Important Congressional Hearing on Gambling Scheduled for May 11th

Home » Poker News » Important Congressional Hearing on Gambling Scheduled for May 11th

Tuesday, May 3rd, 2016 | Written by Charles Washington

May 11 could prove to be an important day for the gambling industry, as on that date the ‘Subcommittee on Commerce, Manufacturing and Trade’ of the U.S. House of Representatives will hold a public hearing to gather opinions and information about the potential legalization and regulation of three forms of gambling, namely daily fantasy sports, online gaming, and sports betting.

Who’s Behind the Hearing?

News that a hearing is being held may set off red flags as people might assume the purpose of such a forum would be to make the case against these three forms of gambling, but when you know who’s behind the hearing, it seems way more likely that the purpose is to explore the potential benefits of regulation. The hearing was organized by Representative Frank Pallone, Jr (photo), a Democrat from New Jersey, a state that has long been an advocate for the legalization of gambling. New Jersey is already just one of three states where online gambling is legal, and furthermore for years The Garden State has wanted to legalize sports betting. In addition, New Jersey is currently considering legislation to regulate sports betting.

The Issues at Hand

The choice to hold a hearing on daily fantasy sports betting, sports betting and online gambling makes sense when you consider that all three forms of gambling are currently the subject of scrutiny or controversy. Here’s a look at what’s at stake with each:

– Sports Betting

New Jersey has been caught up in a legal battle to overturn the 1992 PASPA law that makes sports betting illegal in the United States. For a while, it seemed like the law would stand, but New Jersey was given the right to argue their case before a panel of appellate judges in federal court in Philadelphia. If the panel of judges finds in favor of New Jersey, it will open the door for other states to pursue legalized sports betting across the country.

– Online Gambling

The UIGEA legislation from 2006 makes it illegal for payment processors to process payments for online gambling and sports betting. At the request of the Attorney Generals of Illinois and New York, the U.S. Department of Justice reviewed the law in 2011 and concluded that the law did not make online casino gambling and online poker illegal; however, the law did prohibit online sports betting. The decision made room for Delaware, New Jersey and Nevada to regulate online gambling. Since then, a push has been made to reinstate the Wire Act and essentially make it illegal for all forms of online gambling to continue.

– Daily Fantasy Sports Betting

Fantasy sports betting is exempted from UIGEA; however, when this law was passed, the term only referred to friendly leagues made up of friends and coworkers. With daily fantasy sports betting sites now making it possible to bet money on the performance of fantasy teams, there are questions about whether or not the industry should be regulated like online poker in the states where it’s legal. Many lawmakers look at regulation as important for consumers protection, and Congressman Frank Pallone has also questioned that if fans are allowed to gamble on the performance of an individual player, why should they not also be permitted to wager money on a game? As Pallone commented last year:

“These [fantasy sports] sites are enormously popular, arguably central to the fans’ experience, and professional leagues are seeing the enormous profits as a result. Despite how mainstream these sites have become, though, the legal landscape governing these activities remains murky and should be reviewed.”

Challenges Ahead

In the meantime, a number of organizations have lined up against a further expansion of regulated gambling ahead of the May 11th Congressional hearing, including the New Sports Economy Institute (NSEI). The non-profit organization has expressed its view that America could be headed on a irrevocably destructive path if federal legislation was allowed to pass, and the NSEI has already sent out letter to everyone with a stake in the outcome, including Congress, the California Assembly, Attorney Generals, as well as all the major sports organizations such as the NFL, NBA, NHL, and NCAA. As NSEI Managing Director Chris Rabalais, explains:

“Will we sacrifice the integrity of sports, ethics and common sense for the instant gratification of a few dollars? Or will we take the long-term view and follow the better path that not only preserves integrity and encourages ethical behavior, but also maximizes the economic benefit for everyone involved?”