House Subcommittee Analysis; Federal Poker Bill Gains Momentum

John Mehaffey December 10, 2013 1472 Reads

The House Energy and Commerce subcommittee held a hearing today to discuss HB 2666, also known as the Poker Freedom Act.  The bill is sponsored by Rep. Joe Barton (R-TX).  It would regulate online poker, but not house games or sports betting.

The meeting started with a bit of a gaffe when Rep. Barton stated “God is for this bill” after describing how he was able to make the meeting despite inclement weather.  That was quickly forgotten after Rep. Terry (R-NE) cracked a joke when he asked Barton if a state could approve Omaha and not Texas Hold’em, alluding to their home states.

American Gaming Association and Poker Players Alliance Deserve Credit

Geoff Freeman (American Gaming Association) and John Pappas (Poker Players Alliance) both presented credible arguments for the regulation of online poker.  Both were eloquent and answered all questions truthfully and backed opinions up with facts.  These two men deserve a thank you from the online poker community today and credit should this bill progress.  Without their performance today, this meeting could have been a flop.  Instead, it may be the most positive moment for online poker at a federal level ever.

Opponents Speak

There were two witnesses that are clearly opposed to online gaming; Les Bernal of Stop Predatory Gambling and Andy Abboud of Las Vegas Sands.  Bernal is opposed to any gambling expansion, while Abboud only spoke out against Internet gaming, as his company is a brick and mortar casino operator.  That is where it got interesting.

Las Vegas Sands Declared Hypocritical

Abboud’s boss is Sheldon Adelson, CEO of Las Vegas Sands and a staunch opponent of online gaming in any form.  This position was declared hypocritical by two committee members.  Rep. Jan Schakowsky (D-IL) was the first to bring up this point, but she did not give Abboud a chance to respond.  Rep. Barton later showed screenshots of the Venetian’s website and gave Abboud the floor.  This was Abboud’s full response:

It is also about the location.  That is a very controlled environment, in a regulated state, in a regulated casino, that can only be done within the four walls of our building.  You have to go up…to the cage, fill out the application, have an eyeball to eyeball experience. Make sure you aren’t on the self exclusion list, make sure we don’t think you have had too much to drink…

Rep. Barton had enough at that point and interrupted:

To filibuster the last 30 seconds…..What your company is advertising here, except for the geography, is the same thing my bill does.    

Rep. Barton may not have known it at the time, but Abboud’s statement “that can only be done within the four walls of our building” was not entirely truthful.

Players must make a deposit at one of their sports books, which include Venetian and Palazzo, but do not have to remain on the property to make a wager.  Sports wagers are accepted by Cantor Gaming from players anywhere in Nevada using their app.

Cantor Gaming is a tenant of the properties owned by Las Vegas Sands.

Earlier in the hearing, Abboud commented that he feels offshore sites could still  successfully operate in competition with regulated sites because the regulatory requirements to prevent underage gambling:

[A]re a barrier to market, by the time someone has to go through all of that … if you don’t shut down the illegal sites that is where they will end up.

He then describes the online poker  legalization process in Nevada as trying to “scare Congress into acting” and that it was “probably the worst bluff in the history of poker”.  I doubt Nevada lawmakers or Governor Sandoval agree with that sentiment, especially considering that it was passed unanimously, a point Abboud brings up in his statement.

From my point of view, I had a hard time believing that Abboud believed his own sales pitch.  Being called out by two committee members for being a hypocrite probably did not help his credibility among the representatives presents, although he was involved in the Q&A process more than the other opponent, who clearly is against all forms of gambling and had little to add to a regulatory discussion.

What is Sheldon Adelson Thinking Right Now?

I would be surprised if Sheldon Adelson was at all impressed with how today turned out.  His company got called out as hypocritical by two committee members and some of the points Abboud made are exactly why regulation is needed, a point Rep. Barton was quick to make.  This hearing, combined with last week’s op-ed that missed the mark, might slow down the movement.  It is now easier for online gaming proponents to discredit his efforts.

(Updated to remove duplicate sentence)

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