BoS Launches New Efforts Backing US Regulation

17 January 2006

BetOnSports (BoS) has initiated a proactive approach toward opening a dialogue for the regulation of online gambling in the United States by enlisting the aid of the International Institute for Conflict Prevention and Resolution (CPR), a well reputed global organization with a broad scope of members that is dedicated to settling legal and policy disputes. BoS has also distributed a white paper explaining why regulation, rather than prohibition, is a better solution to America's I-gaming policy problem.

BetonSports has asked CPR to form an independent advisory council consisting of representatives of all sides of the online gambling regulation issue, including the likes of law enforcement agencies, parenting groups, religious groups and problem gambling groups as well as online gambling operators, regulatory jurisdictions, payment processors and more. The goal of arranging such a council is to deal in the most practical manner with the social, economic and public concerns surrounding regulation of the online gambling industry in the United States.

"In asking CPR to assist in establishing the council, I thought it was important to have an impartial dispute resolution institute facilitate the framework for discussion and identify highly prestigious neutrals to mediate," BetonSports CEO David Carruthers explained. "This reflects the interest of our industry to be responsible and respected contributors to this dialogue."

As "a membership-based, non-profit alliance of global corporations, law firms, scholars and public institutions dedicated to the principles of conflict prevention and solution through alternative dispute resolutions," CPR certainly has the means to unite such a diverse range of individuals on the council. CPR's panel of arbitrators has provided resolutions of thousands of cases worldwide, and approximately 4,000 companies and organizations have signed on to the CPR corporate policy that obligates them to explore the use of alternative dispute resolution solutions in disputes with other signers.

Thomas Stipanovich, president and CEO of CPR, explained, "CPR has often served as an independent and impartial facilitator to discuss and resolve issues of broad public concern. We are enthusiastic about working with Mr. Carruthers and a diverse group of thinkers and leaders to address the many questions and concerns surrounding the advent of Internet-based gambling."

Stipanovich also sits on CPR's board of directors alongside 12 other individuals from prominent corporations, organizations and law firms, most notably Hon. Charles B. Renfrew (Chairman), who has served as a U.S. District Court judge, as vice president of legal affairs for Chevron Corp and as deputy attorney general of the United States, and Hon. William H. Webster, who has served as director of the Central Intelligence Agency, director of the Federal Bureau of Investigation, U.S. Court of Appeals judge and U.S. District Court judge.

Among CPR's 70 executive committee members are John J. Curtin, a former president of the American Bar Association, and Jeffrey M. Senger, current senior cCounsel for the Office of Assoc. Attorney General of the U.S. Department of Justice, as well as high ranking officers of Microsoft Corporation, Georgia-Pacific Corporation, Boeing Company, JPMorgan Chase, the September 11 Victim Compensation Fund, Nestle, BellSouth Corporation, Conoco Phillips, Bristol-Myers Squibb Company, Georgetown Law Center, Citigroup Inc., Prudential Insurance Company of America, Ernst & Young LLP, Boston University, Pfizer Inc., Bechtel Corporation other high-profile institutions.

The first step in the formation of the advisory council will be the appointment of a chairman. Once formed, the council will solicit and welcome the evidence and opinion of any relevant parties that can facilitate the open exchange of a broad range of ideas. The CPR has such robust membership that influencing the necessary policymakers (U.S. government officials) would certainly be attainable. The scope of the council's work, however, is not something that can be completed in the short term; any resolution is not likely to come about for three to six years.

In the meantime, BoS has tried to elevate discussion of the issues in America by releasing a white paper report titled "The Internet Gambling Industry: The Reasons for Regulation in the United States." Last week Carruthers and other BoS officials were in New York to distribute the report and provide a presentation to some of the country's most influential news agencies, including the Wall Street Journal, New York Times, Associated Press, Reuters and Financial Times.

The report contrasts the Department of Justice's efforts to prohibit online gambling against the legal uncertainty and impracticality of enforcing a prohibition, especially at time when online gambling is so popular in America that the country represents 50 percent of the entire global market.

The World Trade Organization dispute between the United States and Antigua and Barbuda is cited as a reason to regulate, and the Antiguan regulatory model is outlined in a manner highlighting its strengths. England's new gambling regulations are also provided as evidence that viable online gambling regulations can become a reality in industrialized nations. The report explains that the new British model came about because the Budd Report and a DCMS report found that "the existing regulatory framework for the gambling industry was no longer relevant to the current technology, and, therefore, was no longer equipped to provide a safe and transparent arena for participants."

Three assumptions typically used by opponents of online gambling to argue for prohibition were also provided and refuted. These include: a) that online gambling sites cannot effectively provide safeguards for minors and problem gamblers; b) that online gambling is financially endangering, with increased risks of bankruptcy and fraud; and c) that online gambling provides a hotbed for money laundering and terrorism.

The report concludes by recommending the creation of an advisory council to explore the regulation of the online gambling industry, which of course, BoS has already taken upon itself to do.

BoS invites other companies in the I-gaming space to join it in lending expertise and experience to the advisory board.

Click here to view BetOnSports' white paper.

Bradley Vallerius

Articles by Bradley P. Vallerius, JD manages For the Bettor Good, a comprehensive resource for information related to Internet gaming policy in the U.S. federal and state governments. For the Bettor Good provides official government documents, jurisdiction updates, policy analysis, and many other helpful research materials. Bradley has been researching and writing about the business and law of internet gaming since 2003. His work has covered all aspects of the industry, including technology, finance, advertising, taxation, poker, betting exchanges, and laws and regulations around the world.

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