A new online poker bill has been introduced into the Californian State Assembly, with PokerStars and the state´s racetracks still excluded from the action.
Mike Gatto´s introduction of the Internet Poker Consumer Act of 2015 (AB9) came as a bit of a surprise, as it was widely expected that the drive to bring online poker to California would be led by Reggie Jones-Sawyer – who had promised an “example for the entire nation” after his proposed legislation failed to make it past the committee stage earlier this year.
What is also surprising is that the language of Gatto´s proposed bill makes it even harder for
bad actors such as PokerStars to enter the Californian online poker market, and that the state´s racetracks are also excluded – making it likely that the bill would be challenged in court even if it were to be passed.
Backdoor Firmly Shut on PokerStars
Any hopes that the Amaya takeover of PokerStars would offer a backdoor into the Californian online poker market have been firmly extinguished in Gatto´s proposed legislation. In addition to tightening up the language of the
bad actor clause, new language in AB 9 includes the exclusion of any applicant who has
purchased or acquired the assets of an entity formerly engaged in online poker since 2006.
Although a clause further down the proposed bill gives the California Gambling Control Commission the discretion to waive the “bad actor” clause, the existence of language to prevent Amaya entering the market is clearly deliberate and a nod to the “interested parties” who would prefer not to be in competition with the world´s largest online poker site.
Racetracks Will Not be Happy
The exclusion of California´s racetracks will be a major stumbling block for the Internet Poker Consumer Act of 2015. The racetracks and the California Thoroughbred Breeders Association have strong representation in the Senate – where a bill has yet to be introduced – and have indicated in the past that they will mount a legal challenge to any online poker legislation from which they are excluded.
It is almost a certainty that the racetracks will have to be included in Gatto´s bill if it is to have any chance of success. The bill will need a two-thirds majority in the State Assembly and the Senate to pass into law, and the inclusion of the racetracks will be more than likely recommended during the committee stage, which is the next step for AB 9.
Measures to Tackle Underage Terrorists
The proposals for Californian online poker also include measures to allay fears of underage gambling and criminal activity. In Gatto´s bill, he suggests that players must visit a brick-and-mortar casino or other “satellite service center” in order to register an online account. This – according to Gatto – would eliminate concerns about underage gambling as online poker players would have to present age verification documents in person.
A separate clause proposes that players who are making frequent withdrawals must collect their money from a casino or service center. This proposal aims to discourage the use of online poker websites by organized criminals to launder money as well as providing a secondary age verification process. What the casinos and service centers are meant to do if they suspect an international terrorist is withdrawing large sums of money is not explained.
Legislation Unlikely to Stop Unregulated Sites
The proposed legislation also aims to clear up the area of whether online poker is legal in California. The current situation is that playing online poker in California is okay, although the operator of the game should have a license if he (or she) is based in California. US-friendly poker sites operating outside of California are currently free to provide a service to the state´s estimated 2 million online poker players without fear of prosecution or penalty.
The Internet Poker Consumer Act of 2015 aims to change this by sanctioning only those sites that fulfill its licensing criteria and making the provision of an online poker service by a non-sanctioned site a misdemeanor. As the penalty for a misdemeanor in California is a $1,000 fine or a modest amount of time in jail, it is unlikely that this will deter many US-friendly poker sites from continuing to provide a service.
The full text of the proposed Internet Poker Consumer Act of 2015 can be found here