Tuesday, April 12, 2011

Review-Journal business reporters don't know what they're talking about

I just sent the following letter to two Las Vegas Review-Journal reporters, Chris Sieroty, CSieroty@reviewjournal.com, and Steve Tetreault, STetreault@stephensmedia.com, with a copy to the Assistant Business Editor, Dan Behringer, DBehringer@reviewjournal.com. If I get any substantive response, I'll let you know.

Mr. Sieroty and Mr. Tetreault:

I am inquiring about the accuracy of two sentences you wrote in this story:


Specifically, you said, “Technically, online poker is not illegal in the United States. But participating in an online poker game where the participants are wagering money on the outcome is illegal.”

After reading it a few times, I'm guessing that the meaning intended is this: (1) It is not illegal to play poker online if the participants are not risking money. (2) It is illegal to play poker online if the participants are risking money.

I also assume that the word "illegal" in the second sentence means that the players themselves--not just the site's operators--are committing a violation of a criminal law, a prosecutable offense.

If those inferences are not correct, please inform me what was intended.

If they are correct, please tell me specifically what criminal provision you believe a person violates by playing in an online poker game for money. The next paragraph in the story references the UIGEA, though it's not clear that that is the law you are claiming players violate. I hope that that is not the law you had in mind, as it has no criminal provisions for players whatsoever.

I also hope that you did not have in mind the 1961 Federal Wire Act. For reasons that I detailed in a blog post a couple of years ago, neither it nor the UIGEA criminalizes the playing of online poker. See: http://pokergrump.blogspot.com/2008/07/knpr-gets-it-wrong-wrong-wrong.html

If you cannot point me to a specific federal statute (and from the context I am assuming you were referring to federal rather than state law) which makes it a criminal offense to play online poker--and I doubt that you can do so--then you owe your readers a retraction and correction.

Thank you.


Crash said...

Correct and well-said.

Elsewhere, I just lost with 2d4d and NEXT HAND with a crub flush draw! It's all your fault!

Pete said...

You do know that while you are correct about federal law, you are committing a misdemeanor by playing online poker while in Nevada.......

Jeff Simpson said...

Come on, Grump.
I admire your tenacity on the subject, but the Court of Grump isn't the highest court in the land.
There certainly could have been a lot more context in the R-J story, but plenty of entities -- including the Justice Department and the Nevada Gaming Commission have said they believe federal law (the Wire Act of '61) makes online poker (played for players' money) illegal. Of course, several federal courts have ruled that the Wire Act does not apply to online poker. (That point would have been good additional context in the story.) The Supreme Court has not ruled on the question yet, and may never do so.

You'll also notice that few owners and executives in charge of U.S.-facing poker sites like PS, FT and (sorry) UB/AP are willing to risk prosecution by setting foot in the U.S.

Here's a Las Vegas Sun link to the DOJ letter advising the Nevada Gaming Control Board on its position RE: online poker:


The letter/DOJ opinion has no force of law but it has persuaded Nevada gaming regulators.

And, separately, commenter Pete is also right about Nevada law. Nevada regulators and law enforcement officials have said they have no plans to prosecute players, but that doesn't make the activity any less illegal. Much less risky, sure.

I wrote two recent columns for ratevegas.com on the possibilities for federal and state online poker legalization/regulation:



Rakewell said...

Jeff: If the DOJ truly believes that an online poker player is in criminal violation of the Wire Act or other federal law, why have they not attempted even one prosecution? It would be trivially easy to prove "violations," as plenty of people hold themselves out to be professional online players, make videos of themselves playing, post them publicly, even charge money for access to the training videos, all while sitting in the U.S. Yet not one U.S. Attorney in any jurisdiction has gone for an indictment under either Republican or Democratic administrations. Why? The obvious answer is that, blustery rhetoric in public notwithstanding, they believe they would lose in court.

Jeff Simpson said...

I don't disagree with you at all on the lack of federal prosecution of players. Perhaps federal prosecutors feel they can bluster and get the same effect (from states like Nevada and NJ) without risking a court decision. On the other hand, certainly you'd agree that the poker-site owners and executives worry about federal prosecution and avoid subjecting themselves to U.S. jurisdiction.

Rakewell said...

Jeff: Yes, no doubt the operators have such worries. But the sentence in question in the story was not about the site operators. It was explicitly about the players: "But participating in an online poker game where the participants are wagering money on the outcome is illegal." At the very least, I think you'd have to agree that that is not so crystal-clear as to be journalistically justifiable as an unqualified statement of fact. Had they written, "The DOJ takes the position that...." or some other such qualifier, I wouldn't take issue with it.

Jeff Simpson said...

Yup, you're right. The journalists need to learn more about the subject and the paper should clarify the story.
BTW, I know you aren't a fan of U.S. regulation (and taxation) of existing websites, but wouldn't a Gaming Control Board hearing examining an Ultimate Bet Nevada licensing application be worth it?