorney General of South Carolina, who spoke in support of RAWA and the proposed federal prohibition on online gambling.
  • Donald W. Kleine, Douglas County Attorney, who spoke of the difficulties of local law enforcement in dealing with online gambling.
  • Mark Lipparelli, Nevada State Senator and former Nevada Gaming Control Board Chairman, who spoke about the successes of online gambling in Nevada, specifically, and in regulated environments (like New Jersey) generally.

Signs that the hearing would not go according to Chaffetz’ plan came as soon as the committee membership was allowed to ask questions and give their take on the proposed online gambling bill.

By the end, even RAWA-friendly witnesses Wilson and Kleine admitted they have no real problem with intrastate online gambling — if it truly can be contained to individual states — just interstate online gambling. Of course, RAWA would end even intrastate iGaming and poker.

Things start going downhill for Chaffetz, RAWA

Rep. Thomas Massie (R- Kentucky) was up first, asking Campbell how prevalent online gambling is in criminal activity (i.e. money laundering), one of the charges against iGaming from Chaffetz, RAWA supporters, and other opponents of online gambling.

Campbell noted one example of such a case — in very vague terms — and did not indicate if it resulted in a prosecution. Massie pressed him if there were any examples from the three states where there is regulated online gambling; Campbell would not commit to saying there were none, and said he would have to look into it.

Massie also hit on one of the themes of the hearing: State’s rights. Republicans and Democrats alike questioned why a federal law should be enacted to take away the right of states to do as they see fit with online gaming.

A difference between legal and illegal online gambling

Watson Coleman was back on the microphone in the Q&A session, and identified another theme that would emerge throughout the course of the hearing — there is a big difference between regulated online gaming sites in Nevada, New Jersey and Delaware and the unregulated offshort sites that Americans can also access from any state.

She also questioned Campbell about whether the FBI had found any criminal activity going on via regulated sites; again, he said he did not have an answer to that question.

She also was one of many committee members who asked “softball” questions of Lipparelli, asking him to describe why the regulated environment in places like Nevada allows for the ability to stop criminal activity and money laundering in a way that cannot be done at unregulated sites.

“If you were going to try to launder money, a legal regulated site would probably be the last place that you would want to try to do that,” Lipparelli said.

Committee members: Largely a chorus against RAWA

Almost irrespective party lines, OGR committee members seemed to have problems with the intent of RAWA.

  • Rep. Mick Mulvaney (R- South Carolina) questioned Wilson, his state’s attorney general, for his stance on RAWA — “I didn’t expect you to be on this side of this issue.” He said Wilson was generally against federal intervention, but in this instance, he was for it. Like Massie (and others later), Mulvaney had major issues with RAWA vis a vis the Tenth Amendment.
  • Rep. Jody Hice (R – Georgia) said he was “opposed to all gambling,” but noted he also supported states rights’ via the Tenth Amendment. He noted his state’s lottery was looking into online sales, and he was concerned that RAWA would harm his home state.
  • Rep. Stephen Lynch (D – Massachusetts) said that he believed that RAWA would simply push online gambling offshore.
  • Rep. Dina Titus (D – Nevada) said the idea that RAWA strengthens states’ rights was “jabberwocky.”

And the list of those questioning RAWA went on. Other than Chaffetz, the only truly sympathetic voices for RAWA were Rep. Glenn Grothman (D-Wisconsin), a RAWA co-sponsor, and Rep. Gary Palmer (R – Alabama).

The bottom line: If there’s any support for passing RAWA out of the OGR committee, it certainly was not on display on Wednesday. And that may mean this committee hearing could serve as the eulogy for RAWA.

- Dustin Gouker has been a sports journalist for more than 15 years, working as a reporter, editor and designer -- including stops at The Washington Post and the D.C. Examiner. He has played poker recreationally for his entire adult life and has written about poker since 2008.
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