Thursday, August 13, 2015

Sen. Feinstein responds (sort of)

A few weeks ago, I posted a letter that I had sent to Sen. Dianne Feinstein regarding her surprising support of the Sheldon Adelson-sponsored (some would say "bought") Restoration of America's Wire Act, a Federal bill designed to extend the powers of the Wire Act far beyond its authors' intent. I finally received a response today. While I didn't expect a personal reply, I honestly expected better than what I got - a form-letter response that reiterates her position and makes it clear that she's consumed a large dose of Adelson Kool-Aid. Her response follows, with my further response below.

For more on Adelson's attempt to buy Congressional support for this absurd bill, click here.

Dear Daniel:

Thank you for contacting me to express your support for Internet poker.  I appreciate knowing your views, and apologize for the delay in my response.

On February 4, 2015, Rep. Jason Chaffetz (R-UT) introduced the "Restoration of America's Wire Act" (H.R. 707), which would update the Wire Act to cover a broad range of Internet gambling.  The bill would thus return the statute to the interpretation given to it by the Department of Justice prior to 2011.  As you may know, I am a cosponsor of legislation (S. 1668) in the Senate.

I understand that you support the legalization of Internet poker.  I am afraid that this is an issue on which we must agree to disagree.  The dangers of Internet gambling have long been an area of concern for the FBI and other law enforcement agencies.  I share their view that Internet gambling is too easily accessible to minors; subject to fraud, money laundering, and criminal misuse; and too easily used as a tool to evade state gambling laws.

The "Restoration of America's Wire Act" has been referred to the House Judiciary Committee.  Please know that while we may not agree on the legalization of Internet gambling, it is helpful for me to hear your perspective on this issue.  I respect your opinion, and will keep it in mind should the "Restoration of America's Wire Act" come before me in the Senate.

Once again, thank you for writing.   I hope you will continue to be in touch on issues that matter to you.  Should you have any additional comments or concerns, please do not hesitate to contact my Washington, D.C. office at (202) 224-3841.

Sincerely yours,

  Dianne Feinstein
         United States Senator


Dear Sen. Feinstein,

I find your response disturbing in the extreme. It's OK with me that you sent a form letter response - I know that you must get thousands of emails every month. But a form letter, three weeks after my original email, that clearly doesn't address the issues at hand, is surprising and unacceptable from my elected Senator. I would hope that you have a human being who reads your email, but apparently either that's not the case, or someone decided that the issues I raised aren't worthy of comment. Either of these is disappointing and unacceptable.

On the assumption that perhaps a human reads THIS email - the views you describe in your response are quite out of touch with reality. What you said was:
"I share [the FBI and other law enforcement agencies'] view that Internet gambling is too easily accessible to minors; subject to fraud, money laundering, and criminal misuse; and too easily used as a tool to evade state gambling laws."

The view of law enforcement is only barely relevant. Law enforcement in the 1950s largely supported segregation, also. This is a legislative matter, not a law enforcement one (and it does not reflect the current position of either the Department of Justice or the FBI). The issues are far larger than this, and in fact each of the views you describe have been dealt with by the dozens of countries in which online gambling is legal. Specifically:

Underage gambling: There is no question that this is a key issue in this discussion. Industry estimates of underage gambling range from 1-2% of all online players - roughly the same percentage as the estimates for underage gambling in live casinos. And the means of verification and enforcement are far better online than in live casinos, who often let underage players play until they win, and then deny claims.

Subject to fraud: Having been in the industry for many years, I can tell you first-hand that online fraud (specifically credit card fraud, which I believe is what you refer to) is substantially lower than live credit card fraud. This is a regulatory and enforcement issue, and makes little sense as an argument against the industry at large.

Money laundering: This is certainly the most laughable of your claims, although it's been part of Sheldon Adelson's playbook since his campaign against online gambling started five years ago. Live casinos accept cash for over 90% of their transactions, making them far more vulnerable to money laundering than online casinos and poker rooms, whose money sources are nearly 100% traceable. As a glaring example, Mr. Adelson's own company settled a huge money-laundering claim in 2013 as a result of The Venetian's acceptance of $45 million in cash from a known drug trafficker. This crime could not have taken place online, as transactions as small as $10,000 are routinely examined and audited.

Tool to evade state gambling laws: I'm honestly not sure what this means. The vast majority of US casinos support legalization of online gambling. Properly implemented, online gambling can easily be restricted to defined state borders. This has been accomplished in Western Europe, where most countries have legal, regulated online gambling, as well as the three US states that have legal, regulated online gambling. What is your actual concern?

The bottom line is that a majority of your constituents, as well as a majority of casinos, support online gambling. Your arguments against legalization, while they may read well as bullet points, don't hold up to even the lightest scrutiny. If you have someone on your staff who actually understands these issues, I strongly urge you to have them either (1) articulate arguments against legalization that represent legitimate concerns that can't be resolved by regulation and stringent enforcement, or (2) stop obfuscating with irrelevant arguments.

Your position on this matter continues to make no sense. I look forward to hearing any reasonable arguments you have that support your arcane position on this matter.


Daniel Goldman

1 comment:

  1. I hope you're not surprised; I'm not. Both of your Senators (Feinstein and Boxer) are anti-online gambling. I wrote a brief parody about this back in 2005; ten years has passed and nothing has changed.