Analysis of new gaming law and affiliate options - Page 2

scrawnybob · #11 10-06-2006, 04:26 AM

hi jacks n queens

read you post with great interest as it's certainly a different view (which I accept you've had legal advice on) but seems to go against alot of other legal advice too

what you seem to be suggesting is

a) US players are not breaking US law PLAYING poker online (which everyone seems to agree is still the same legal grey area is was before)

and the POKER SITES will be breaking new law by accepting money transactions through the banks (under new US law) - which again everyone agrees this is what the bill is saying

but this still leaves Neteller which could be a perfectly legal & offshore poker sites (most of them) many of whom mantain because they are offshore do not have to comply or would not be breaking the law

b) But you say that POKER SITES promoting to US players and openly declaring so are setting themsleves up for prosecution

and by association affiliate sites who promote these sites position are also
setting themselves up for problems

Now I could see the logic in this for US affiliates promoting a US based Poker Site - are they're any ??

But most Poker sites are offshore and those sites who have openly said they are operating within international law and are NOT subject to this US legislation (see cardplayer legal piece which agrees with this) feel they DO NOT have to answer to US govt.

Therefore how can an affiliate who is posting / reporting and by default effectively promoting these sites to US players be in danger (if they are also off shore)

What you seem to be suggesting is that somehow an affiliate ANYWHERE is breaking US law by promoting a poker site (offshore) who is taking US players but by Neteller etc.

And if I report the statement on xyz site (who says they are open to US players) and also have aff links to them
I am somehow going to get arrested by the feds if I ever come on holiday to the states

I genuinely cant see this can be true or legally correct - in the example of poker.com (stating open to US players)

a) I have posted on forum / news etc they are one of the sites that have THEMSELVES stated are open to US players

b) I have been promoting them to players for where ever in the world before the bill

This I can't see suddenly puts me at grave risk of US arrest problems etc

To me IMHO reporting a statement by a poker a site and also promoting a site saying THEY have stated they're open to US players doesn't suddenly make me a criminal

While your postion at first made sense and was utterly depressing (ie. It effectively ruled out the entire US market and all sites to everyone affiliating anywhere)

plus your implying that by promoting sites who say they will take US players EVEN promoting to them in other countries is also not a good idea because they have marked their card and are vunerable

IMHO this would seem like the perfect response from the companies who have withdrawn from the US and are now desperate to get into the rest of world market but are sore that a good many offshore non quoted poker sites have decided they actually dont have to answer to this law (maybe rightly or wrongly)

It doesn't seem to be consistent with any of the other legal advice going around - ie. cardplayer etc

The bill is about payments to poker sites - not US players playing poker & more importantly to affiliates - many offshore sites do NOT consider themselves to be out of US market under the new law

How if these sites have publicly stated they are not breaking the law are poker affiliates supposed to be somehow implicated by association - if we are only reporting on statements by these sites ?

EG. if poker.com states (which it has) publicly that it does not consider itself to be breaking a US law because it does not have to recognise it (it's not US company and is operating under international law)

how am I as an affiliate (non US) breaking a US law (again I'm non US) if I promote by reporting / stating that poker.com has said it accepts US players ??????

What you seem to be saying is that offshore companies & affiliates have to obey a US law on transactions (which is not the same as a ban) when they are not US companies - if its no illegal for US poker players to play - how can I be held responsible ?

cheers scrawnybob

PokerProp · #12 10-06-2006, 06:31 AM

This is a great post, thanks for the info JacksNQueens

Quite a few people are saying this law does make online poker illegal. In my opinion it does. It clearly makes state laws a federal crime. Say in state XYZ it is a misdemeanor well with this new bill it has also become a federal felony. I’m no expert but this is what it sure looked like when I read it.

While targeting affiliates is highly unlikely yes a foreign resident is just as much risk as a US resident. If affiliates are being prosecuted then a resident of Canada could be very easily extradited for prosecution in the US if promoting “unlawful” gambling is also illegal in Canada.

If it is legal in the UK then affiliates in the UK have less to worry about as long as they do not a) break another law that is illegal in both the UK and US, b) travel to any country where gambling is illegal (and this could be a permanent decision!).

Again its very unlikely that affiliates are targeted but heck what do I know, I was told it was unlikely this bill would pass.

PokerProp · #13 10-06-2006, 06:50 AM

The issue of affiliates from within the US being at risk has been discussed many places and most legal opinions I've seen are summarized as: "Yes, An affiliate would be committing a crime but it’s unlikely that they are targeted for prosecution".

Calvin Ayres (owner of Bodog) has been in Vegas many times and actually had a trip planned there right before the David Carruthers of BetonSports was arrested. I am sure these are not the only gaming execs to travel to the US. It unlikely never crossed David Carruthers mind he would be arrested while traveling that day, he was the first and it came as a shock to a lot of people. All of a sudden at this point people started needing to take the advice given to them in the late 90's which was (You can never enter US soil).

I’ll save it for another conversation but personally I’ve always wondered how Calvin Ayre has been such high profile and has done many events in NYC and Vegas and had not been picked up before. Plus even worst he is in Canada and he does not allow Canadian accounts (perhaps that helps him avoid being extradited?? Even so he was traveling to the US often enough they could of grabbed him anytime if they wanted to.

Anyways, it is an extremely thin chance that anything happens to a UK affiliate while visiting the US, but yes it is a risk (no matter how slim the risk is it does exist).

Quote:

Originally Posted by scrawnybob

hi jacks n queens

read you post with great interest as it's certainly a different view (which I accept you've had legal advice on) but seems to go against alot of other legal advice too

what you seem to be suggesting is

a) US players are not breaking US law PLAYING poker online (which everyone seems to agree is still the same legal grey area is was before)

and the POKER SITES will be breaking new law by accepting money transactions through the banks (under new US law) - which again everyone agrees this is what the bill is saying

but this still leaves Neteller which could be a perfectly legal & offshore poker sites (most of them) many of whom mantain because they are offshore do not have to comply or would not be breaking the law

b) But you say that POKER SITES promoting to US players and openly declaring so are setting themsleves up for prosecution

and by association affiliate sites who promote these sites position are also
setting themselves up for problems

Now I could see the logic in this for US affiliates promoting a US based Poker Site - are they're any ??

But most Poker sites are offshore and those sites who have openly said they are operating within international law and are NOT subject to this US legislation (see cardplayer legal piece which agrees with this) feel they DO NOT have to answer to US govt.

Therefore how can an affiliate who is posting / reporting and by default effectively promoting these sites to US players be in danger (if they are also off shore)

What you seem to be suggesting is that somehow an affiliate ANYWHERE is breaking US law by promoting a poker site (offshore) who is taking US players but by Neteller etc.

And if I report the statement on xyz site (who says they are open to US players) and also have aff links to them
I am somehow going to get arrested by the feds if I ever come on holiday to the states

I genuinely cant see this can be true or legally correct - in the example of poker.com (stating open to US players)

a) I have posted on forum / news etc they are one of the sites that have THEMSELVES stated are open to US players

b) I have been promoting them to players for where ever in the world before the bill

This I can't see suddenly puts me at grave risk of US arrest problems etc

To me IMHO reporting a statement by a poker a site and also promoting a site saying THEY have stated they're open to US players doesn't suddenly make me a criminal

While your postion at first made sense and was utterly depressing (ie. It effectively ruled out the entire US market and all sites to everyone affiliating anywhere)

plus your implying that by promoting sites who say they will take US players EVEN promoting to them in other countries is also not a good idea because they have marked their card and are vunerable

IMHO this would seem like the perfect response from the companies who have withdrawn from the US and are now desperate to get into the rest of world market but are sore that a good many offshore non quoted poker sites have decided they actually dont have to answer to this law (maybe rightly or wrongly)

It doesn't seem to be consistent with any of the other legal advice going around - ie. cardplayer etc

The bill is about payments to poker sites - not US players playing poker & more importantly to affiliates - many offshore sites do NOT consider themselves to be out of US market under the new law

How if these sites have publicly stated they are not breaking the law are poker affiliates supposed to be somehow implicated by association - if we are only reporting on statements by these sites ?

EG. if poker.com states (which it has) publicly that it does not consider itself to be breaking a US law because it does not have to recognise it (it's not US company and is operating under international law)

how am I as an affiliate (non US) breaking a US law (again I'm non US) if I promote by reporting / stating that poker.com has said it accepts US players ??????

What you seem to be saying is that offshore companies & affiliates have to obey a US law on transactions (which is not the same as a ban) when they are not US companies - if its no illegal for US poker players to play - how can I be held responsible ?

cheers scrawnybob

scrawnybob · #14 10-06-2006, 07:43 AM

hi

I guess what concerns me about the original post is that it makes far wider ramifications if you were to take their legal advice.

Dont get me wrong this is all valid discussion and to a point in places I am playing devils advocate but it does contradict totally

a) contradict totally the legal advice of the sites outside of the US planning to stay in US market

b) contradict totally cardplayers article on the legalities of the bill and implications

c) through up alot of other issues if you take there legal view

The idea that I as an affiliate would be implicating myself by posting the statements made by poker site - both staying and going is somehow going to get me into legal problems seems well scary and not wholy logical

following through their logic and in part suggestions all affiliate in every corner of the world ends up -

Unable to get any US player signups to sites (like party) who are withdrawing (very high % of the 70% of players who are US based) OK

Unable to comment on any of the things happening or attract attention to yourself commenting on legal statements made by sites remaining

No advertising / rev from any of the sites who have said they will stay - for legal reasons seeming to suggest not to US players
and for risk of lost rev to any players anywhere because those sites might be at risk from prosecution.

This would leave us with next to nothing to promote - infact we would only promoting Party Poker and the others who have pulled out of the US market but only promoting them to the rest of the world.

Fortuneatly this doesnt seem to be the concensus - otherwise I dont see what would be left - 1000x more affiliates in a market 90% smaller

On the legal side of commenting on site closures and open to US players (and effectively the supply of this information leading to people signing up through an aff site) ...

Since when did this US Law become a worldwide censorship bill allowing the US Govt to prosecute someone republishing public information for the purpose of informing someone ???? -
where upon they make they're own decision.

IMHO the statements release by the Poker Sites staying in the US act as much in an affiliates potential defence as they would in their attack

To my way of thinking that published statement enables me as an affiliate to say "hey they said they werent breaking some other countries law - here it is in B&W - take it up with them before you try to involve me"

I might be wary of sites that havent declared either way - but seriously I dont think these sites have stuck their necks out thinking they are wrong

What the original post is suggesting if you want to do it all by the book - and personally I always want to try (but dont agree with the post) -

Is total suicide - it would mean cutting out promoting to anywhere any sites who allow US players on the basis that one US sign could implicate you - using their logic that there is no way to stop a US signup happening
distance your self away from any advice / information on the Bill ??

Using that logic - poker is still the grey area it was before - so do we take down anything that discussed poker for fear of the Feds ???
then we have nothing

Now by following this logic IMHO you arrive at another counter arguement - application of the US bill / law to the extent suggesting in original post (which I dont believe it has the power or the will to do) would be illegal in itself under international law because it would be effectively stopping me and others as non US citizens from marketing a perfectly legal product to other places in the world due to the US threat of prosecution under their law that I would not be trying to break ...

In other words -

If the US bill stops me as an affiliate from marketing only to non US customers site xyz which legitmately operates globally and also operates in US - then the bill has affected me unlawfully from going about my legal non US business by default.

And here I do play devils advocate -

PartyPoker pull out of US (possibly an over saturated market) where their name is known to everyone and they are by far the biggest player (with stars), share price falls, affiliates are cut out from their future rev & party decide to cut the divy - freeing up $114m to pursue other markets

You cant tell me in the highest of the high board meeting no-one thought hmm on the bright side of deciding to pull out - we could in the future go back into the biggest market in the world NOT needing affiliates because everyone knows our name - to an accountant thats like a genius idea.

cheers scrawnybob

JacksNQueens · #15 10-06-2006, 11:24 AM

I have read all the posts here and this is a good and necessary discussion. Many people are confused about this new law including many of the large gaming sites. Let's clear up a few things:

1. The law makes it illegal for any business involved in betting or wagering to accept funds from US players.

2. Affiliates are not specifically targeted in the new law.

3. Where your business is, where your servers are, where your bank is are all irrelevant with regard to the enforcement of the law. The important nexus for the law is US players using financial transactions to make wagers or bets. So all online gaming sites that have US based players will be breaking the law.

4. The arguements about international law or being based overseas are all nonsense. You can say all you want your not breaking the law but any gaming site accepting US player deposits will be in violation. The only law that matters to the U.S. here is U.S. law.

5. It is not illegal for US based players to play online. It is only illegal for the gaming sites to accept their money.

6. Many people think that the overseas gaming sites are untouchable by this new law. The new law has provisions that will allow court orders to block these sites from being allowed in the U.S. market. So as an affiliate you could spend the next six months promoting say FullTilt and then they receive a court order shutting them out of the U.S. leaving you with nothing.

7. Many people also believe NETeller is beyond the reach of this law as well. Let me describe the very real and likely problems NETeller could have. The US banks under these new regulations could very easily tell NETeller that since the primary business of NETeller is online gaming transactions and the new law forbids this from US customers that they are no longer going to accept or allow EFT (Electronic funds transfers) to NEteller. Firepay is also in this same boat. US banks have very little incentive to help NETeller as they make virtually nothing from these transactions with NETeller.

Hope this clears up some issues.

Blake
Affiliate Manager
JacksNQueens.com

SharkScope · #16 10-06-2006, 12:06 PM

Quote:

Originally Posted by JacksNQueens

1. The law makes it illegal for any business involved in betting or wagering to accept funds from US players.

This isn't true. It makes it it illegal for any business involved in betting or wagering to accept funds from US players where the gambling is unlawful. The gambling had to already be unlawful for this law to apply.

Quote:

Originally Posted by JacksNQueens

7. Many people also believe NETeller is beyond the reach of this law as well. Let me describe the very real and likely problems NETeller could have. The US banks under these new regulations could very easily tell NETeller that since the primary business of NETeller is online gaming transactions and the new law forbids this from US customers that they are no longer going to accept or allow EFT (Electronic funds transfers) to NEteller. Firepay is also in this same boat. US banks have very little incentive to help NETeller as they make virtually nothing from these transactions with NETeller.

If banks decide to shut off Neteller then a 3rd party European bank will act as a further intermediary.

JacksNQueens · #17 10-06-2006, 03:41 PM

Yes its true that the law says where gambling is unlawful. Two points on this matter:

1. The law would clearly apply where a gaming site had customers in US states that had laws prohibiting online gaming (Nevada, Louisiana..etc)

2. Also the US Justice Department has already stated that it believes all online gaming violates current US law.

Now you may disagree with the US Department of Justice and think that they are all wrong, and with all of the lawyers for PartyPoker and all of the other big firms that have misread the law and have just given up hundreds of millions of dollars when in fact they would be all operating legally. However, I think its pretty clear if your are an online gaming site with US customers you will be breaking the law.

Many people confuse the fact that the online gaming sites will be operating illegally with the likelihood of the online gaming site operators being arrested or having the online gaming operations shut down.

The online gaming operations can be shut down via blocking of IP addresses. Arrest warrants can be issued for the owners and operators, but it is possible that the owners and operators will simply stay overseas and never be arrested. Which goes to the point that being indicted and not arrested is not the same as acting legally.

The biggest problem for affiliates is not the risk of being arrested. It is that gaming sites you get your money from will not be able to operate in the same manner they operated previously. The current sites publicly flaunting the fact that they are taking US customers are simply making themselves targets. The more arrogantly and publicly you see a site act the higher up the target list they move.

Finally with regard to NETeller and others like them, don't underestimate the power of fear that US and European banks will have about any possible criminal liability they will have should they knowingly violate the banking regulations that will be created for this law. NETeller is already identified as a gaming transaction company and no bank is going to risk their US operations or connections for NETeller's sake.

Again, my main point is that the game has changed and that the companies and affiliates who want to continue to operate in the US will have to change as well.

Blake
Affiliate Manager
JacksNQueens.com