Mohawks Spring Into Action

16 September 1999
The presence of Internet gambling in North America simply will not be denied. After many months of preparation, the Kahnawake Mohawk Nation officially announced its arrival as a licensing jurisdiction for legalized, highly regulated Internet gambling. The tribe proclaimed itself open for business Wednesday at the World Gaming Congress and Expo in Las Vegas, and potential licensees are already climbing over each other to get a closer look at what the autonomous tax haven has to offer.

Located around a half-hour south of Montreal, Quebec, Kahnawake territory will soon play host to a number of wagering website operators looking to facilitate legalized Internet wagering based in North America. All Internet wagering activity will be tightly regulated by the Kahnawake Gaming Commission. The business side of the operations will be handled by Mohawk Internet Technologies, an Internet service provider owned by the Mohawk Council of Kahnawake (MCK).

In July 1999, the Kahnawake Gaming Commission passed regulations for online gambling. Modeled after the Queensland Player Protection Act, the law calls for a very stringent selection process which includes extensive background checks on the businesses and personnel of potential licensees. Unlike the Queensland model, the Mohawks will not impose any taxes.

Player protection is the tribe's No. 1 concern. "If there will be gaming, we have to make sure it is in a controlled environment," Chief Lloyd Phillips explained. "We are not going to rip off the people who are going to use this service. We have to make sure the games are fair." He also pointed out that the MCK won't receive profits from online gambling.

To solidify its regulatory approach, the Commission has brought aboard the expertise of Frank Catania, the former director of New Jersey's Division of Gaming Enforcement and chairman of the International Association of Gaming Regulators.

In terms of protecting players from themselves, there are provisions in the regulations in which players can specify weekly or monthly loss limits. If a player is losing excessively, family members can apply to have him cut off. If the Gaming Commission accepts such a request, it has the power to direct operators not to take bets from that individual. In addition, operators will be encouraged to contribute to a gambling addiction fund.

Licensing will cost the operating company $10,000 (Canadian) per year, plus additional costs involving the licensing process (background checks, etc.). The online gambling license covers all types of gambling.

Other Indian tribes have taken stabs at online gambling, but have been thwarted by U.S. attorneys general who've declared online gambling illegal. Most notable is the Idaho-based Court d'Alene tribe, which closed shop after going head-to-head with Missouri A.G. Jay Nixon (although the tribe hasn't yet given up the fight). It's doubtful that the Mohawks will face similar obstacles. The tribe has maintained communications with the provincial government of Quebec, which has indicated it will not interfere and has even exhibited an interest in working with the tribe toward developing a regulatory framework for an online version of the Quebec lottery.

Murray Marshall, senior in-house counsel for the MCK, emphasized that discussions with Quebec officials have been positive. "We're very interested in harmonizing our systems," Marshall said. "We want to coordinate with what they have (the lottery)."

Even if the disapproval of the provincial government were an issue, the Mohawks have well positioned themselves to hold their own as an autonomous tribe. Since 1979, the tribe has maintained its own police force, courts, education system and hospitals.

With a solid set of regulations in place, a state-of-the art telecommunications facility and a green light from the government of Quebec, the Mohawks are poised to compete as one of the world's top interactive gambling jurisdictions.

Click on the following links for information on the regulations and the application process:

Mark Balestra

Mark Balestra is the Managing Director at BolaVerde Media Group. He previously worked at Clarion Gaming and the River City Group where he was the publisher of iGamingNews. He lives in St. Louis, Missouri.