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Gaming Report: New Wire Act Opinion Under Fire From New Jersey & Pennsylvania AG’s, Sports Betting Bill Passed by Virginia Senate & More

Gaming Report Cover Feb 7
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  • Attreyee Khasnabis February 7, 2019
  • 6 Minutes Read

In the latest update surrounding the US Department of Justice’s (DoJ) reversal of its interpretation of the Wire Act, attorney generals of New Jersey and Pennsylvania, Gurbir Grewal and Josh Shapiro respectively, have jointly penned a letter to the DoJ expressing their objection and clarifying the possible impact this may have on the economies of both states.

The south-eastern state of Virginia is on the path to become the newest state to not only legalize sports betting but to also allow land-based casinos to operate within the state.

However, online gambling site Tambola has landed itself in trouble with U.K.’s Advertising Standards Authority (ASA) and had to revoke their ads from a TV app.

Meanwhile, the Dutch Remote Gaming Bill was yet again delayed by the Senate which has now asked Justice Minister Sander Dekker to provide detailed, written responses to three questions by February 8.

Wrapping up our report is news of the Russian Federal Tax Service (FTS) that had 16 gambling sites added to its list of companies with which Russian financial institutions are forbidden to do business.


New Wire Act Opinion Under Fire From New Jersey & Pennsylvania Attorney Generals

The reversal of the US Department of Justice’s (DoJ) interpretation of the Wire Act is facing heat from the attorney generals of New Jersey and Pennsylvania. Gurbir Grewal, AG of New Jersey, and Josh Shapiro, Pennsylvania’s AG, wrote a letter to the DoJ stating their objection to the reversal.

Gurbir Grewal & Josh Shapiro
Gurbir Grewal & Josh Shapiro

The previous interpretation of the law, before DoJ’s reversal, only applied to interstate sports betting. With the reversal, the DOJ claimed that all forms of online gaming would be subject to the Wire Act. The new opinion basically outlawed all gaming that crossed state lines.

With New Jersey and Pennsylvania making up the second and third biggest gambling markets in the country following Nevada, the reversal deeply impacts their economy. Grewal and Shapiro clarified in their letter that the new opinion affects state-sponsored lotteries, and will cost many citizens their jobs, and negatively impact state tax revenue.

“The opinion casts doubt not only on traditional online gaming, but also multi-state lottery drawings (such as Power Ball and Mega Millions) and online sales of in-state lottery tickets,” they said in their letter. “This decision puts jobs and livelihoods at risk for the thousands of people who work in the online gaming industry and jeopardizes critical state funding for the public good that is generated by lottery sales and other internet activity that is legal within our states.”

In addition to filing the letter, Grewal also filed a Freedom of Information Act request to find out if Sheldon Adelson was involved in lobbying the DOJ to make the change. “The New Jersey FOIA request seeks information on any communication involving Adelson, his lobbyists, the White House, and DOJ regarding the relevant federal law and online gaming,” said the state’s officials in a press release.

The DoJ has given states 90 days to comply with the new ruling.


Sports Betting Bill Passed by Virginia Senate

The latest state to allow sports betting following the dismissal of the PASPA Act of 1992 is Virginia. The south-eastern state is ready to allow land-based casinos to operate, while also legalizing sports betting.

Virginia State Flag
Virginia State Flag

Virginian Democratic Senator Louise Lucas introduced a bill called SB 1126 which stated the details of legalization of casino gaming which the Senate passed on February 4. The legislation was passed by a vote of 28 to 12 and may well lead to the setting up the state’s very first casino. The bill will be sent to the House of Delegates for its approval and thereafter will go to Governor Ralph Northam. After his signature, the final decision-makers will be the voters.

The bill includes provisions for casino games like poker, blackjack, slot machines, baccarat, craps, roulette along with sports betting in the proposed Bristol Resort and Casino, as well as making the way for the establishment of land-based casinos.


Tombola Obligated to Rescind Gambling Ad From TV App in UK

Online gambling site Tambola was recently in a fix with the Advertising Standards Authority (ASA) of the U.K. and had to retract their ads from ITV’s “I’m a Celebrity … Get Me Out of Here” app.


According to The Guardian, the ads were disliked by its target audience which happened to be the viewers of the popular reality show. The show’s nearly 12 Million strong audience, which includes 1 Million who are under-the-age of 18 years, use the app to place votes. Tombola’s ads, if clicked, would bring the user directly to their online gambling site, thus becoming easily accessible to almost a million under-age users.

Tombola defended the practice by citing cooperation with ITV to target an 18+ audience. Although their studies showed a 91% audience aged over 18, the 9% that were under-age was objectionable to the ASA.

Labour party’s deputy leader Tom Watson lauded the ASA, stating “Gambling ads should not be on apps that will clearly be used by kids. It’s simple.”

Commenting on their action against Tombola, the ASA commented, “We considered Tombola Arcade should not have used the app to deliver gambling ads to consumers. We therefore considered the advertiser had not taken sufficient care, through the selection of media, to ensure that the ads were directed at an audience aged 18 and over so as to minimise under-18s’ exposure to them.”


Dutch Remote Gaming Bill Hits a Roadblock in the Senate

The Netherlands’s Remote Gaming Bill stumbled on a roadblock on February 5 when after a long delay it was under review by the Senate.

Sander Dekker
Sander Dekker

The bill, which was approved by the legislature’s lower chamber in 2016, aims to launch an online licensing regime that would be open to international operators. The Senate has been delaying discussions on the bill for quite some time now. On Tuesday, along with debating on the Remote Gaming Bill, the Senate was also debating the Casino Reform Bill, which aims to complete the long-delayed privatization of Dutch land-based gaming monopoly Holland Casino.

The debate took a surprising turn when senators demanded that Justice Minister Sander Dekker provide detailed, written responses to three questions.

First, the senators requested for an exact definition of ‘illegal operator’ and whether any operator tagged with this scarlet letter can be legally excluded from participating in the newly regulated online market.

Second, senators also wanted to know what specific measures Dekker was proposing to restrict gambling advertising via online channels, in particular social media, and the legal basis underpinning these restrictions.

Lastly, senators wanted to know what laws currently exist that would permit the Dutch government to block the domains of gambling sites not holding new Dutch licenses.

During his time on the Senate floor, Dekker argued in favour of the Netherlands licensing as many international operators as possible in order to ‘channel’ the bulk of existing Dutch online gamblers toward the regulated market. Dekker cited Denmark as the model to emulate and Norway as the model to avoid.

Dekker promised to deliver his detailed responses to these questions by February 8.


More Gambling Sites Added to Russian Payment Processing Blacklist

Russian gambling affiliate Bookmaker Ratings reported on February 6 that the Federal Tax Service (FTS) had added 16 names to its list of companies with which Russian financial institutions are forbidden to do business.

Russian Federal Tax Service
Russian Federal Tax Service

The first company added to this list was the Curacao-licensed online casino Azino777. The newest inductees to the list include four locally familiar gambling faces: Baltsport NV (Baltbet), Betcity Network NV (Betcity), Pari-Match NV (Parimatch) and Leon International Ltd (Leon).

All four hold Russian online sports betting licenses but also operate internationally-licensed sites that offer casino, poker and other gambling products that remain illegal in Russia. The internationally-licensed sites of each operator also feature regularly on the online gambling domain blacklist of Russia’s telecom watchdog Roskomnadzor.

Russia approved its payment-blocking legislation in May 2018, but it wasn’t until much later in the year that the government finally started to put pressure on local banks to implement the process. Under the new law, banks have five business days after a company is added to the payments blacklist in which to stop processing payments on behalf of the offender.

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