WHAT IS UIGEA?

In 2006, a few Republican senators attached a Bill to the Safe Ports Act going through the US Congress shortly after the events of 9/11. While it could be argued that online gambling had nothing to do with “Safe Ports”, the amendment was still attached and - as expected - it passed. The Unlawful Internet Gambling Enforcement Act means that it it’s not legal for a US bank or financial institution to take payments made between residents of the US and online gambling websites offshore. Playing online poker itself is not illegal according to this legislation. Rather, the financial transactions are targeted. Getting dollars into players’ bank accounts, or allowing players to make deposits to poker online sites, is now trickier.

UIGEA'S EFFECTS ON POKER ONLINE AND WHAT IT DOES

For nearly four years, the law sat on the books while the US Department of Justice figured out a stance on the “legality” of online poker. The DoJ then decided to prosecute based on the wire transfers being sent to and from these web-based rooms, deciding they were evading not only taxation but also illegally avoiding declaring themselves as payment processors, thus putting them in violation of the UIGEA. The decision the DOJ eventually came to was to target wire transfers between these web-based rooms. They judged these transfers to be tax evasion and the poker sites undeclared payment processors, which meant they were violating the UIGEA. The result was that the three biggest online poker sites in the USA got shut down: PokerStars, FullTiltPoker and Absolute/UB.com. Access to the sites was blocked and their funds frozen. The day this happened, April 15th 2010, has been dubbed “Black Friday”.

This move shook up the industry and made processing payments extremely difficult, shrinking the player base considerably. However, legal US facing websites still exist and have created legal methods of taking deposits from players, and paying out winners.

CURRENT LEGISLATION

Several bills have been introduced in the US House of Representatives and Senate to legalize and regulate online poker in one form or another on a federal level. In essence, they are an attempt to remove grey areas on payment processing and force categorization of poker online and other forms of e-gambling. As of July 2013, none of these bills have yet to receive the needed votes to become law and open the doors for the industry to return, but the rise of intra-state poker and some new attempts on the floor of Congress are changing the shape of things.

On a Federal level, Republic Senator Peter King (New York) introduced a Bill in early June of 2013 titled the 'Internet Gambling Regulation, Consumer Protection and Enforcement Act of 2013'. It is still pending “mark up” but it does not appear to have any more support than the Bill it was based on - that championed by Democrat Senator, Barney Frank.

On a state level, as of July 2013 only Nevada has passed and executed an intra-state online poker law, opening the gates to NV residents only. New Jersey is hopeful for its current legislation and NV based Ultimate Poker recently announced a partnership with Trump Casinos. Pennsylvania, California and a few other states are in the early stages of their own intra-state legal maneuvers.

EXPECTATIONS FOR THE FUTURE OF ONLINE POKER

While Federal regulation, taxation and monitoring are the goals for the PPA (Poker Players Alliance) and online poker fans in America, it looks like the immediate future is in intra-state gaming. Once enough states have licensed intra-state poker, it stands to reason they could join together to create bigger player pools and share in bigger profits. Federal efforts continue, but don't appear to be close to a solution. Be sure and check your state's laws to see if and how they've responded to poker online before you decide to play Texas Hold'em online. In the meantime, pokeronline.us will keep you abreast of all the latest developments as and when they happen.