Quebec Looking To Force ISPs To Block Gambling Sites In Order To Protect Its Own State-Run Gambling Portal

from the there's-nothing-more-sincere-than-a-government-entity-ensuring-its-own-exist dept

Should a government body attempt to block websites for its own financial gain? [To anyone that answered "Yes," I say, "Really?"] This question doesn't seem to be troubling Quebec's government, which submitted a budget that contained the following -- all without uttering a single word like "conflict" or "interest."

In its budget released Thursday, the province said it plans to propose new legislation that would compel Internet service providers (ISPs) to block access to a list of gambling websites drawn up by Loto-Québec.

Loto-Québec, of course, is the province's own revenue stream, which allows citizens to contribute extra funds to their government via games of skill. Great stuff for those who enjoy this more voluntary form of taxation, but the internet is full of other options. And that fact makes Loto-Québec very sad. But the government is always willing to cheer itself up!

The government states its aim is to direct revenues to its own gambling website, Espacejeux, noting Loto-Québec’s revenues have fallen in recent years and stating, “it is only the online gaming market that has growth prospects.”

So, it's hoping to double its money by doubling down on blocking "illegal gambling websites." It cheerfully estimates that -- if it can just get hesitant ISPs on board -- its gambling revenues will generate $13.5 million in 2016-17 and $27 million a year after that, apparently in perpetuity.

Now, there are a lot of fallacies in play here, not the least of which is that budgeted income will always meet planned figures forever -- a conclusion made while operating in a vacuum devoid of external circumstances, perverted incentives or the foibles of the public. But it has to get ISPs to agree to enforce Loto-Quebéc's blacklist first, and so far, ISPs aren't expressing any desire to force their customers into a government-created gambling funnel.

Bram Abramson, chief legal and regulatory officer for independent ISP TekSavvy Solutions Inc., said the proposed legislation raises concerns about the neutral role of Internet providers.

“ISPs are intermediaries and we do what we do best when we act a little bit like utilities: We provide access to the Internet. We should not be put in a position of picking and choosing what people have access to,” he said in an interview Friday.

This is all customers want internet providers to be… all over the world: dumb terminals that provide them access to the Web. They don't want government filtering/blockades, throttling, ISP portals, data caps or anything else governments/ISPs have in mind for them. They want an open pipe and access to the tap. That's it.

But like all of these listed efforts, this too is being done in the [what a crock] "best interests" of Quebec's internet users.

Quebec said the website blocking measure is also aimed at improving public health because “illegal websites do not apply the same responsible gaming rules as Espacejeux. They thus pose a risk to the population, especially young people.”

Ah, yes. The "young people." Who hasn't heard numerous stories about the lasting damages inflicted on unwary youths by rogue gambling sites? Why, it's practically Grand Theft Auto meets the Adult Video Awards in there!

The only thing troubling Quebec's government is the fact that these sites are horning in on its racket. Michael Geist calls it what it is:

…[A] “remarkable and possibly illegal plan as the government seeks to censor the Internet for its own commercial gain.”

And those behind the plan to possibly illegally censor the internet to prop up the province's flagging cash cow just keep doubling down.

In an interview Friday, Quebec Finance Minister Carlos Leitao said the measures are not in place yet but he believes implementing them is “perfectly feasible.”

“This applies to gambling sites, unlicensed gambling sites,” the minister said. “So I don’t think there’s an issue of censorship.”

And again, I must say, "Really?" How does a government-ordered blacklist of sites not veer into "censorship" territory, especially when the list of targeted sites was written by a government entity with both eyes on its own bottom line?

Beyond that, blocking doesn't work and it always causes collateral damage. Blocking illegalgamblinghotspot.tu might (MIGHT!) be acceptable (if a really questionable use of government power and resources), but doing so solely to hit budget figures dreamed up by imaginative government reps isn't -- especially considering the province has no direct control over telecoms, which would mean dragging Canada's federal government into this sloppy, ill-conceived turf war.

Filed Under: canada, competition, filters, gambling, online gambling, quebec, website blocking

Senators Goad DOJ Into More Pointless Online Gambling Takedowns

from the wanna-bet? dept

As we should all know by now, any potential moral qualm, whether minor or major, is roughly infinitely worse if you add these magical little words to it: "on the internet." Oh yes, people, don't you dare be confused. Prostitution, drug-dealing, and ghost stories are all bad, but if they're on the internet then we must all wage sanctimonious political jihad against them. Left out of the above examples is internet gambling, the process by which people who probably can't afford to lose their money hand it over to other people in games of chance in which the odds are stacked firmly against the former. But, while most (all?) states in our glorious union operate a lottery, and many others are home to horse/dog tracks, OTBs, and some flavor of casinos, online gambling is treated as the stuff of nightmares. This has resulted in misguided applications of legislation to shut down internet sports and poker gambling sites, all dressed up as an effort to create a more moral nation, when it's really all the result of heavy lobbying by terrestrial casinos.

Somehow, the DOJ's crusade against gambling sites had reached a lull as of late. A couple of folks in Congress aim to change that with a sternly-worded letter to Eric Holder.

“We must act before we find virtual casinos making gambling pervasive in our society, invading living rooms, bedrooms, and dorm rooms across the country; a result we know the DOJ does not want to see,” the letter said.

The letter was signed by Sens. Lindsey Graham (R-S.C.), Kelly Ayotte (R-N.H.) and Dianne Feinstein (D-Calif.), who earlier this year introduced a bill that would overturn a 2011 DOJ opinion that opened the door to online gambling.

Thank goodness for the nanny state, here to save us from doing...well...stuff we want to do. I love the entire concept behind this now-publicized letter to the DOJ, which essentially says: "The common people are lowly animals and if you let them gamble with their money, instead of doing the sensible thing and gamble invest it in Wall Street, the moral fabric we have woven for these plebes will unravel like it was a Weezer song."

Here's my counter-argument: go to hell, Congress. A government this bad at spending the money they take from me probably shouldn't be waxing on about how I spend what they graciously allow me to keep. Lindsay Graham in particular simply doesn't get to make this argument, given his love of shilling for land casinos on a manufactured moral wave.

In March, Graham and Rep. Jason Chaffetz (R-Utah) introduced a bill — backed by GOP megadonor and casino magnate Sheldon Adelson — to restore the pre-2011 DOJ interpretation of the Wire Act.

In their letter this week, the senators wanted [sic] that the 2011 ruling if “left on its own, … could usher in the most fundamental change in gambling in our lifetimes by turning every smart phone, tablet, and personal computer in our country into a casino available 24 hours a day, 7 days a week.”

Right! Those people should instead by driving to Sheldon Adelson's casinos to do all that same gambling that gives these congressmen the heebie-jeebies. That's the thing about trying to use morality as a basis for legislation: you had damned well better be consistent or you end up looking like a freedom-jacking bag of lies. All the more so when you're talking about telling the American people how they're allowed to spend their money.

Filed Under: dianne feinstein, doj, gambling, kelly ayotte, lindsey graham, online gambling, sheldon adelson

10 Years Later: Antigua May Finally (Really) Set Up Official 'Pirate' Site To Get Back What US Owes In Sanctions

from the watch-this-space dept

Well here's a story that's more than a decade in the making. Way back in 2003, we first wrote about Antigua filing for sanctions against the US for its ban on online gambling. Antigua argued (with fairly strong support) that this violated a trade agreement between the US and Antigua, by blocking a form of free trade. The case was at the WTO for years, bouncing around. In 2004, the WTO ruled against the US, which the US promptly ignored. In 2005, the WTO again ruled in favor of Antigua on the issue, and the US (stunningly) responded by pretending that it had won, when it most clearly had not. Following that, the US pretended that it could just unilaterally change its free trade agreement to carve out gambling. Not surprisingly, Antigua (and the WTO) found that to be problematic.

It goes without saying that the US is big and powerful and Antigua... is not. So, as it became clear that the US intended to ignore any WTO ruling, people began to wonder if there was any remedy for Antigua over this issue. Normally, the WTO could do something with trade sanctions against the US and in favor of Antigua, but given how much Antigua relies on US trade, that would likely hurt Antigua a lot more than the US. Somewhere in the midst of this -- around 2006 -- someone somewhere floated the idea that one way that Antigua could be made whole would be to allow it to ignore US copyright laws, allowing it to "sell" copyrighted content on the cheap, without paying any royalties. That idea took on a life of its own and Antigua began pushing the idea itself around 2007. The world community started to side with Antigua over this, recognizing that the US was being completely unfair here... and the US did what the US does, and bought off a bunch of big countries to get them to shut up and stop supporting Antigua.

In late 2007, the WTO finally said that this plan of retaliatory copyright infringement could go forward in Antigua, but limited to just $21 million worth of infringement. Even so, the US immediately warned Antigua not to even think about it, or it would retaliate. There were some negotiations between the two countries that went nowhere and then... a lot of nothing. We've barely touched on the story since 2008 when Antigua once again threatened to (no, really this time!) launch a copyright infringing store with "permission" from the WTO. But, that didn't happen.

However, reports are now coming out that Antigua finally has plans in place to launch just such a store. Of course, we'll believe it when we see it, considering the decade-long posturing over this issue. Oh yeah, and, once again, the US is warning Antigua not to move forward, claiming that Antigua is acting in "bad faith" and launching the store might "serve to postpone the final resolution of this matter." Considering that the US lost at the WTO nearly a decade ago, and still hasn't "resolved" the matter, that's a fairly ridiculous claim. And, of course, the US is threatening to "retaliate" if Antigua goes forward:

"In these circumstances, Antigua has no justification for taking any retaliatory actions against the United States. Moreover, if Antigua actually proceeds with a plan for its government to authorize the theft of intellectual property, it would only serve to hurt Antigua’s own interests. Government-authorized piracy would undermine chances for a settlement that would provide real benefits to Antigua. It also would serve as a major impediment to foreign investment in the Antiguan economy, particularly in high-tech industries."

So, the short version from the US's point of view is that it's fine to ignore its own trade agreements that wrecked a significant part of Antigua's economy -- but as soon as Antigua fights back and wins, it's not allowed to make use of WTO-approved remedies after years and years of the US refusing to fix its abuses. And somehow when it finally (years and years later) moves forward with this other plan... the US argues that it would harm its international obligations? The hubris from the US is (once again) incredible, if not particularly surprising.

Filed Under: antigua, copyright, online gambling, piracy, trade dispute, us, wto

Feds Continue Crackdown On Poker... By Seizing The Wrong Bodog Domain

from the keystone-kops dept

The feds domain name seizure powers seem simple enough (if of extremely questionable legality, seeing as domains involve speech which requires a higher standard to seize), so it really amazes me how badly they seem to regularly screw up in using them. The latest is the seizure of Bodog.com as well as the indictment of Bodog boss Calvin Ayre. While there's been lots of attention paid to the seizures of sites having to do with copyright and trademark infringement, the same feds (ICE and the DOJ) have also been using the same powers gleefully to stop you from playing poker online. You may recall that they seized PokerStars, Full Tilt Poker and Absolute Poker last April, followed up by 10 more domain seizures in May (which was especially bizarre, since the key thing that's illegal is processing payments, but in that case, the federal government set up its own fake payment processor for those sites...).

Bodog, however, has been considered the "big dog" of online poker for quite some time, raising some questions as to why it wasn't included in last years' busts. Of course, in typical fashion, the feds seem to have targeted the wrong domain. Bodog gambling sites moved off of Bodog.com ages ago -- first due to a patent dispute, and later to avoid having the sites on US controlled domains. For quite some time the company has mainly relied on bodog.eu, and more recently has been offering a different domain called Bovada.lv for US-based players.

As for Bodog.com? It had become the face of the "Bodog Brand" and was used for licensing the Bodog name, but wasn't itself a gambling site in ages. The affidavit for seizure (pdf and embedded below) claims that federal agents set up accounts and gambled on Bodog.com, but I really wonder if they didn't miss the fact that they were redirected to another site. Checking the internet archive, it certainly looks like Bodog.com was pretty much out of commission long before the feds claimed to have set up and used accounts there. Either way, the seizure seems unlikely to do much to stop gambling on Bodog sites, considering that the actual gambling was happening on sites, other than Bodog.com, which likely are still perfectly operational.

As for the actual indictment (pdf and embedded below) against the individuals, it's more or less what you'd expect. They focus a lot how Bodog moved money around, but much of that was only necessary because of the (relatively recent) decision by some politicians in the US to sneak an anti-online gambling bill into a bill about protecting our ports and harbors. Ever since then there's been a growing effort in Congress to actually make online gambling legal again -- in part because the big casinos who mostly supported the original ban have now changed their minds and want in on the action. In other words, while it is likely that Ayers and his team did violate the law, there are a lot of questions about the law itself, and there's a half decent chance that what he was doing will be perfectly legal before too long.

Kinda makes you wonder why the feds are spending their time and taxpayer-funded resources on such a thing, doesn't it?

As for Ayers, he sounds pretty defiant, suggesting that this is really just the feds acting in the best interests of large casinos who don't like the competition:

I see this as abuse of the US criminal justice system for the commercial gain of large US corporations. It is clear that the online gaming industry is legal under international law and in the case of these documents is it also clear that the rule of law was not allowed to slow down a rush to try to win the war of public opinion.

These documents were filed with Forbes magazine before they were filed anywhere else and were drafted with the consumption of the media as a primary objective. We will all look at this and discuss the future with our advisors, but it will not stop my many business interests globally that are unrelated to anything in the US....

The whole thing seems like a big waste of time by some federal officials who like big headlines, but don't seem particularly focused on stopping crimes that actually cause real harm.

Filed Under: calvin ayre, doj, domains, ice, online gambling, poker, seizures
Companies: bodog

Big Casinos May Now Regret That They Had Congress Ban Internet Gambling

from the oh,-whoops... dept

While there was all sorts of sanctimonious language about protecting children and the "sins" of gambling when Congress put a bill that effectively banned online gambling into a law about protecting our ports (don't ask), everyone knew the real reason why Congress banned online gambling: the big casinos were afraid of the competition. They even claimed that people wouldn't want to come to real casinos any more if they could just gamble online. It's like the claims of musicians when records first came out, that no one would ever want to see live music again. Or the idea that with a VCR, no one would want to go to the movies again. Of course, as with those situations, it turns out that the casinos are finally realizing that (1) they can actually profit directly from online gambling and (2) it probably drives more people to real casinos, rather than fewer. So, suddenly they're trying to convince Congress that it's okay to legalize at least online poker, completely at odds with what they've claimed in the past. Of course, you'll never see any of them admit that perhaps they made a mistake in getting such legislation passed in the first place...

Filed Under: casinos, legalization, online gambling, poker

Barney Frank's Attempt To Allow & Tax Online Gambling Moves Forward (Again)

from the with-caveats dept

Back in 2006, some politicians included a bill that effectively banned online gambling as a part of a law designed to protect our ports (don't ask what one has to do with the other). Pretty much since then, Rep. Barney Frank has been seeking to legalize online gambling (in order to tax it), and he just got a step closer to that as the House Finance Committee has passed a version of his bill. There were, not surprisingly, complaints against how this bill would "bring gambling into everyone's homes," but that ignores (of course) that it's already available in homes, and the feds have long admitted that they have no idea how to enforce the original law.

Of course, this is not the first time that the House Finance Committee has approved such a bill, and in the past it went nowhere. So, there's still a half decent chance that this really means nothing much.

Still, there are some interesting provisions in the bill, as a few amendments were added, including banning the companies who have currently been letting Americans play poker online from getting approved for a license. Yes, all of those online gambling sites who are still offering services and hoping this bill passes... may get shut out by it. Of course, they might have a pretty strong legal case that this is not legal, seeing as some courts have suggested that poker is not technically gambling. Another amendment would bar those who are behind in child support payments from visiting online gambling sites, though I don't see how they enforce that one.

Filed Under: barney frank, online gambling

Congressional Study Says $42 Billion Could Be Raised By Legalizing Internet Gambling

from the that-might-be-useful-right-about-now dept

Ragaboo writes " A congressional report was recently released estimating that the regulation of Internet gambling could amount to around $42 billion in revenue for the U.S. government. Considering both the current financial climate and the fact (given the nature of the Internet) Americans are gambling online anyway, whether the government likes it or not, it seems like an incredible waste not to simply regulate the industry. Regulation provides much-needed funds, allows standards to be imposed and oversight to ensure safety, and also allows safety nets and safeguards to be forced to be put in place against underage and problem gamblers. As it currently stands, millions are playing online poker alone from within the United States (whether or not the government approves of it, which in an of itself isn't explicitly clear) and countless others are gambling, and yet every cent being made in that industry is going overseas."

Indeed. Online gambling seems like one area where a regulated market would make a lot more sense than outright prohibition. Many other countries already do this, and it's really odd that the US continues to resist it. Many claim that it's really just an effort by the existing casinos to block out competition, but it would seem that those casinos would benefit greatly themselves by being able to offer their own online offerings. And, even with this new evidence, it looks like Congress is actually going in the opposite direction.

Filed Under: online gambling

Appeals Court Says Nothing Wrong With Law Banning Online Gambling

from the wanna-bet? dept

Back in 2006, as part of an effort to make our sea ports safer, Congress banned financial institutions from accepting money from online gambling sites, effectively outlawing online gambling (no, I don't understand what that had to do with port safety, but that's just how Congress rolls, apparently). Since then law has been challenged -- but hasn't had much success. The district court tossed it out saying the bill was perfectly Constitutional, and now an appeals court has said the same thing. The groups fighting the law made two claims, neither of which the court agreed with: first, that the law breached users privacy rights to gamble in their own homes, and second that the law was too vague. It seems likely that this will be appealed yet again, but who knows if the Supreme Court will care. In the meantime, every few months there are stories about Rep. Barney Frank promising to legalize online poker... but they never seem to get anywhere.

Filed Under: online gambling

Minnesota Sued Over Online Gambling Ban, While Frank Again Introduces Bill To Legalize It

from the know-when-to-hold-em dept

We noted several days ago that Minnesota was trying to force ISPs to block gambling web sites, going down a path trodden by several other states. That path, of course, has always ended in failure after the courts have weighed in. It looks like the courts will now get their chance to rain on Minnesotan politicians' parade, as a trade group has sued the director of the state's Department of Public Safety's Alcohol and Gambling Enforcement division to stop the ban. The group uses the suit to remind the director that he doesn't have the authority to mandate the blocking by ISPs, something the court will likely reinforce.

Meanwhile, online gambling's biggest friend in Congress, Massachusetts Rep. Barney Frank, has again introduced legislation that would legalize and regulate online gambling in the US. It sounds pretty much the same as his earlier attempts, all of which have failed, and would take the eminently reasonable step of allowing Americans to gamble in a regulated environment where they're protected by rules and law, as opposed to the current situation where they're pushed into the gray market (or worse), and have no protection. Frank also says he'll introduce separate legislation that will stop the enforcement of the UIGEA, which says that banks must stop processing any transactions that fund online gambling. At least one big casino company seems to think Frank's got a good chance of finally getting his law through: Harrah's, which recently hired the former CEO of major online gambling company PartyGaming to head its online efforts ahead of legalization.

Filed Under: barney frank, gambling, minnesota, online gambling
Companies: harrah's, partygaming

PartyGaming Pays Its Online Gambling Tax

from the roundabout dept

Online gambling company PartyGaming has agreed to pay the US government $105 million as part of a "non-prosecution agreement" to wrap up the government's investigation of the site. The move comes after the company's founder, Anurag Dikshit, paid $300 million in online gambling taxes a settlement to the US government last year, meaning it's now collected about $750 million or more in "settlements" with foreign gambling companies and their executives. The government has shown little interest in prosecuting anybody, underlining the belief that it's really just taxing these companies in a very roundabout way. If it's going to do that, it remains that legalizing online gambling so it can be regulated and taxed would be a better solution.

Filed Under: fines, online gambling