You're kidding right? Legal confusion over Internet horse race wagering

[andymays]

http://www.saratogian.com/articles/2010/06/20/news/doc4c1d7fadc3e61167536124.txt

Excerpt:

SARATOGA SPRINGS — Confusion over the legality of Internet horse race wagering could cost the thoroughbred industry hundreds of millions of dollars annually.

A 2000 amendment to the Interstate Horseracing Act of 1978 permits Internet wagering on racing.

However, the Department of Justice says 1961 Wire Act provisions might still make it illegal, because of a 2006 act that prohibits Internet wagering on illegal forms of gambling, such as some offshore gaming.

The confusion has caused issuing banks, as of June 1, to stop processing transactions on Internet horse racing wagers.

Last year alone, pari-mutuel Internet wagering on races at Aqueduct, Belmont Park and Saratoga totaled roughly

$210 million.

“This is a huge industry for us,” said U.S. Rep. Scott Murphy, D-Glens Falls. “We just want it clarified.”

Internet wagering now accounts for about 10 percent ($1.3 billion) of all horse racing bets, said Peggy Hendershot, of the National Thoroughbred Racing Association. “We’ve been investing in online wagering for about 10 years,” she said. “More than the financial impact, you’re frustrating a consumer who wants your product.”

http://www.saratogian.com/articles/2010/06/20/news/doc4c1d7fadc3e61167536124.txt

[DJofSD]

There can not be a better example of the stupidity, ignorance and lack of understanding by Congress. As individuals they're all idiots. As a collective body, they are an embarrassment.

[shouldacoulda]

When they passed the law in 2006 It was my understanding that horse playing was specifically exempt. Don't these people have anything better to do like, jobs, oil leaks, foreclosures, massive government deficits out of control? No, lets pick on horse racing. Getting kicked when your down is bad enough, it shouldn't be our elected officials doing the kicking. :bang: It seams our government is heckbent on destroying every last profitable industry in the country. What gives?

[Hoofhearted]

I understand that the New Jersey Legislature will tomorrow decide upon whether to legalize exchange betting for horseracing, is this correct?

If such a proposal is passed, surely this will be a landmark decision, no? Clearly other States will then follow suit resulting in a huge increase in volume and liquidity in the exchange markets when the enormous U.S. betting community realising that they can bet (and lay) at a 100% book.

[thaskalos]

I understand that the New Jersey Legislature will tomorrow decide upon whether to legalize exchange betting for horseracing, is this correct?

If such a proposal is passed, surely this will be a landmark decision, no? Clearly other States will then follow suit resulting in a huge increase in volume and liquidity in the exchange markets when the enormous U.S. betting community realising that they can bet (and lay) at a 100% book. The only legitimate question would be whether or not this will take place in our lifetime.

Our industry is not known for making quick decisions, unless it is in their short term financial best interest. I just can't see the horse racing "insiders" agreeing to the low take-out of the betting exchanges.

[Hoofhearted]

You don't believe, Thaskalos, assuming if New Jersey passes this motion tomorrow (as seems likely seeing that not one single opponent has spoken against it at the moment of posting) that Betfair/Betdaq will not immediately jump in and offer their services to New Jersey IP addresses???

[Hoofhearted]

I can't see what the vested interests can do to prevent it, tbh.

[toddbowker]

If it passes as it's currently written, the bill in NJ specifies that the NJSEA run the exchange, just as they are required to do with the regular account wagering system. The exchange could also only serve NJ customers. It does not allow them to match bets outside the State.

The NJSEA certainly could partner with BetFair on the platform, but BetFair (via TVG) has too many US licenses to protect to just turn on the State in violation of the law. Others may try, but why are they not just trying now? There currently isn't a direct law in NJ that they would be violating, so passage of this law doesn't give them any more protection, it actually gives them less.

Seeing as this is bookmaking it would be naive to think the Feds are going to look the other way on this, and they are likely not going to be in favor of it. This could then force the resolution of the Wire Act / IHA 'problem' the DoJ currently likes to bring up, and adding bookmaking on horse racing into the mix doesn't help the cause.

Even if something were to pass, it will take a while for all the legal challenges to get resolved, and then the Commission will have to write rules. It's not just as simple as flipping a switch, but obviously partnering with someone that has a solid platform in place already will expedite things once the exchange is on solid legal footing.

Certainly if NJ gets it done, then I suspect other States will follow suit, but it's also probable that systems won't be available across State lines. This could obviously make the individual markets somewhat limited (in smaller States especially). Part of the beauty of BetFair is they have a large market (most of the world) and it's easier to get bets matched.

Will be interesting to follow this and see what develops during the process.

[Robert Goren]

If by some small chance this passes and an even smaller chance it survives the court tests, it will be come wide spread. Once genie is out of the bottle, it is very hard to get him back in. I, however, do not think it the savior of horse racing that many here do.

[kenwoodall2]

Why has the United States Horse Racing Commisioner not devised a code to use in bank wire transfers to make money going iinto horse betting distinct so as not to trip an alarm?

[horseking]

http://www.saratogian.com/articles/2010/06/20/news/doc4c1d7fadc3e61167536124.txt

Excerpt:

SARATOGA SPRINGS — Confusion over the legality of Internet horse race wagering could cost the thoroughbred industry hundreds of millions of dollars annually.

A 2000 amendment to the Interstate Horseracing Act of 1978 permits Internet wagering on racing.

However, the Department of Justice says 1961 Wire Act provisions might still make it illegal, because of a 2006 act that prohibits Internet wagering on illegal forms of gambling, such as some offshore gaming.

The confusion has caused issuing banks, as of June 1, to stop processing transactions on Internet horse racing wagers.

Last year alone, pari-mutuel Internet wagering on races at Aqueduct, Belmont Park and Saratoga totaled roughly

$210 million.

“This is a huge industry for us,” said U.S. Rep. Scott Murphy, D-Glens Falls. “We just want it clarified.”

Internet wagering now accounts for about 10 percent ($1.3 billion) of all horse racing bets, said Peggy Hendershot, of the National Thoroughbred Racing Association. “We’ve been investing in online wagering for about 10 years,” she said. “More than the financial impact, you’re frustrating a consumer who wants your product.”

http://www.saratogian.com/articles/2010/06/20/news/doc4c1d7fadc3e61167536124.txt

The stupidity is that UIGEA defined interstate horse racing as legal....HOWEVER, what is interesting is that if UIGEA is thrown out AND they don't bring in new legislation legalizing online gaming/horse racing, then technically horse racing returns to the "grey area" it was in before....even though, by all accounts, it was considered legal by most prior to UIGEA.

Craziness.

[Mike_412]

I thought this part of the exchange wagering bill was pretty interesting. Unless I'm having a case of the Mondays, I'd assume it to allow the ability to pool liquidity. I'll link the rest of the bill for those curious.



“Interstate Exchange Pool” means an exchange wagering system





established within this State or in another state or foreign nation

within which is combined unmatched wagers on one or more horse

races in order to form identically opposing wagers.

http://www.njleg.state.nj.us/2010/Bills/A3000/2926_I1.PDF

[Black Ruby]

An article I read said that banks MAY overblock a transfer to an ADW, but they don't have to block it. I tried to make a deposit to an ADW account last night, it was declined. I emailed my bank and asked them if their policy had changed. I received a reply that said I'd never been able to use my check card to transfer money to TS or TVG. I responded with dates of the last transactions with each ADW using the card. Waiting for a reply, should be interesting to see if any of the banksters even know about the change that they instituted.

[Robert Goren]

I suspect what they will tell you is that you should not have been able to do it. It was their bad and you aren't going to be able to it again. Start looking for another bank.

[Black Ruby]

I suspect what they will tell you is that you should not have been able to do it. It was their bad and you aren't going to be able to it again. Start looking for another bank.

Well, the "Only in America" moment here is that I just learned that I can still fund a TVG or TS account using their respective methods where you register a bank account and it comes straight out of there without using a credit or debit card!! Same bank, same ADW's.

[Robert Goren]

Well, the "Only in America" moment here is that I just learned that I can still fund a TVG or TS account using their respective methods where you register a bank account and it comes straight out of there without using a credit or debit card!! Same bank, same ADW's. I can do the same thing. I am not going tell the bank about it. I am still am not convinced that it is the banks causing the problem. I think it maybe the credit card processers.

[Black Ruby]

I'm not telling the bank either! I've asked some of my buddies if they've had this happen, and what bank issued the CC if they got a deposit through.

[toddbowker]

The beginnings of the difficulties on using credit cards for gaming transactions actually started back in 1999 with the Cynthia Haines case. She sued her credit card issuing banks and MC and Visa over debts she rang up on her CC's making deposits to online casinos. She later settled the case against MC, and ended up winning against several of the other parties.

http://news.cnet.com/Net-gambler-settles-suit-against-MasterCard/2100-1023_3-228321.html

Once the dust settled many issuing banks stopped allowing transactions that were done with the gambling merchant code. We had an ironic situation at AmericaTab where the bank that we had our merchant account with wouldn't allow their own cards to make deposits with us. It was a crazy few months during the transition. At any rate, over time more and more of the issuing banks started blocking the transactions on Credit Cards, but some still allowed debit cards. There were also cards that worked one day, and didn't the next. Our customer service staff actually kept a list of those issuing banks whose cards they knew were working and referred customers to them. We ended up processing most of our CC deposits using a cash advance company which seemed to still work for most cards at the time.

I know that AmericaTab and some of the other ADWs had discussions with various issuing banks, and that other industry organizations met with MC and Visa to try to figure out how to get things resolved because online wagering on horse racing was legal. The nearly universal response from the banks was that they didn't want to have to be put in a position of evaluating each potential ADW to determine whether or not they were operating legally. The legal teams decided to just employ the 'scorched earth' method of dealing with things.

Certainly the UIGEA is making things even more difficult now, and the banks are taking the same position of not wanting to have to be the ones making the decision on who to allow to do transactions. They will want the federal government to do that by virtue of either overturning or amending the Act, or modifying the IHA to spell out that those transactions are legal. Compliance Officers are running the show on this one, and they will do anything to ensure they don't run afoul with the DoJ.

So for now, I would expect more and more banks to start rolling out the bans, and would also suspect ADWs will be trying hard to find new ways to process payments.

[Hammerhead]

It does not appear to be the banks but the card companies themselves.

I got the notice yesterday to call my card holder (debit card) I called my bank (BA) and they said every thing was fine and that there was no activity on my account yesterday. It is apparently being stopped by Visa, MasterCard before it hits the account. I tried the express cash and it worked flawlessly.

[toddbowker]

It does not appear to be the banks but the card companies themselves.

I got the notice yesterday to call my card holder (debit card) I called my bank (BA) and they said every thing was fine and that there was no activity on my account yesterday. It is apparently being stopped by Visa, MasterCard before it hits the account. I tried the express cash and it worked flawlessly.Mastercard and Visa do not make decisions about which transactions are allowed and which are not. Credit card validations and approve/deny decisions are all done by the bank that issues your card. Mastercard and Visa also no longer issue cards. They license their names to the credit card issuing banks and provide the framework for the use of cards with their logos.

One of those rules is that anyone holding a merchant account has to accurately represent the type of business so it can be coded properly. Gambling merchants get a 7995 code. The merchant code passes to the issuing bank with the transaction and the issuing bank decides how to handle it. With the UIGEA in play, they are now being rejected.

PS ... the issuing banks will often lie to customers because they don't want to lose them. We saw a lot of that in our customer service office. Normally they would tell the truth if a customer called and asked them directly if they allowed online gambling or 7995 transactions. If a customer just called and said they had a transaction from [insert ADW] rejected, they would always say they had no record of it even though we received a rejection code (I think it was 15) from the issuing bank.

[DJofSD]

Todd, it is very obvious you have an insiders view of the industry. I appreciate your sharing of this information.

After reading the last message in this thread, I decided to do a little bit of poking around the internet. Here's the first hit: http://www.osga.com/artman/publish/article_7961.shtml

[Unome]

Todd, it is very obvious you have an insiders view of the industry. I appreciate your sharing of this information.


Todd was responsible for bringing ADW's out of the stoneage years ago and knows everything there is to know about running a successful ADW.

This business needs more people like him and less of the suits that have driven the business into the ground.

[toddbowker]

Todd was responsible for bringing ADW's out of the stoneage years ago and knows everything there is to know about running a successful ADW.

This business needs more people like him and less of the suits that have driven the business into the ground.Thanks ... your endorsement check is in the mail .... :D

However, I will have to say it was never just me and I will never claim to know 'everything'. I was fortunate to have a great staff at AmericaTab, and access to some excellent developers at Bloodstock Research. A number of those people are still working for TwinSpires, and I like what they have done with the site since the merger. They have added some great things, and I'm sure it will continue once they start integrating some of YouBet's unique features into the platform.

Most importantly though, we also had great customers .... many of whom that were not shy about telling us things we could improve on. That was actually one of the fun parts of the job ... doing the new and cool things that came from customer ideas.

[Pace Cap'n]

UIGEA = Unlawful Infringement upon Gaming rights of Every American

[Shelby]

I reside in Kansas.

I used to use YouBet.com, but they no longer let me wager????!!!

I've just signed up for a twinspires account and, so far, I don't see anything that won't let me wager online. I've searched for clarification of Kansas internet wagering laws, and I can't find anything that clearly states the rules.

I have TVG on my satellite, but they won't let me wager from the state of Kansas, either. :(

Am I going to get a knock on my door and be thrown in jail lol?

[DJofSD]

I seem to recall a page on the Twinspires site that listed the states they are serving. I tried to find it however it appears they are down -- neither IE or FF can display the home page.

[kenwoodall2]

Today the Ca Govt is voting on whether to allow all types of online gaming, with state sales tax.

[Robert Goren]

E-mail Twinspires, they may have a sister site that takes wagers from Kansas. I live in Nebraska and have to use Betpad. It may seem stupid, but there are reasons for it. Good Luck

[Black Ruby]

[QUOTE=toddbowker]Thanks ... your endorsement check is in the mail .... :D

However, I will have to say it was never just me and I will never claim to know 'everything'. I was fortunate to have a great staff at AmericaTab, and access to some excellent developers at Bloodstock Research. A number of those people are still working for TwinSpires, and I like what they have done with the site since the merger. QUOTE]

Todd, if you happen to speak with these people working for TS, would you recommend that they fix the voice prompts on their automated phone betting, please? The prompts are cut off, so that you don't here all of what they're asking you to enter. Also, one or more of the numeric codes for bet types aren't recognized when I enter them. I believe the last one was for an exacta wheel. Trying to tell the operators about this stuff hasn't yielded any results. Thanks.

[garyscpa]

Today the Ca Govt is voting on whether to allow all types of online gaming, with state sales tax.

You've got to be kidding. They have the gall to sales tax the transaction on top of getting part of the track take? How stupid are they?

[Robert Goren]

You've got to be kidding. They have the gall to sales tax the transaction on top of getting part of the track take? How stupid are they?How much of the track take does CA get? It used to be that states almost everywhere got 5% of the handle. I don't think that happens anywhere now. I know here in Nebraska they get none now. That 5% now goes to purses.

[Hedevar]

Why has the United States Horse Racing Commisioner not devised a code to use in bank wire transfers to make money going iinto horse betting distinct so as not to trip an alarm?

Who would the United States Horse Racing Commissioner be?

[precocity]

now i love going to walgreens and buying a green dot money pack just to put money in my twin spire account? makes me feel like a sneaky little kid again............... :lol:

[Wickel]

E-mail Twinspires, they may have a sister site that takes wagers from Kansas. I live in Nebraska and have to use Betpad. It may seem stupid, but there are reasons for it. Good Luck

Initially, the same thing happened to me. But recently I was switched back to Twin Spires. I live in New Mexico, one of the state's with ambiguous Internet gambling laws, thus the switchover to BetPad earlier. Don't know what's going to happen. I also have an accounts with YouBet, Horseplayers and Philly Park on which I wager freely.