Live Reporting U.S. House Committee Hearing On RAWA, Online Gambling

December 9, 2015
Live Reporting U.S. House Committee Hearing On RAWA, Online Gambling

US Poker will post continuous updates of the hearing taking place in front of the House Committee on Oversight and Government Reform where the topic of discussion will be online gambling, with a focus on law enforcement implications.

The hearing, with the dubious title of A CASINO IN EVERY SMARTPHONE – LAW ENFORCEMENT IMPLICATIONS. is scheduled to begin at 1 PM EST, and will be chaired by Jason Chaffetz (R-UT), the sponsor of the Restoration of America’s Wire Act (RAWA) bill in the House of Representatives.

The witness list for the hearing can be found here.

1 PM

Hearing is being delayed due to floor votes in the House.

1:25 PM

According to John Pappas of the PPA, Chaffetz has just arrived, and members are finding their seats.

Hearing is now underway.

1:30 PM

Chaffetz is offering up a quick summary (from his vantage point) of the Wire Act and the 2011 decision by the Office of Legal Cousel to limit the Wire Act to sportsbetting.

Chaffetz says the reversal has caused “confusion.” Unfortunately, the reversal clarified the Wire Act and how it applies to online gambling.

Chaffetz doesn’t want gaming to come to Utah. He wants state to have that right – which is strange that he’s advocating for a federal ban that takes away the state’s right to choose.

Chaffetz foolishly citing FBI letter, when FBI spokesperson will soon testify and set the record straight.

Chaffetz argues in opening remarks that the entire opinion by OLC is based on a single comma.

1:35 PM

Elijah Cummings wants to “know what is going on here” as they’re hearing from both sides with everything they’ve got.

“Let’s not kid ourselves, this is a lot about money,” Cummings notes. “Whatever we do we want to be fair.”

Cummings has yielded most of his time to Rep. Watson Coleman from New Jersey.

Watson Coleman voted for online gambling as member of New Jersey legislature, and is refuting Chaffetz’s remarks. “Legal states have not seen an increase in law enforcement challenges.”

Watson Coleman showing slides of geolocation technology; clear refutation of Chaffetz’s claims that the Internet can not be closed off.

1:40 PM

Chaffetz introducing witnesses – The witness list for the hearing can be found here.

1:45 PM

FBI rep Campbell offering testimony.

Campbell is essentailly reading from old FBI letters on potential for money laundering at illegal online gambling sites.

1:50 PM

South Carolina AG Wilson is up; he’s a strong supporter of RAWA and feels the 2011 OLC opinion should have been decided legislatively.

Wilson wrongly states that the Wire Act reversal legalized online gambling.

Hearing officially off the rails as Wilson talks about mothers leaving children in cars to die while they played video poker.

Wilson says state cannot protect citizens from online gambling, even in states where it’s already available (from offshore illegal operators).

1:55 PM

Attorney Douglas Kleine testifying. Says online gambling puts undue burden on law enforcement.

I don’t know why Kleine wants to prosecute LEGAL online gambling sites?

Kleine, a non-expert on this topic, is spending a lot of time talking about problem gambling issues.

2 PM

Former NGCB Chair Mark Lipparelli now speaking about enacting regulations for Nevada’s legal online poker industry.

Lipparelli notes the committee could turn to experts with hands on knowledge. “We are no longer in the Greenfield” we have concrete knowledge that can replace speculation – like the things previous witness have stated.

Lipparelli compares ongoing process of regulation of iGaming to traditional casino regulation. You live, you learn, and you adjust.

Lipparelli is ignoring previous (outlandish) witness testimony and focusing on facts, intimating their fearmongering is not even worth considering to committee. This is similar to state level hearings, the crackpots get their 5 minutes and are then ignored – hopefully the case here.

Lipparelli says he was concerned early on, but time with experts gave him confidence in regulated market.

2:10 PM

Questions begin.

Chaffetz introduces letter from 2014 from 16 State AGs instead of the 2015 letter that has 8 signatures.

Kentucky Rep. Massie asking FBI how prevelant criminal activity in online gambling is. Campbell notes one case, but gives hypothetical. Massie notes, “you’re not aware of ANY cases involving terrorism and online gambling?” and asks why states can’t just pass laws to handle online gambling. Lipparelli notes state law already prevails.

Massie has serious 10th Amendment misgivings about federal online gambling ban.

Rep. Watson Coleman asks FBI if they’ve had any issues with regulated online gambling sites.

FBI’s Campbell likes hypotheticals, and is trying to avoid saying that there is no evidence of online gambling being a law enforcement problem.

Watson Coleman doing a good job of separating regulated from unregulated online gambling. Now asking Lipparelli what is in place at regulated online gambling sites to help CATCH money laundering.

Lipparelli notes everything in regulated markets is completely transparent and his opinion “If you were going to try to launder money a legal regulated site is the last place you would want to do that.”

We may have found our new iGaming champion in Congress, Representative Bonnie Watson Coleman.

Representative Mulvaney having trouble squaring the RAWA circle of making something states want illegal, illegal… yet it would make things state’s (NJ, Nevada, and Delaware) want legal, illegal?

So far, no member of committee other than Chaffetz is buying the RAWA argument.

Cummings comes off the top rope and asks “If we outlaw online gambling will B&M casinos make more money?” Nobody refutes, and Cummings basically says this is about money, and seems to be coyly speaking about RAWA supporter Sheldon Adelson.

Lipparelli, illegal site are readily available, and it’s not going to change. Once again tries to create space between regulated and unregulated online gambling. Cummings makes same point, and FBI’s Campbell stumbles over his answer – Cummings cuts him off and throws question to Lipparelli.

RAWA hearing going same as state hearings, lawmakers start to realize some witnesses are not serious and ignore or challenge them

Lipparelli notes that the original interpretation of the Wire Act as it applies to online gambling was also a DOJ opinion, and not a law.

Georgia Rep. Hice (whose state has legal iLottery), like Cummings, is not suffering fools lightly, and cutting off non-answers: “that’s not my question,” and moving down the line until he gets someone to answer his question about state’s rights.

2:40 PM

Hearing in recess.

3:15 PM

Several representatives give their opinions on RAWA and ask questions:

  • Rep. Lynch (Mass.) says that RAWA would simply push online gambling offshore, rather than bringing it into line with the law.
  • Rep. Titus (Nevada) questions witnesses, including the FBI’s Campbell, who has no examples of online gambling being used for criminal activity. She also questioned the idea that RAWA is somehow a bill that strengthen states’ rights, calling it “jabberwocky.” Lipparelli goes on to describe how Nevada iGaming sites block players from other states.
  • Rep. Walker says he’s “conflicted” about RAWA because of the Tenth Amendment.
  • Rep. Lieu ridicules the idea that you can’t locate someone accurately for online gambling. points to GPS in phones, says testimony of witnesses (other than Lipparelli) is wrong. A video from GeoComply is shown.
  • Rep. Grothman, a RAWA co-sponsor, asks about the “evils of gambling” and if there is more online gambling because of increased access.
  • Rep. Chaffetz, refuting the idea that online gambling has not been used in criminal cases, enters a Washington Post story into the record.
  • Rep. Palmer brings up access of online gaming to minors, and the potential harm it can do.

4:10 PM

Chaffetz wraps up the hearing, trying to put forth his views, and questioning Lipparelli on the efficacy of state regulation.

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