If Thursday’s planned Congressional hearing on sports betting has an air of familiarity to it, you’re not mistaken. Anti-Internet gaming proponents – who failed three years ago to get the Interstate Federal Wire Act restored to its pre-2011 interpretation – are now scheduled to participate in the discussion, which was originally titled “Post-PASPA: An Examination of Sports Betting in America.”
Capitol Hill sources weren’t sure how John Kindt, a University of Illinois professor of business and legal policy who is a gambling opponent, and Jon Bruning, a former attorney general of Nebraska and counselor to Coalition to Stop Internet Gambling, ended up on the panel.
“They (anti-Internet gaming forces) spend a lot of time talking about Internet gaming,” said Sara Slane, the American Gaming Association’s senior vice president of public affairs, who will be testifying Thursday. “Anytime there is a hearing on gaming, they will be involved.”
The House Subcommittee on Crime, Terrorism, Homeland Security, and Investigations is holding the hearing, which will also include testimony from Nevada Gaming Control Board Chairwoman Becky Harris and Jocelyn Moore, executive vice president of communications and public affairs for the National Football League.
The panel wants to look at the growth of sports betting and potential federal involvement in regulating the activity after the U.S. Supreme Court ruled in May that the 25-year-old Professional and Amateur Sports Protection Act was unconstitutional, opening the door for all states to legalize and regulate sports betting.
“An examination of sports betting in America, as the hearing is entitled, requires an examination of the online gambling industry around the world,” former Arkansas Senator Blanche Lincoln, an advocate for the Coalition to Stop Internet Gambling, said in statement emailed by the public relations firm for the organization. “As victims of the industry’s ruthless schemes know far too well – and as lawmakers will soon learn – online casinos consistently fail that examination.”
Lincoln, a Democrat, called online casinos “predatory.” She said the organization was “encouraged by the House Judiciary Committee’s commitment to utilizing Thursday’s hearing to learn more about the predatory practices upon which the online gambling industry relies.”
The Coalition to Stop Internet Gambling was originally funded by Las Vegas Sands Corp. Chairman and CEO Sheldon Adelson, a prolific GOP campaign contributor who vowed years ago to spend millions of dollars to kill Internet gaming.
In the last month, two U.S. senators, Republican Orrin Hatch of Utah and New York Democrat Chuck Schumer – the Senate Minority Leader – called for potential federal guidelines and oversight of sports betting.
Slane and Harris are expected to testify that federal oversight of sports betting is unnecessary.
“There are 40 states with some form of brick and mortar casinos,” Slane said Tuesday. “There are 4,000 gaming regulators working with a budget of $1.3 billion. I don’t think there is any need to talk about federal regulation and adding another level of bureaucracy.”
Slane said the casino industry already has a form of federal oversight from the U.S. Department Treasury. Casino leaders and Treasury representatives have formed a partnership to ensure the industry complies with anti-money laundering laws and the Bank Secrecy Act.
“Nevada has been engaged in sports betting for 40 years and we have a mature jurisdiction,” Harris said last week. “Our strict regulations are enforced, and we are in the best position to understand how sports betting will be regulated.”
Since June, Delaware, New Jersey, Mississippi, and West Virginia have launched legal sports betting operations at casinos and racetracks. More than a dozen other states are considering sports gaming legalization.
Two members of Congress, who are not part of the subcommittee but represent states which have legalize sports betting, said in a letter Tuesday “success” in regulation on the state level makes federal oversight unnecessary.
Democratic Congresswoman Dina Titus of Nevada, and Republican Congressman Tom MacArthur of New Jersey, said in the letter – which was sent to the subcommittee members – that legal and regulated sports betting is helping squash an illegal sports gambling market that the AGA estimates is a $150 billion a year business.
They cited Las Vegas, where professional sports and legal sports wagering have shown the ability to co-exist.
“A heavy-handed federal framework could repress innovation and competition, sending more people back to the illegal market,” Titus and MacArthur wrote.
Three years ago, the House Committee on Oversight and Government Reform – which oversees the subcommittee overseeing handling Thursday’s event – held a hearing on a bill seeking to roll back the Interstate Federal Wire Act to its pre-2011 interpretation.
Three witnesses who were opposed to Internet gaming, came off as uniformed on the topic. Even conservative Republican congressmen – who said they oppose all forms of gambling – thought the legislation violated the 10th amendment, which defines the balance of power between the federal government and the states.
The Wire Act, which was written in 1961 and deals with the transmission of wagers, applies only to only to sports betting and not poker and casino-style games.
Howard Stutz is the executive editor of CDC Gaming Reports. He can be reached at hstutz@cdcgamingreports.com. Follow @howardstutz on Twitter.
