By TONY BATT
lasvegas.com Gaming Wire
WASHINGTON -- A frequent argument voiced by Internet gambling opponents is that online betting is impossible to regulate. Officials on the Caribbean island of Antigua, a haven of offshore gambling on the Worldwide Web, beg to differ.
By the end of this year, Antigua’s parliament hopes to approve new regulations for about 100 licensed Internet gambling operators.
The industry produced about $24 million in revenues last year for Antigua, an independent island state located about 1,000 miles southeast of Miami with a population of about 65,000.
A 3 percent tax on gross revenues for Internet gambling operators also is being considered by the Antiguan parliament.
Gary Collins, an attorney and chairman of Antigua’s commission on betting and gambling, said the island has regulated Internet gambling since 1997.
"Our regulations are no longer current because things move so fast on the Internet,” Collins said. “We need to bring them up to speed so we are on the cutting edge when it comes to preventing money laundering."
The two men hired last December to develop the new regulatory scheme were Frank Catania, a consultant who served as gambling enforcement chief in the New Jersey attorney general’s office from 1994 to 1999 and Joseph Kelly, a business law professor at Buffalo State College in New York.
Catania and Kelly devised a regulatory scheme that broadens Antigua’s monitoring authority of Internet gambling operators and demands more personal disclosures from applicants seeking licenses.
But money laundering was the primary focus. Catania and Kelly crafted a standard requiring Internet gambling operators to be more diligent in reporting suspicious financial transactions.
"Antigua has had some money laundering problems with Russian banks," Collins said. "We want the best possible regulatory environment so we can attract the best Internet gambling operators and customers."
Catania said he and Kelly proposed basically the same regulations for Antigua that are used for land-based casinos.
The difference, Catania said, is that it is easier to track gambling transactions on the Internet. "I think the regulation for Internet gambling is better than for brick and mortar casinos because the software provides more information on a player," Catania said. "I can tell you what the bets were and everything."
Internet gambling opponents disagree. Bernie Horn, a former lobbyist for the National Coalition Against Legalized Gambling who now works for the Center for Policy Alternatives, noted Internet gambling sites have increased from 30 to 1,400 in just five years.
"It is impossible to know who owns the establishment and physically impossible to check the computer software," Horn said. "The stringent regulation of casinos in Nevada cannot be matched in Internet gambling."
Collins acknowledged there are "cowboy" operators running unlicensed Internet gambling sites. But as regulations improve, he said, Internet gamblers will want to wager their money on reputable sites that are licensed.
Annual license fees for Internet gambling sites in Antigua are $100,000. For Internet sports books, the yearly fee is lower at $75,000 because this sector provides more of the industry’s 700 jobs in Antigua.
Collins said there is no reason why the Internet cannot be regulated in the United States.
"Look at it this way. The United States is the most technologically advanced country in the world, so it should be the country best equipped to regulate Internet gambling," he said.
Congress does not seem eager to either ban or regulate Internet gambling. Sen. Jon Kyl, R-Ariz., and Rep. Bob Goodlatte, R-Va., have vowed to re-introduce measures this year to prohibit Internet gambling, but neither has said when.
Meanwhile, the land-based casino industry, which originally viewed Internet gambling as a competitive threat, is growing more eager to enter the market.
This month, the Nevada Assembly Judiciary Committee passed legislation that would authorize the Nevada Gaming Commission to adopt its own set of Internet gambling regulations. "That's quite a change from what we were seeing just a few years ago," Kelly said.