U.S. Attorney general nominee Jeff Sessions dropped a bombshell on the fledgling online gambling industry in the U.S. when he said he was “shocked” by a 2011 opinion by the Department of Justice that allowed intra-state online gambling.
Sessions made the statements during his confirmation hearing last week after a question from Senator Lindsey Graham, who has introduced the Restore America’s Wire Act (RAWA) to Congress, which would ban online gambling.
The DOJ opinion held that the 1961 federal Wire Act did not apply to online gaming and only applied to interstate sports betting. That opinion cleared the way for three states—Delaware, New Jersey and Nevada—to implement online gambling within their borders. Several other states have instituted online lottery wagering, and others are considering it.
“I did oppose the DOJ ruling when it happened, and it seemed to me to be unusual,” sessions said. “I would revisit it or make a decision about it based on careful study. I haven’t gone that far to give you an opinion today.”
The comment sent shock waves of its own through iGaming advocates. Though Sessions did not indicate how much of a priority revisiting the ruling would be, Las Vegas Sands owner Sheldon Adelson has been the main force behind Graham’s bill and efforts to ban online gambling. Analysts note that Adelson is a major backer of Republicans—who now control Congress. While he supported President-elect Donald Trump, it wasn’t close to the effort he put in to elect Mitt Romney four years ago.
The lobbying group Poker Players Alliance said a new ruling by the DOJ could act as its own ban on online gambling.
“A reversal of the Wire Act decision would be a radical departure from the precedent given to the independent and legally based opinions generated by DOJ’s Office of Legal Counsel,” John Pappas, executive director of the PPA said in a statement. “We trust that he adheres to the longstanding practice of giving ‘great weight to any relevant past opinions’ when he reviews OLC’s 2011 position with regard to the Wire Act.”
Other responses included David Williams, president of the Taxpayers Protection Alliance—which supports individual states rights to determine gambling issues—who noted that that Sessions supported efforts in the 1990s nineties to crack down on internet gambling, but Sessions has not openly backed RAWA.
“There was an opportunity to jump on that bandwagon and he didn’t,” he told yogonet.com
Michelle Minton Consumer Policy Fellow at the Competitive Enterprise Institute, which opposes RAWA. However, said Sessions brief comments were troubling.
“He says he opposed the original memo, and then he said he needed to study the issue thoroughly before making a decision,” she told Yogonet. “But that he already opposed something—he didn’t study it—makes me feel like his mind is already made up.”
If Sessions’ DOJ reverses the opinion, the move would probably result in a series of lawsuits against and by states that allow online gambling and would likely have to be settled by the Supreme Court, she said.
Meanwhile, the American Gaming Association sent a letter to members of the U.S. Senate Judiciary Committee urging a “different approach” to combat illegal gambling, targeting mainly illegal sports betting.
It’s the organization’s latest appeal for the new Congress to repeal the Professional and Amateur Sports Protection Act (PASPA), currently before the U.S. Supreme Court in the form o a challenge from the state of New Jersey. AGA has spent the past few years lobbying for a repeal of the sports-betting ban.
“Instead of restricting betting, the federal ban has only fueled a growing $150 billion illegal market with no consumer protections, no tax benefits for communities and no safeguards for sport integrity,” AGA President and CEO Freeman wrote in the letter. “The past 25 years and society’s evolving attitudes have proven that enforcement is very unlikely to work, which is why we are focused on regulation—which the incoming president appears to support.
“The next attorney general will be forced to use limited resources in the most effective manner,” Freeman said. “We encourage a new legal approach that would dramatically reduce the illegal sports betting market and allow law enforcement at every level to focus on other pressing matters. In the meantime, continued vigilance, focus and resources are required to combat other forms of illegal gambling and, until the federal ban is lifted, illicit sports betting.”
