NAGRA webinar overview. Summary derived from a February 2019 discussion concerning the USDOJ’s re-interpretation of the Wire Act. Presented by the North American Gaming Regulators Association.

NAGRA Webinar on New Wire Act Opinion (Preface)

In January 2019, the U.S. Department of Justice released a new interpretation of the Federal Wire Act arguing that the 1961 law applies to all forms of online gambling.

Since that time, there has been a slew of multi-jurisdictional legal activity signaling defiance of the revised OLC opinion — which some argue would affect not only “shared liquidity” online poker in America — but would also wreak havoc upon formally licensed, statewide lottery, sports betting and gambling interests while creating massive instability within the regulated U.S. iGaming industry.

The following NAGRA Webinar (recorded February 19th, 2019) includes analysis and commentary from former New Jersey Division of Gaming Enforcement (NJDGE) official George Rover and Ifrah Law managing partner Jeff Ifrah. It is moderated by current NJDGE Technical Services Bureau Chief Robert Moncrief, Jr.

It is intended for readers who are interested in gaining a chronological, timeline perspective on how states, casinos, operators, and lobbyists have reacted to the new USDOJ-OLC interpretation of the Wire Act, along with a summary of efforts being made to protect the interests of state-regulated gambling in the United States.

AUTHOR’S NOTE: Several comments from the one-hour discussion corroborate recently-aired concerns put forth by poker lobbyist Rich Muny, who believes the revised Wire Act opinion will pressure banks and regulators into compliance if it is not somehow rescinded, overturned, or otherwise clarified.

NAGRA Webinar: USDOJ Wire Act Opinion (Timestamps)

OFFICIAL NAGRA WEBSITE: North American Gaming Regulators Association

MODERATOR: Robert Moncrief, Jr. (New Jersey Division of Gaming Enforcement)
PANELIST: Jeff Ifrah (Partner, Ifrah Law PLLC)
PANELIST: George Rover (Partner, Princeton Global Strategies, LLC)

(0:00) <— Intro, moderator and guest credentials
(3:10) Overview, USDOJ re-interpretation of the Wire Act
(3:27) Revisiting the (since reversed) 2011 USDOJ opinion

George Rover NAGRA Webinar

George Rover (Princeton Global Strategies/former NJDGE official)

(5:22) Old opinion never acknowledged or made reference to the 2006 UIGEA
(6:42) Old opinion provided for lawful internet gambling if states legalized
(7:10) Jeff Ifrah on case law that supports old opinion
(8:00) IN RE: Mastercard International determined Wire Act only applied to sports betting (2002 – U.S. Court of Appeals, Fifth Circuit)

Because the Wire Act does not prohibit non-sports internet gambling, any debts incurred in connection with such gambling are not illegal.

(9:30) United States vs. Lyons determined Wire Act didn’t apply to internet poker or casino (2014 – U.S. Court of Appeals, First Circuit)
(11:14) SCOTUS overturned PASPA prohibitions (May 2018 – Murphy vs. NCAA)
(12:40) Old USDOJ opinion signaled states that they could legalize and regulate iGaming
(15:20) George Rover references MSIGA compact and its ability to link future states
(16:43) Industry reaction to the November 2018 USDOJ-OLC Wire Act opinion
(18:40) New USDOJ opinion states that Wire Act applies to all forms of internet gambling (not just sports betting) and that the “UIGEA did not alter the scope of the Wire Act
(20:23) Old opinion had provided “comfort” to online lotteries and commercial iGaming
(20:55) The USDOJ provided a 90 day compliance window to affected interests

RELATED: DOJ Set to Extend Wire Act Compliance Deadline by 60 Days (Chris Grove – Feb 28, 2019)

(21:57) Takeaways from new DOJ Office of Legal Counsel opinion concerning the Wire Act
(23:53) Wire Act enforcement could begin once the prosecutorial grace period ends
(25:00) What prompted the new interpretation of federal law? CSIG/Sheldon Adelson ties?
(26:52) Enforcement guidelines from DOJ Organized Crime and Gang Section have yet to be released
(29:25) How might the new opinion impact regulated online poker, casino and lottery games?

Jeff Ifrah NAGRA Webinar

Jeff Ifrah (Founder, Ifrah Law)

(30:30) Distinction between “interstate” and “intrastate”
(32:30) Prosecutions, crackdowns and enforcement are at sole discretion of USDOJ
(32:43) New Wire Act interpretation places shared liquidity U.S. online poker under threat
(33:32) New interpretation’s possible impact on “progressive” land-based casino prizes
(34:00) Payment processing and other facets connected to wagers tend to cross state (or country) borders
(35:15) New opinion could have “far-reaching” consequences both land-based casinos and online sites
(35:43) Legal path forward, various related government and lobbyist actions

(38:51) Concerns regarding how new opinion may affect payment processing
(40:53) New Hampshire Lottery Commission files suit against DOJ
(41:41) Lotteries are already regulated under U.S. Code Title 18, Chapter 61
(43:11) Intermediate routing: backup servers for iGaming/lotteries are often located in separate states
(44:04) NeoPollard Interactive lawsuit against DOJ
(45:16) Declaratory judgments, injunctive relief, and proving irreparable harm are “uphill” battles
(47:17) George Rover believes there will be a “stay” of the new Wire Act opinion
(47:40) More on New Hampshire lawsuit, precedent, and potential future litigation regarding new opinion
(50:16) Who should regulate gambling? Individual states or the federal government?
(51:38) George Rover criticizes new DOJ-OLC opinion and the way it was drafted
(52:22) Critical impact of new opinion on statewide social funding derived from gambling
(53:55) Could gambling receive “non-enforcement” consideration as a vice?
(54:35) Negative economic impact of new Wire Act opinion
(56:26) NAGRA Webinar wrap-up, conclusion
(59:02) END —>

Post NAGRA Webinar Social Media Communication (iDEA Growth/Poker Alliance)

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