Editor's Note: "Insights" is a new biweekly column in which experts in various fields shed light on issues that greatly affect the I-gaming industry. We invite you to send in questions you'd like to see the experts address
A recent letter from the U.S. Department of Justice to the Nevada Gaming Commission essentially stated that adopting regulated Internet gaming would violate the federal Wire Act. In addition to putting quite a damper on Nevada's efforts to legalize online gambling, the opinion has left many online casino operators wondering where they stand. So, we asked the experts:
Does the DOJ letter leverage justice authorities' ability to prosecute casino operators?
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Cory Aronovitz:
"[The DOJ letter] isn't enough for a prosecutor or an attorney general to start going after operators or players on federal charges."
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Cory Aronovitz - I really don't think much is going to come out of this. The ironic thing about the letter is that it totally ignores what was ruled in the U.S. Fifth District court (in reference to the Duval ruling, which established that the Wire Act doesn't apply to casino gaming). The law is pretty clear as far as sports books are concerned, but there still is a lot of gray area when it comes to online casinos.
The letter doesn't answer a lot of the issues that have been raised within this industry through the last couple of years. Not only did the Department of Justice ignore what was said in the Fifth District, it really is only an opinion. This isn't enough for a prosecutor or an attorney general to start going after operators or players on federal charges.
Cory Aronovitz is the managing member of the Casino Law Group. The firm represents various gaming groups, including riverboat casinos, Indian casinos, Internet casinos and casino service industries. He is also a member of the board of directors for the International Masters of Gambling Law.
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Frank Catania:
We have always known that this was the DOJ policy."
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Frank Catania - I don't think we will see much of a change. We have always known that this was the DOJ policy. This was the first time the Administration really came out and publicly said where they stood on the issue, but it was pretty clear from other things they had said, and stands they had taken on issues, where they were on this one. The Nevada Gaming Control Board took the initiative to get a concrete answer from them. They needed to know officially what the DOJ's position was because the Nevada bill was written in such a way that the Gaming Control Board wouldn't license any online casinos until the state knew that they were in compliance with federal laws. No land-based operator in Las Vegas or Nevada is going to open an online casino until they know it is OK with both Nevada regulators and the federal government. The commission asked for the DOJ opinion and they got it. I don't think anything more is going to come out of the letter.
Attorney Frank Catania is a principal in Catania Consulting Group, Inc. of New Jersey, a consulting firm with extensive experience in gaming issues. A former deputy speaker of the New Jersey General Assembly, he actively develops and directs the implementation of lobbying, issues management, media relations, community affairs and government advocacy programs for clients. He is a former director of the New Jersey Division of Gaming Enforcement (DGE), the regulatory and enforcement agency responsible for maintaining integrity and trust in Atlantic City gaming operations.
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