U.S. Congresses Passes I-gaming Prohibition

[Frank]

Michael, in regards to this text on the casinocity site..

http://www.casinocitytimes.com/news/...ntentID=161472

"If the affiliate is paid for those referrals by receiving a share of the money wagered or lost, it would not be difficult to charge the affiliate with violating this law, under the theory of aiding and abetting. Being a knowing accomplice and sharing in the proceeds of a crime make the aider and abettor guilty of the crime itself. The federal government could also charge the affiliate with conspiracy to violate this new Act."

Consider the affiliates only promote online casinos or online poker rooms that are NOT accepting bets from American citizens. Would the affiliate still be considered aiding and abetting?

My thought is no, since the online casino or poker room is complying with the US law.

Thank you,

Mark
Focalclick.com

[topboss]

For what its worth, I am sending the above to as many news media folks and whoever will listen. If I wind up behind bars, your taxes can feed me, clothe me, and pay the electric bill. (No, I will not drop the soap in the showers

Go for it Ziggy. Thats a well written article. Well Done

[MichaelCorfman]

Michael, in regards to this text on the casinocity site..

http://www.casinocitytimes.com/news/...ntentID=161472

"If the affiliate is paid for those referrals by receiving a share of the money wagered or lost, it would not be difficult to charge the affiliate with violating this law, under the theory of aiding and abetting. Being a knowing accomplice and sharing in the proceeds of a crime make the aider and abettor guilty of the crime itself. The federal government could also charge the affiliate with conspiracy to violate this new Act."

Consider the affiliates only promote online casinos or online poker rooms that are NOT accepting bets from American citizens. Would the affiliate still be considered aiding and abetting?

My thought is no, since the online casino or poker room is complying with the US law.

Thank you,

Mark
Focalclick.com

No, an affiliate could not be considered aiding and abetting illegal gambling in the US if the affiliate promotes gaming at sites that do not accept players domociled in the US. In the case of Casino City, we only accept payment on a CPA basis, which further diminishes the risk that we could be found to be aiding and abetting. Such a charge requires that you be actively engaged in the business in a way that our attorneys advise us is not the case for Casino City. In fact, the U.S. Department of Justice moved to have our case dismissed with one of the significant reasons cited being that we did not meet the criteria for being charged with aiding and abetting.

Michael

[Pablo]

What would be the case if the affiliate puts a disclaimer alongside with every gambling link on his or her site stating something like "not valid for U.S. residents"? Would that be enough to grant protection against the "aiding and abetting" argument in any way?

[MichaelCorfman]

Thank you guys. You gave a lot of information. I have already studied all this docs. But I want to elaborate several things:
1. Is it necessary to change hosting to another one located outside USA?

At this point in time I do not believe there is any such necessity. Locating outside the US means that there is no authority for requesting that online gambling site links be removed from your site, but that doesn't matter unless such a request is made. I doubt that the focus of any link removal efforts would be with smaller portal sites, but rather with major sites and search engines where it would make a difference. However, all other things being equal, it makes sense to locate sites outside of the US if the move is not any trouble, and the cost does not matter. In the case of casino city, our costs would be greater for a move, and it would be a lot of trouble, so I don't see it as being worthwhile.

2. Will USA citizens be able to play online casino? (I see that 888.com, William Hill and other large companies are going to suspend accepting USA players)

Some online gaming sites we decide to discontinue accepting US players. This will be particularly true where the premium the financial marketplace puts on being completely legal is greater than the financial loss from US player income. A good example of where I believe this principal applies is cryptologic.

3. If I change my hosting located outside USA will USA players be able to go online casino from my site?

Probably, but there are no guarantees. If the IP addresses of online casinos are blocked within the US, then following a link from a site located in the US to the online casino or from a site located outside the US to the online casino would both be broken. I do think there are real challenges to blocking the IP addresses of online casinos, so I don't believe that is likely to actually happen,
however, there are others who think the risks are larger here.

Michael

[xecutech]

After seeing this in the news and then reading through this thread on the subject, I am totally disgusted, again, with our government!
I am sick and tired of living in a country, that claims to be free, that I can't make choices of my own.
They want to ban online gambling, but I stand in line to pay for gas and have to wait behind 5-6 people buying lottery tickets all the time.
I understand them thinking they are protecting us by banning online gambling, because of people with gambling addictions and etc., but not everyone who gambles has an addiction!
It's a percentage that do have a problem, but I shouldn't be banned from it because of them and there poor choices. Again, I know people who spend their paychecks on the lottery and scratch offs, but the lottery is government run, so it makes it ok!
I know that people who are allergic to peanuts can die if they eat them, but we don't have a ban on peanuts!
I am just aggrevated by this whole thing... just venting....

[aksana]

After seeing this in the news and then reading through this thread on the subject, I am totally disgusted, again, with our government!
I am sick and tired of living in a country, that claims to be free, that I can't make choices of my own.
They want to ban online gambling, but I stand in line to pay for gas and have to wait behind 5-6 people buying lottery tickets all the time.
I understand them thinking they are protecting us by banning online gambling, because of people with gambling addictions and etc., but not everyone who gambles has an addiction!
It's a percentage that do have a problem, but I shouldn't be banned from it because of them and there poor choices. Again, I know people who spend their paychecks on the lottery and scratch offs, but the lottery is government run, so it makes it ok!
I know that people who are allergic to peanuts can die if they eat them, but we don't have a ban on peanuts!
I am just aggrevated by this whole thing... just venting....

Yes, I agree. And I'm so happy that I'm not a resident of USA. Americans have no freedom of the choice But a plenty of people, soldiers, fighting for the freedom, for the democracy died in Irak. And I must say that Bush is the worst president in the world... And It's a pity, because USA is a great country.

[Ziggy]

The American Gaming Association, which lobbies for the U.S. casino industry, took a neutral stance on the bill, even though several prominent members, such as MGM Mirage, have said they would like to start online sites. AGA president and CEO Frank Fahrenkopf says the organization does not believe the act eliminates the possibility for U.S.-based casinos to open online sites, regulated by states or the federal government, in the future

Indeed, Nevada Congressman Jon Porter introduced a bill in May that would study whether online gambling sites, run by U.S. companies, could be effectively regulated. Fahrenkopf believes that bill is likely to be considered early next year.

http://www.msnbc.msn.com/id/15118962/

So what this is all about, then, is running online gambling companies by U.S. land-based casinos only - anyone surprised???

[dhayman]

No, an affiliate could not be considered aiding and abetting illegal gambling in the US if the affiliate promotes gaming at sites that do not accept players domociled in the US. In the case of Casino City, we only accept payment on a CPA basis, which further diminishes the risk that we could be found to be aiding and abetting. Such a charge requires that you be actively engaged in the business in a way that our attorneys advise us is not the case for Casino City. In fact, the U.S. Department of Justice moved to have our case dismissed with one of the significant reasons cited being that we did not meet the criteria for being charged with aiding and abetting.

Michael

Michael,

In your estimation, why does receiving money on a CPA basis diminish risk at all ?? Aren't you still receiving money which is, in the government's words, "aiding and abetting gambling" ????

Thanks in advance for your input.

[WebMeisterQ]

I'd like a reply to that ? as well...its food for thought for sure...

[Frank]

No, an affiliate could not be considered aiding and abetting illegal gambling in the US if the affiliate promotes gaming at sites that do not accept players domociled in the US. In the case of Casino City, we only accept payment on a CPA basis, which further diminishes the risk that we could be found to be aiding and abetting. Such a charge requires that you be actively engaged in the business in a way that our attorneys advise us is not the case for Casino City.
Michael

So, if the affiliate promotes sites that do take US customers, they could be considered aiding and abetting?

Such a charge requires that you be actively engaged in the business in a way that our attorneys advise us is not the case for Casino City.
Michael

What does actively engaged in the business entail? What if you provided programming or graphic design services for the casino that accepted US players? Would this be considered aiding and abetting?

Thank you Michael.

[MichaelCorfman]

Michael,

In your estimation, why does receiving money on a CPA basis diminish risk at all ?? Aren't you still receiving money which is, in the government's words, "aiding and abetting gambling" ????

Thanks in advance for your input.

My understanding is that to be guilty of the criminal conduct considered aiding and abetting a level of participation that goes beyond simple advertising must exist. There is a range of involvement and direct benefit that is lowest for a fixed advertising or CPM arrangement, a little greater for PPC, a little greater for CPA, and by far the greatest for revenue share arrangements. In the latter case ones financial benefit is directly correlated with the financial benefit of the gambling site. This makes it easier to claim that you are involved with the gambling enterprise as a equal partner in its success. So the question is when is the shade of grey you are dealing with dark enough to be convincingly painted as black when a court needs to make the black and white decision about whether an activity is aiding and abetting. The darker the shade, the greater the risk.

Michael

[MichaelCorfman]

So, if the affiliate promotes sites that do take US customers, they could be considered aiding and abetting?

You will get different answers from different attorneys about the risks here. The department of justice has said advertising could be aiding and abetting and has advised consultation with attorneys. However, there is no case law consistent with that viewpoint. In the response to our First Amendment case, the DOJ stated that mere advertising did not meet the criteria for aiding and abetting.

What does actively engaged in the business entail? What if you provided programming or graphic design services for the casino that accepted US players? Would this be considered aiding and abetting?

Thank you Michael

Well, if you were a subcontractor to a drug cartel who was hired to guard a truck going across the border when you knew the truck was bringing heroin into the country, that would be aiding and abetting the commission of a felony. If you didn't know the truck was carrying drugs for a cartel, and were just guarding the contents, that would not be criminal.

In the example you give, I think it depends on the nature of the involvement, and it depends on the nature of the site. If it is a poker site operating under the jurisdiction of another government, then there is actually no federal law right now (even after passage of the new statute) that says operating such a site is illegal unless the site offers sports betting services.

Michael

[kidd75219]

As far as aiding and abetting, I don't think there is much difference between CPA and revenue share. How can the government find out which one you are on? The casinos sure are not going to tell them.

[pendil]

not sure if anybody has raised this,but what happens when this situation is resolved( i can't believe the American people will be dictated to how and where they can spend their money for too long.)

when those players return to the same casinos and poker rooms will they still be the affiliates players ?

i am getting emails every day saying American players accounts are being closed.However rest assured they will still have their contact details,and will be offering them no hassle reopening of accounts when the time comes.

will they still be affiliate accounts or brand new accounts with no payments to affiliates ?

have asked a few affiliate managers,but got no replies

anybody know ?

pendil

www.best10gamingsites.co.uk/
www.easyplaygames.co.uk/
www.sculpturebooks.co.uk/

[MichaelCorfman]

As far as aiding and abetting, I don't think there is much difference between CPA and revenue share. How can the government find out which one you are on? The casinos sure are not going to tell them.

You have to understand that in the case of Casino City, we filed a suit against the DOJ to establish its right to advertise online gambling sites. We had to assume that all of our contracts would be required to be produced during the course of our case against the DOJ. Our attorneys believed that a CPA versus a revenue share arrangement was different enough in nature that we were relatively protected in the CPA case, and vulnerable in the revenue share case. In fact, they would not have agreed to represent us if we operated on a revenue share basis because they felt there was too great a risk the case could backfire on us if that was our basis of operation.

Similarly, if a case was brought against an affiliate, the first thing that would happen would be a demand to produce documents showing the details of all relevant business relationships.

Michael

[MichaelCorfman]

not sure if anybody has raised this,but what happens when this situation is resolved( i can't believe the American people will be dictated to how and where they can spend their money for too long.)

when those players return to the same casinos and poker rooms will they still be the affiliates players ?

i am getting emails every day saying American players accounts are being closed.However rest assured they will still have their contact details,and will be offering them no hassle reopening of accounts when the time comes.

will they still be affiliate accounts or brand new accounts with no payments to affiliates ?

have asked a few affiliate managers,but got no replies

anybody know ?

pendil

I think the affiliate managers are all completely overwhelmed at the moment, and in order to answer your question, they would need to get an answer from their management, which is probably also completely overwhelmed. Their entire focus has to be on dealing with what is necessary to keep their business alive over the near term. In my opinion, if they focused on things that were not related to operations over the next month or two, they would be unlikely to even be around to worry about the answer to the question you pose should it become relevant.

Personally, I do think the question you pose matters a great deal for any site that resumes taking US players. However, I strongly suspect that companies that cease accepting US players today will not change their mind tomorrow, so I expect the question will be moot in nearly every case. If they were unsure, I would expect them to defer a decision rather than to announce they were not going to continue to allow US players.

And similarly, from a business perspective, I think you need to assume that all of your revenue share income associated with US players at sites that will discontinue accepting them is history. Sorry to be so blunt, but that is the situation as I see it.

Michael

[fleaflickerdeb]

As of next Friday US president George Bush is expected to sign the Port Security Bill........



http://www.eog.com/news/industry.aspx?id=10142

[WebMeisterQ]

WE knew he was going to sign it...I mean come on, this is George W. Bush we're talking about people...you know...the guy who reads "MY Pet Goat".

[Anthony]

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