Justice Dept. Seizes Online Gambling Domains in Shameful “Black Friday” Stunt

Justice Dept. Seizes Online Gambling Domains in Shameful “Black Friday” Stunt

Government Persecution of Legitimate Websites Draws Criticism from Watchdog Group
April 19, 2011

Washington, D.C., April 19, 2011 — Last Friday, a day now called “Black Friday” by online poker players, the U.S. Department of Justice unsealed an indictment against the founders of the three most popular online gambling platforms, seizing their domain names, freezing accounts, and shutting them down.

As a result, American gamblers were left without a legitimate place to bet online and left wondering if they will ever see the huge sums of money they have in accounts tied to the now frozen websites.

“The actions taken by the DOJ toward the online gambling community are a gross overstep of government action and a violation of Americans’ rights to freely spend their money and time how they choose online,” said Michelle Minton, a policy analyst with the Competitive Enterprise Institute.

Online wagering in the United States is not illegal, but current law, the Unlawful Internet Gambling Enforcement Act (UIGEA), creates an onerous and confusing environment that makes processing funds related to Internet gambling activity risky for banks. To avoid the risk of aiding illegal activity, many banks and credit card companies block any payment related to online gambling, lawful or otherwise. The DOJ is going after the sites that attempted to navigate through these regulations and to continue offering services for willing customers in the U.S.  

Current law forces online gamblers and the companies who service them, to operate “underground.” This is something Michelle Minton has been saying since the UIGEA was passed in a midnight vote.

“In this country the question of gambling has been settled. Most states allow some form of gambling, including state lotteries. People can’t understand why playing poker should be any different. They clearly want to play online and no prohibition is going to stop that; it will only force them to engage in riskier behavior and give them nowhere to turn when their rights are actually violated,” said Minton.
 
Minton also sees the possibility for a darker motive in the DOJ’s choice of whom to prosecute— money. The indictment asks for $3 billion in compensation. The money would go from willing gamblers straight to the government’s pocket.
 
“While some of those in the indictment may have engaged in unlawful activity, they are doing so because they want to offer a service that Americans clearly want; what sense does it make that the current laws turn these businesses and customers into criminals? Online gambling, whether it is poker or a game of chance, is voluntary and we ought to have the right to engage in any voluntary activity so long as it isn’t violating another person’s rights,” Minton said.

- Read more on Internet gambling policy at Openmarket.org.

- See CEI's Agenda for Congress: Let Market Forces Regulate Internet Gambling.