Sheldon Adelson Doesn’t Really Want To Ban Online Gambling

Sheldon Adelson says he wants to ban online gambling. But does he really?

Sheldon Adelson says he wants to ban online gambling. But does he really?

That seems like a strange conclusion to draw about Sheldon Adelson, a man who has said his “moral standard” requires him to spend “whatever it takes” to block online gambling – an activity he’s described as a “cancer.”

But I’m not sure what other conclusion you could reach after reviewing the Restoration of America’s Wire Act (RAWA) – the federal bill that Adelson has put his considerable financial and political influence behind.

RAWA is a simple bill, just a bit north of 400 words. And for a bill ostensibly meant to ban online gambling, it spends an odd amount of those words doing more or less the opposite.

RAWA contains lucrative exemptions for several forms of online gambling

All told, RAWA contains exemptions for dozens of online gambling products that see billions of dollars wagered annually.

The exemptions begin when RAWA carves out any activity exempt from the definition of “bet or wager” enshrined in the UIGEA. The most visible member of this group: online fantasy sports betting, including daily fantasy sports, where American consumers in 45 states ponied up around one billion dollars in entries during 2014.

And any future product that meets the broad guidelines of the UIGEA exemption would also be permitted under RAWA. And if the guidelines are broad enough to allow DFS through, it’s not hard to imagine a varied array of products following suit.

Exemptions continue when RAWA excludes online horse betting, which sees hundreds of millions wagered each year, and whatever “charitable” gambling (itself a multi-billion dollar, often for-profit industry) states permit to operate online in advance of the Act.

Finally, since the Wire Act can only apply to interstate transmissions, any closed-circuit online gambling offerings – such as the mobile casino and sports betting products offered to guests at Adelson’s Venetian in Las Vegas – would not be impacted by RAWA.

The picture painted by this aspect of RAWA is a curious one: Online betting is a problem for Adelson. Unless it’s online betting on horses, fantasy sports, on-property mobile casinos, anything that might be justified under the UIGEA’s broad exemptions or conducted under the auspices of charitable gambling.

RAWA does nothing to address illegal online gambling sites

Despite the fact that illegal offshore online gambling is the most readily available (and utilized) type of online gambling for Americans, RAWA provides no new powers or funding to advance the ability of U.S. officials to crack down on the activity.

In fact, the bill is completely silent on the subject. Again, an odd position to take if one’s goal is to eradicate online gambling at large.

So what does RAWA actually ban?

RAWA’s only direct impact would be to ban legal online gambling authorized by lawmakers in some dozen states.

New Jersey and Delaware would see their regulated online poker and casino industries – industries that support hundreds of jobs and are backed by tens of millions in investment – shuttered overnight. Same for online poker in Nevada.

And states like Georgia, Illinois and Michigan would be forced to choose between millions in additional revenue from their online lottery programs and violating federal law.

Combined, those initiatives represent a single-digit percentage of the total amount Americans wager online each year.

RAWA leaves the rest untouched.

So I’ll ask again – does Sheldon Adelson really mean it when he says he wants to ban online gambling?

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Chris Grove

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