Federal ban on Internet gambling lifted, raising hopes that California will follow
By Jake Greenberg
Jan. 20, 2012 2:17 a.m.
Once a week, the Poker Club at UCLA meets off campus to discuss strategy, look at uncommon hands and, of course, play some poker.
Sometimes the members play for money, but more often they just play for fun.
What they cannot do, however, is play poker for money on the Internet.
Online gambling is a contentious topic that raises questions about online regulations, gambling addictions and taxable revenue for the state.
Poker, blackjack and sports betting, with the exception of horse racing, were previously illegal in the U.S. over the Internet. Last year, the FBI shut down several large online poker sites, locking users out of their accounts and money.
In December, however, the U.S. Department of Justice released an official change to the 1961 Federal Wire Act, allowing everything but online sports betting. The measure was originally passed to limit mob activity in sports betting, said Robert Jacobson, the executive director of the California Council on Problem Gambling.
Laws about gambling online were formed based on these rules concerning phone gambling. Since the Department of Justice has lifted the ban on Internet gambling, states will be able to decide if they can legally sell state lottery tickets online.
About 3.7 percent of Californians are currently addicted to gambling, according to Jacobson. Concerns about legalizing online gambling in California are based on fears of increasing the number of addicts, Jacobson said.
Most students, however, are tired of having to go to a casino to play poker for money and would welcome a chance to gamble online, said Aman Rangan, the president of the Poker Club at UCLA and a third-year biochemistry student.
But online gambling’s convenience is one reason it is more dangerous than traditional casinos, said Dr. Timothy Fong, codirector of the UCLA Gambling Studies Program.
“Online is one of the most potent ways you can gamble,” he said. “You can play multiple hands at once, you don’t have to leave your home, and you can play 24 hours a day.”
In a study conducted in 2007, Fong and his colleagues discovered that about 20 percent of UCLA students play online poker just for fun. They also discovered 4-5 percent of UCLA students play for money.
The arrival of new technology can drastically increase the number of people playing online, Fong said.
“Times have changed,” he said. “When we first did the study, students weren’t carrying iPods or iPads, which make it much easier for students to play poker, for fun or for money.”
Rangan pointed to the potential profits for California if it allows online gambling.
“If it were legal, it could be taxed,” he said. “People are going to gamble online regardless if it’s legal or not, so the government might as well make some money.”
In the past, the government has lost out on revenue because online poker companies have been based overseas and the portion of each person’s winnings that they take does not go to the U.S., Fong said.
“You have to look at where the money is coming from and where it’s going,” he said. “We’ve lost millions or billions of dollars overseas to these companies, and it will never be seen again.”
But there are still a lot of unknowns concerning legalization.
Allowing people to buy lottery tickets online opens the door for other online gambling, but there are also potential benefits, Fong said.
“We’ve had online gambling for years, and it’s not hard to play poker or place a bet online,” he said. “At least people will now be able to do it legally, and we might as well deal with this issue.”
Fong said he remains wary about opening up unrestricted gambling online because it could lead to greater levels of addiction. But that is difficult to determine, he said.
“The question is whether we want to open the door at all,” he added.
