Last week in California, the talk over two major topics heated up even further. And neither one of them revolves around the actual drought that the state is experiencing. The August 31 deadline for the passage of some form of online poker bill in California is little more than one month away, and the discussions surrounding bill requirements seems to be pushing any possibilities of a concrete bill even further behind. Horse tracks want a piece of the online poker pie, and according to the Poker Players Alliance, lobbyists for those establishments could be the ones who hold up the bill indefinitely. While everyone else is talking about the bad actor clause, horse tracks could be the ones leading the charge to stop the bill, right out of the gate. Meanwhile, Santa Ysabel and its PrivateTable.com real-money online poker site still insists it will launch regardless of said bill. With lawyers on their side, the company is standing by its view that the site is legal and doesnt need no stinkin authority to operate. But will they put their money where their opinions are? Giddyup, Online Poker The bad actor clause has been at the center of most discussions regarding the possibility of passing an online poker bill in California. Last week, a group of 25 card rooms penned a letter to State Senator Lou Correa to indicate that their participation in any online poker regime is necessary in order for them to support the cause. Most recently, the horse racing tracks of the state are speaking up. PokerNews spoke to PPA Executive Director John Pappas after the GiGse conference, and he chimed with his impressions. He sees some middle ground on the bad actor clause, and he feels that differences can be resolved. Pappas said that a representative of the horse tracks spoke at GiGse and said that any bill that excludes them from the regulated online poker industry is wholly unacceptable. The representative made it clear that they still have powerful allies in the Assembly and Senate. Meanwhile, tribal representatives, such as those involved with the tribal alliance that includes the 13 powerful tribes with major influence over online poker in the state, have noted that they will not accept the participation of horse tracks in the new industry. There may be too many horses on the track for a race to happen at this point. Even if the bad actor clause isnt the impediment that it once was, the road is still not smooth. If New Jersey allows PokerStars into its online poker setup, it may change the minds of some lawmakers in California. But the tribes remain firm on the exclusion of PokerStars, and the now-added friction between tribes and horse tracks may be too much for the debate to handle. Pappas seemed to think that there is simply no interest in overcoming all of the obstacles this year. I think the prevailing concern is that some of these tribes arent really interested in getting a bill done this year, he told PokerNews, and that some of the lawmakers would like to see it delayed as well. Theyd like to push it off another year to build alliances, fundraise, and kind of assess the situation as it develops in other states and with the federal government. He may be right. With just one month to go and no hearings on the Assembly or Senate schedule, as well as the state legislature on recess until August 4, the momentum for California online poker has slowed tremendously. It may be stopped altogether for 2014. PrivateTable Assertions Could Be Tested If no online poker bill passes in 2014, the promise of the Iipay Nation of Santa Ysabel to launch real-money online poker on PrivateTable.com could be put to the ultimate test. The site was supposed to launch in July but has yet to do so. The tribe has been working with California legislators to enact online poker legislation in 2014, but the aforementioned reasons may keep it from happening. PrivateTable may need to put its real-money gaming where its mouth is and launch. Santa Ysabel Interactive President and Casino General Manager David Chelette has repeatedly asserted that the online poker website does not violate any laws. But in a recent interview with Online Poker Report, Chelette noted that the tribes primary goal is to work with legislators and be included, along with other small tribes, in any legislation that moves forward. PrivateTable is ready for launch, with servers established and set up in the Mohawk Territory of Kahnawake and an inter-jurisdictional license from the Kahnawake Gaming Commission. Secondary servers are actually located on the Iipay Nations tribal reservation. The site itself is operated by Santa Ysabel Interactive and regulated by the Santa Ysabel Gaming Commission. For now, Chelette asserts that PrivateTable is designed and implemented to be in compliance with current federal law and California state law. Gaming attorneys have been chiming in on the situation and seem to feel that Santa Ysabel is well within its rights as a tribal entity to operate online poker in California without the formality of a new online poker law. Casino City Times interviewed Martin Owens, a gaming attorney who works on behalf of Santa Ysabel, and he noted that the servers being located on Native American land puts the tribe in full compliance with California law. He claimed that online poker falls under the Class II category of gaming in the Indian Gaming Regulatory Act (IGRA), which doesnt require the consultation of any state authority for operation of the activity. In addition, Owens contended that Santa Ysabel and California signed a Class III gaming compact in 2005, which authorizes the tribe to offer gaming. Now, its PrivateTables turn to act. Are they confident enough in their arguments and legal research to launch the site and begin accepting real-money wagers for online poker play in California? All eyes are on one tribe in California to see if they do it. Previous Post Next Post pokerstars|private table|santa ysabel About Jennifer Newell Jennifer has been writing about poker for nearly a decade, including extensive work as a freelancer, where Jennifer has worked for numerous gaming-related websites, magazines, and blogs with a focus on players, news, and interesting stories. Follow Jennifer on Google+ and Twitter.
On Wednesday, the US Senate Committee on Indian Affairs hosted an oversight hearing on Indian Gaming called: The Next 25 Years. But as one respondent on Twitter exclaimed, they should have called it The Past 25 Years. What was billed as A Committee oversight hearing on the state of Indian gaming, the hearing turned out to be almost entirely focused on restricting new gaming development and a single piece of legislation HR 1410, the Keep Promise Act, which calls for the prohibition of Class II and Class III gambling in Phoenix, Arizona on land acquired after April 9, 2013. When not speaking directly on HR 1410, the two hour hearing was little more than a chance for certain senators to make the case for tribes or Indian gaming in their jurisdictions, while the speakers spent most of the time doing likewise, either airing grievances or lobbying for this or that from the government. There were plenty of mentions of the stagnation in Indian gaming revenue (one speaker cited the figures as $28 billion in 2013 and $27.9 Billion in 2012) while commercial gaming continues to grow. Solutions like less regulation and making sure the tribes maintain their monopolies were mentioned, the most obvious solution, expansion into online gambling was never brought up, even in passing. Its not as if the speakers or a senator would be out of place bringing up online gambling, considering the current atmosphere, with the Santa Ysabel tribe in California threatening to upset the apple cart and launch an online poker site under the auspices of Class II Gambling. In my opinion, the committee should have at least acknowledged this new challenge to the current status quo, as it could lead to a complete overhaul of the Indian Gaming Regulatory Act (IGRA) which is celebrating its 25th anniversary. Instead we once again heard all of the old solutions such as licensing issues, commercial casinos encroaching on their territory, and tax burdens. There simply was no vision towards the future in a hearing that was billed as such, or at least towards a realistic future that will obviously include online gambling. Instead it was more of the same, and the same concerns and solutions of the past 25 years appear to be following us into the next 25 years. As one speaker, Anne-Marie Fennell, noted there are 420 tribal gaming establishments spread across the United States. But more casinos are not the answer, neither are other 1980s solutions. We are in 2014 and need solutions that reflect the current technological advances the world has seen. Yet all the talk was more of the same, as commercial casinos in Arizona and Montana were spoken of ad nauseam, with no mention of online gambling possibly offering a way to offset the stagnant revenues tribes are experiencing, or offsetting the new competition these casinos will provide. Small tribes in remote places Perhaps the most troubling part of Indian Gaming is how it favors certain tribes. Roughly 43% of the nations Indian tribes are involved in gaming (not all successfully mind you), and it has brought in plenty of revenue for a number of these tribes. But what about the tribes in far-flung locations, or the tribes that simply dont have the means to build casinos? A. T. Stafne, the Chairman of the Assiniboine and Sioux Tribes of Fort Peck, basically made the case for online gambling without even realizing it, when he stated, Online gambling would tear down these geographical barriers, and yet it was never mentioned. These tribes would have a chance to share in the gaming pie, or at the very least create some type of revenue sharing agreement with gaming tribes as is currently the case in California. As important as Im sure HR 1410 is, or Diane Feinsteins S 477, there is an elephant in the room and nobody seems to want to acknowledge on the federal level. The point is, all tribes could potentially benefit from online gambling regardless of their location. If tribes sit on the sidelines while online gambling proliferates its only going to make matters worse. Stagnation may be the least of their problems if this comes to pass. For those of you interested, this is the composition of the Senate Committee on Indian Affairs: Jon Tester, Chairman (MT) Maria Cantwell, Member (WA) Tim Johnson, Member (SD) Tom Udall, Member (NM) Al Franken, Member (MN) Mark Begich, Member (AK) Brian Schatz, Member (HI) Heidi Heitkamp, Member (ND) REPUBLICANS John Barrasso, Vice Chairman (WY) John McCain, Member (AZ) Lisa Murkowski, Member (AK) John Hoeven, Member (ND) Michael Crapo, Member (ID) Deb Fischer, Member (NE) Previous Post Next Post About Steve Ruddock Steve Ruddock is a longtime member of the online gambling industry. He covers the regulated US online casino and poker industries for variety of publications, including OnlinePokerReport.com, PlayNJ.com, USPoker.com, and USA Today.
Last week the San Francisco Hyatt Regency was the home of one of the biggest iGaming conferences on the calendar each and every year, GiGse Totally Gaming. GiGse is a place for vendors, analysts, commentators, and insiders to come together and talk shop, show off their products, and try to get a handle on the latest industry trends, and this time around a lot of the proceedings and talk at the iGaming conference / supershow centered around the ongoing online gambling legislative debate happening in the US, with a specific emphasis on California. Among the speakers were several prominent former and current politicians, including one of Sheldon Adelsons latest hired guns, former San Francisco Mayor Willie Brown. Brown struggled in his first public appearance as a part of Adelsons Coalition to Stop Internet Gambling (CSIG) after flip-flopping on the issue (something Brown admitted to at GiGse) when he debated former Pennsylvania Governor Ed Rendell and moderated by former Nevada Governor Bob Miller on Day 1 of GiGse. Rendell came across as pragmatic and knowledgeable on the issues of gambling and online gambling, which shouldnt be surprising considering he oversaw Pennsylvanias expansion into casino gambling during his time in office. Rendell was on point throughout the debate and emerged from GiGse as a breakout star of sorts in the iGaming world: Brown, well, not so much. Problem #1: The children! Brown made several easily disprovable statements during the debate, including the absurd statement that its not possible to reliably verify an online gamblers identity I wonder how many Brick & Mortar casinos Mayor Brown has entered that require a player to surrender their Social Security Number and submit to a player verification before they are even allowed to walk through door? This argument has proven to be a dead end as there is simply no way to guarantee anything 100%, which seems to be the threshold Adelson and his cronies expect iGaming to meet. Former Pennsylvania Governor Ed Rendell (Browns foil in the debate) dismissed this idea of underage gamblers, noting that not only are their safeguards in place, but children using their parents credit cards will be caught by wait for it the parents, who Rendell called, the best regulators of all. Problem #2: There are cannibals in the internets tubes Underage gambling wasnt Browns only problematic, as the second eye-rolling comment he made was in regards to the effect of online gambling on land-based casinos, an area of knowledge where he seems entirely in over his head. According to Brown, who recently went to Las Vegas and had a great time (dont just love non sequiturs?), online gamblers engage in Internet gambling singlehandedly by which I think he meant to convey they dont go to land-based casinos, and since online is an option all land-based gamblers would cease going, and this would cost the land-based casino industry jobs. Perhaps Mayor Brown would like to take a look at the data from Caesars and the Borgata in New Jersey which shows the overwhelming majority of their online gamblers are new to their rolls. Caesars stated 91% of its online players are new players (also known as new customers) and the Borgata has stated that 80% of their online players were not rated in the previous two years. This argument is along the lines of McDonalds not offering French fries because it might cut into their burger sales. Apparently Mayor Brown doesnt think casinos should expand their customer base. Problem #3: Resurrecting old talking points Perhaps Mayor Brown was handed an old copy of the Adelson talking points, considering he tried to resurrect the tired argument of money laundering being easier online; an argument that has been debunked to the point that people spouting off in this manner are roundly snickered at. Browns money laundering nonsense charge was easily refuted when former Nevada Governor Bob Miller (the debate moderator) explained to Mayor Brown that money laundering on the Internet is easier to trace and most money launderers like to deal in cash as far as one knows, you cant put cash into your laptop and turn it into virtual currency. Mayor Brown and anyone else taking up this line: No matter what you do online there is a record of it. Problem #4: Off the rails Welcome to the Off The Rails segment! This is beginning to become a theme amongst Adelsons henchmen, and one people look forward to at every hearing and conference. Basically, the longer they are allowed to talk the wackier their comments become until they eventually go completely off the rails, and say something that is so patently absurd you cant take them seriously or, even more comically, make the case for regulation better than pro online gambling advocates. A terrific example of this was Andy Abboud telling Pennsylvania lawmakers that since there hasnt been a documented case of underage gambling in Nevada, New Jersey, or Delaware that is proof that its going on. Abboud finding the smoking gun on underage gambling was perhaps one of the biggest missteps in the short history of these conferences. But Brown seems set on beating Abboud in the off the rails comments. Reminiscent of Sarah Palins Going Rogue comments (Palin is still the all-time champion off the talk until you go off the rails crowd) Willie Brown, representing Sheldon Adelson who is pushing for a federal ban of online gambling, somehow started advocating for federal legislation regulating online gambling towards the end of the debate. Previous Post Next Post About Steve Ruddock Steve Ruddock is a longtime member of the online gambling industry. He covers the regulated US online casino and poker industries for variety of publications, including OnlinePokerReport.com, PlayNJ.com, USPoker.com, and USA Today.
So its Tuesday, and with each passing day Im more and more convinced that the Santa Ysabels promise of launching a real-money online poker site in California was just a ploy to get lawmakers and industry experts talking about the issues that face the states smaller tribes. Well played, Santa Ysabel. Well played. Since the Santa Ysabels announcement last week, several debates have propped up, most of them revolving around whether the tribe is within their right to generate revenue from an unlicensed site. To recap:
According to the Santa Ysabel, the Indian Gaming Regulatory Act of 1988 categorizes poker as Class II gambling. As such, the tribes representatives believe that by generating revenue via online poker, they would not be in violation of the law. However, the Act makes no specific mention of poker, only of non-banked games.
The bigger issue is that the IGRA does not define legal parameters for games that are based in tribal lands but played from outside the hosts confines (i.e. servers housed in Santa Ysabel lands but accessible to anyone in California).
The parties behind Santa Ysabels real-money poker site, namely the Kahnawake Gaming Commission, Financial Payment Network and the Santa Ysabel themselves, would all have their suitability questioned by any legitimate gaming commission. Should sovereign nations have the right to just let anyone, regardless of worthiness, back into the United States? Underlying these more immediate issues, is one that could affect the landscape of Californias iGaming industry for years to come, and thats whether or not tribes should be required to pay what will probably amount to a $5 $10 mm iGaming licensing fee, and if they are, should the tribes that cant afford it be entitled to a revenue share, similar to the existing Revenue Sharing Trust Fund. In all likelihood, its this debate that the Santa Ysabel hoped to spark when they made their surprise announcement. And to that end, they have succeeded. Again, well played. Breaking the California debate down Colleague Steve Ruddock nicely sums up the arguments for a new revenue sharing agreement in his recent post, and for the most part I agree. Steve would then expand upon his argument in an exchange on Twitter. Lets break it down: The concept of a network where small tribes are permitted to leech off larger ones is an interesting proposal, yet could only function if the licensing fee were drastically lowered or removed entirely. Furthermore, the network model comes with its own share of issues. First off, those likely to set up shop in CA (PokerStars, FTP, Party and to an extent 888) function primarily as standalone sites. Assuming online pokers big guns will latch on to the states largest tribes and cardrooms, the small tribes will be left scrambling to forge their own network a network that would probably feature substandard software, poor organization and little free-flowing capital. It wouldnt stand a chance, and could actually cost the tribes more money than their real-money poker offering would generate. Admittedly, thats a pessimistic outlook, but its also a likely one. More rooms DOES NOT equate to equivalent revenue. By fracturing an online poker community, each individual site has less power to offer more attractive promotions, better tournament guarantees and more cash-game / SNG playing options. In turn, would-be players looking for value may opt out entirely. Look at it this way, does anyone really think that the combined revenue of Party / Borgata, WSOP and 888 in New Jersey would exceed that of PokerStars if Stars were the only operator in the state? No shot. Regarding Steves point, it would certainly be easier just to give the smaller tribes a kickback. The odds of a solitary small tribe, even if it were part of a network, generating more revenue from online poker than any reasonable stipend would provide them is so minuscule that it can be discounted. That, and they wouldnt have to work to earn their share. That, and it allows tribes like the Santa Ysabel to reliability pay off their existing debts. That, and its better for the poker community. And so on. Im hard pressed to believe that any small tribe would have the resources to launch much of a marketing campaign. One neednt look much further than New Jersey to see what good a half-baked marketing roll-out does for traffic. Compounding matters further, its already been proven that theres little demographic overlap between b&m casino patrons and online gamblers. If smaller tribes attempt to market their b&m casinos through advertising its online poker site, theyll end up broke and scratching their heads. Again, Steve is right: But maybe theres a way around that An alternative approach? What our new friend PokerXanadu is suggesting is that we keep the proposed $5 $10 mm licensing fee in place, toss in a revenue sharing model for smaller tribes and allow them to operate real-money poker sites. Thats sounds like a fair compromise, except that for such a system to work the unlicensed tribes would have to be subject to the same regulatory confines as the licensed ones. Otherwise, some of them would run afoul, greeting every shady partner with a wink and a handshake, much like the Santa Ysabel. And again, would these rooms actually be able to turn a profit? In business, for every potential upside there is a downside. The downside potential of a heavily marketed poker skin that fails miserably would be hefty enough to consume the tribes revenue share and more. What about nixing the licensing fee entirely? That way, tribes would be free to pursue their own iGaming interests without having to first prove that they could ante up at least $5 mm. Alright, sounds great, but if given the choice of aligning with the Pechanga or Joes Tribe who is Party or 888 going to prefer? Theyre going to preference tribes with strong b&m casino interests and more importantly, money. Any tribe that currently receives a revenue share can only host a maximum of 350 gaming machines hardly enough to entice online gamings big guns. On the plus side, sans a licensing fee, the mid-sized operations would have more money to spend on marketing, promotions and welcome bonuses. And lets face it, if PokerStars is part of the scene, its competition will need all the help it can get. The answer for Cali iGaming is ? So to conclude, while on paper ditching the licensing fee appears to help smaller tribes, it would benefit the 888s and Partys of the world significantly more (at the expense of the state). By contrast, a revenue sharing program would allow smaller tribes to build value and eliminate debt. And despite my points to the contrary, Im generally in favor of sites being allowed to conduct their own operations, in so long as the conditions in which they are permitted to do so are air tight. Just dont say I didnt warn you if your operation fails. Previous Post Next Post 888 poker|party poker|pechanga|pokerstars|santa ysabel About Robert DellaFave Robert DellaFave writes for a variety of online gaming sites and is also working on programming a poker simulation creative enough to beat the best. Follow Robert on Twitter @DivergentGames and on Google+
Any debate on any topic should welcome all pertinent voices into the fold. Generally speaking, more points of view will lead to a fuller discussion of the topic and a well-rounded solution. Such is the case for California online poker. The GiGse Totally Gaming conference was held this week in San Francisco and highlighted many voices in the online poker debate. Some, like Former Pennsylvania Governor Ed Rendell, expressed a very pro-online gaming stance, while Former San Francisco Mayor Willie Brown spewed so many contradictory points of view that he likely confused even himself. Meanwhile, a California tribe tried to go rogue and launch its own real-money online poker site, the California gaming regulator finally chimed in to the broader online gaming debate, and a group of card rooms expressed their views regarding online poker. For a state that has yet to regulate online poker, California was quite busy with the subject matter this week. Can Someone Paraphrase Willie Brown? Most people who spoke at GiGse this week in San Francisco had fairly firm ideas of where they stood on the Internet gaming issue. Mr. Willie Brown, on the other hand, seemed to confuse himself the more he spoke. Brown did admit that he has switched sides on the Internet gaming issue a number of times during his 15 years as California State Assembly Speaker, but he has settled on the Sheldon Adelson side of the issue since his retirement. However, he seemed to lack basic knowledge of the industry, stating that online gamblers identities cant be reliably verified and children cant be kept off the gambling sites because they have the skills of computer hackers. He went on to assert that people in land-based casinos would lose their jobs and criminals could launder money through the Internet gambling sphere. And then, Brown added that Internet gaming should be regulated by the federal government. Ed Rendell took the other side of the argument at the conference, discussing tax revenues that will help address addiction problems and actually help land-based casinos in states like Pennsylvania. He asserted that gambling creates jobs and states must legalize online gambling to secure those jobs. Gambling exists, he said. Pennsylvania should have its share. Santa Ysabel Dont Need No Stinkin Bill The Iipay Nation of Santa Ysabel in California is not the largest tribal nation in the state, but it sure made a splash in the news this week. They launched PrivateTable.com, an online poker room that was prepared to offer real-money games for California residents. The tribe asserted that tribal sovereignty gave it the authorization to operate as noted in the federal Indian Gaming Regulatory Act, and more specifically as referenced in the compact between Indian tribes and the state of California passed in 2003. Under the oversight of the Santa Ysabel Gaming Commission, the site was deemed legal. Going even further, the tribe noted that other forms of online gambling were in the works as well. The press release announcing the site noted that Santa Ysabel Interactive partnered with the Kahnawake Gaming Commission, the famed regulator that delayed and (some say) botched the investigation into the Ultimate Bet scandal years ago. Santa Ysabel, however, regarded the KGC as the gold standard of interactive gaming regulation that has shown uncompromising integrity in I-gaming hosting. The site used the same software as the Winning Poker Network and offered play-money games immediately after the notice. Most players within the state said that real-money games never materialized throughout the week. What is the plan? Only the tribe knows, apparently. Head of GCC Speaks Richard Schuetz is the Commissioner of the California Gambling Control Commission, the regulatory body that remained silent as the above-mentioned tribe promised to launch online poker in the state in the absence of any state bill authorizing such a move. But he did write an editorial piece for GiGse about the general state of online poker in the United States. Among his points was the notion that regulating online poker by state will create complications for which there will be no easy fix. With that in mind, he pleaded with those pushing for regulation in the gaming industry to work with regulatory organizations and legislators to push for harmonized platforms so that states may eventually work together without too many inconsistencies to get in the way. Schuetz then disappeared behind the curtain in a puff of smoke. Card Rooms Want More Say in Online Poker Debate The only card rooms that have been at the forefront of the online poker debate in California thus far are the ones partnered with PokerStars and the Morongo Band of Mission Indians. Those facilities were Commerce Casino, the Bicycle Club, and Hawaiian Gardens Casino. Another 25 of the card rooms decided they wanted a voice in the game as well. A total of 25 of them, including Hustler Casino and Hollywood Park, sent a letter for State Senator Lou Correa, one of the sponsors of pending online poker legislation in California.They noted that they wanted to participate in online poker, should it be legalized, but feared being left out because of the size of their rooms and the partnerships already being formed. The coalition of rooms also stated that they supported a bad actor clause in any legislation, which put them in line with the majority of the vocal Indian tribes in the state in wanting to keep Rational Group companies out of the game. In essence, the card rooms want to be included in the discussions and play a role in developing final online poker legislation for California to protect our existing poker business, jobs, and tax base. The letter went further to say, Legislation that pretends to include card rooms but handicaps or otherwise restricts their effective participation is not good policy. With little more than a month before the August 31 deadline for an online poker bill to move forward in the state before being tabled until 2015, more voices in the debate makes it less likely that anything will materialize in 2014. Previous Post Next Post bike|commerce|hawaiian gardens|iipay nation|morongo|pokerstars|santa ysabel About Jennifer Newell Jennifer has been writing about poker for nearly a decade, including extensive work as a freelancer, where Jennifer has worked for numerous gaming-related websites, magazines, and blogs with a focus on players, news, and interesting stories. Follow Jennifer on Google+ and Twitter.
On Sunday, Marco Valerio broke the news that the 300-member Iipay Nation of Santa Ysabel tribe is planning to launch a real-money online poker site as early as next week. The original announcement was made via press release, in which the tribes Commission Chairman David Vialpando justified the move by stating that the Santa Ysabel were exerting its sovereign right under the Indian Gaming Regulatory Act to regulate and conduct Class II gaming from the tribes reservation. While most table games are considered Class III, poker which is a non-house banked game falls under Class II. As of now, Santa Ysabels PrivateTable.com, which utilizes the same software as U.S-facing offshore network WPN, is offering players access to a play money version of the software. In short, PrivateTable.com is up, its running and it at least looks real. Yet, given the Santa Ysabels shaky history in the casino industry, the current condition of the software and the inevitable legal implications it would face by going rogue, Im just as inclined to believe that Santa Ysabels foray into the online gaming biz is more an elaborate ruse to satisfy its own interests, or at best a move to facilitate the passage of one of the states existing iGaming bills, than it is a(n) (il)legitimate attempt to generate long-term revenue as an independent online poker company. Who is Santa Ysabel? A post by PokerXanadu on the Two Plus Two forums, sums up Santa Ysabel previous dealings in the casino industry quite sufficiently: A few points of clarification: The casino that PokerXanadu is referring to was The Santa Ysabel Casino, which opened in 2007 and closed this past February. The tribe cited local governments unwillingness to renegotiate its financial agreement with the Tribe in the face of economic hardship as one of the primary reasons behind the closure a claim which County Supervisor Dianne Jacobs called absurd. Santa Ysabel Casinos closing left the tribe tens-of-millions of dollars in debt, with little means to pay it off. An attempt to declare chapter 11 bankruptcy prior to the closure was denied by the court. Point number two: Despite its assertions, the legality of the Santa Ysabel launching a casino with servers based on its grounds is questionable at best. The Indian Gaming Regulatory Act does not address Internet gambling, suggesting that it would have to be amended before the Santa Ysabel could roll out their operation. Along the same lines, while sovereign nations are more than permitted to accept real-money wagers within their lands, some legal experts believe that limitations in tribal-state regulatory compacts and provisions in the Indian Gaming Regulatory Act (IGRA) limit the ability of tribes to accept wagers from off Indian lands. This according to an email from LA-based gaming lawyer sent to industry expert Chris Grove. The obvious point of contention here is that the Santa Ysabel are readying to offer all California natives access to its real-money poker site, not just those geo-located within the reservations boundaries. In short, even though there is no specific language necessarily prohibiting the Santa Ysabel from conducting iGaming operations, theres no clause allowing it either. Moving on, the payment processor mentioned is the Financial Payment Network, a company no one has ever heard of and which features a website that is currently under construction. Enough said. And finally, the Kahnawakee Gaming Commission, which acted/acts as the regulatory committee for just about every online poker site that operated in the United States despite being in violation of the UIGEA, was in fact likely involved in the super user scandal that saw Absolute Poker and Ultimate Bet steal millions from its customers. Given this, its hard to place any weight into Santa Ysabels claims that itll be launching a real-money poker site that abides by a similar set of regulations to those set forth by Delawares regulatory committee by next weekend. And I have to think that on some level, the Santa Ysabel realizes this too. Either that or its level of ignorance is unfathomable. So whats really going on? A few possibilities:
PrivateTable.com is a shady attempt by a desperate tribe to generate some sort of short-term revenue. Given the aforementioned legal murkiness of Santa Ysabels supposed real-money online poker site, its probably only a matter of time before the tribe would find themselves embroiled in a legal battle. But until then, the tribe will be happy to generate whatever income it can. Should this be true, the Santa Ysabel will endanger the future prosperity of the US regulated market, and give iGaming opponents just another reason to oppose its expansion all in the name of its own preservation. Way to go Santa Ysabel.
The whole thing is a ruse. Californias smaller tribes, especially those facing debt, will hardly be able to prove that they can pay a $5 million deposit. Recognizing this, the Santa Ysabel threaten to launch its own site, and encourage other sovereign nations to the same, in the hopes that the licensing requirements are relaxed. The Santa Ysabels poker offering is so grossly in violation of everything the regulated markets stands for (identification verification, strong authentication, responsible gambling etc.) that the proposed bills are amended as to be more amenable to smaller tribes. Admittedly, this theory is a bit of a stretch, but the idea that the Santa Ysabel are merely posturing is not.
The Santa Ysabel are doing this to facilitate the passage of an iGaming bill. Likely not, if only because government and the states most influential tribal factions are already in favor of iGaming legislation, with the bad actor language the only true dividing point. At best, Santa Ysabels announcement may encourage the Morongo and the states other tribes to settle their differences before other tribes go rogue. But even if the Santa Ysabel manages to launch its site by next week, its chances of drawing a significant user base are so low that it will likely not instill lawmakers with any sense of urgency. More to the point, how would the faster passage of an iGaming bill necessarily help the Santa Ysabel? Short answer: it wouldnt. But it may spark a legal conflict that eventually sees sovereign nations gain the right to legally offer online poker, and that could certainly benefit the Santa Ysabel, as it would position itself as the pioneer of an alternative gaming market. Who knows, maybe by then the tribe would be in a position to host you know, a credible site. In either case, heres a warning to California poker players: Dont play on PrivateTable.com especially if it launches under the current conditions. Previous Post Next Post private table|santa ysabel About Robert DellaFave Robert DellaFave writes for a variety of online gaming sites and is also working on programming a poker simulation creative enough to beat the best. Follow Robert on Twitter @DivergentGames and on Google+
As California continues to work towards legalizing and regulating online poker there have been a number of problems, disagreements, and hurdles that have needed to be overcome; at times it seems as if they are encountering new obstacles faster than they can solve the old ones. The latest issue being the Santa Ysabel tribes decision to go it alone and offer online poker, citing their belief that online poker falls under the Class II Gambling designation in the 1988 Indian Gaming Regulatory Act (IGRA) and is therefore perfectly legal for the tribe to offer on their own volition. The Santa Ysabels threatened launch of an online poker room without any type of legislation being passed has led to a number of arguments dealing with everything from Class II Gambling needing to be redefined by Congress, to the suitability of entities that are supposedly assisting Santa Ysabel in their online endeavors. However, there is also a very applicable issue that needs to be addressed in what the Santa Ysabel Indians are trying here: The need for a restructured or new revenue sharing model among California tribes. The Current System Under the current agreement tribes with more than 350 gaming machines / devices set money aside with the state gaming commission in what is known as the Revenue Sharing Trust Fund (RSTF). This money is then doled out to certain non-gaming tribes and tribes with 350 or fewer gaming devices / machines so if you ever wonder why so many tribes in California have specifically 350 machines and never 351, you now have your answer. Each non-gaming tribe and tribe with under 350 machines (there are a total of 61 tribes that are part of the RSTF either as contributors or beneficiaries) that is part of this agreement receive $1.1 million per year. If youre interested, here is a great overview of the RSTF from the National Law Review website. However, this revenue sharing model is based on Class III Gambling (slot machines, table games and house-banked card-games), which doesnt cover poker revenue, as poker is considered Class II gambling under the Indian Gaming Regulatory Act (IGRA) poker is not specifically mentioned but falls under the non-house-banked card games heading. On the other hand, online poker is currently not classified as either Class II gambling or Class III. In fact its not classified at all. There is an argument to be made that poker is poker, so it should be Class II gambling, but another side argues that the gambling doesnt occur on tribal land (proponents of this argument feel the bet is placed where the player is and not where the internet servers are) so there is still quite a bit of legal gray area that needs to be worked out. Because of this, online poker in California is going to need a new or amended revenue sharing agreement that specifically covers online poker, distinguishing it as either as Class II (and adding this to the revenue sharing agreement) or some other Class of gambling, otherwise smaller tribes will not benefit in any way from the expansion into online poker. Why revenue sharing would help online poker A fair revenue sharing deal in California would achieve several aims: First, it wouldnt put smaller tribes, who are unable to afford the cost of a license (presumably in the $5 million to $10 million range) and unlikely to be capable of raising the capitol needed to create and launch an online poker room, on unequal footing with the larger gaming tribes. And this inequity has not been lost on the smaller tribes, including Santa Ysabel, as the Santa Ysabel Gaming Commission website states: Secondly, it will limit competition to a manageable number of online poker rooms by making it financially beneficial for most tribes to pass on online gambling and instead draw from the revenue sharing trust fund. With smaller tribes benefitting from the success of the larger tribes who do get involved in online poker there is little reason for them to try to launch their own online poker sites. This revenue sharing model has worked well for California in terms of casino gaming and should limit (in a good way) potential competition for Californias still hypothetical online poker industry. Who is for and who is against Revenue Sharing No tribe is publicly against setting up an online poker revenue trust fund, but some tribes have been more vocal about making sure the smaller tribes get their piece of the pie. One of the most vocal is the Morongo Band of Mission Indians, who have stated multiple times that revenue sharing needs to be included in any online poker bill (it currently isnt) if the tribe is going to throw their support behind it of course the Morongos larger issue is the bad actor / tainted asset clauses currently being pushed. Race tracks may need to be cut in as well In addition to the tribal revenue sharing, the current plan includes card rooms that already offer poker and meet certain other criteria, along with tribal casinos that offer poker and meet certain other criteria (read as: have money and political power): Everyone else will be shut out, including small tribes, small card rooms, and race tracks. Race tracks are definitely feeling left out, and they are likely to get even more vocal if smaller tribes are cut in via revenue sharing while the race tracks are left on the side of the road. Race tracks may not be the political power players they use to be, but they do still have some clout and are aligned with labor unions as well, so they are not to be trifled with. Previous Post Next Post morongo|santa ysabel About Steve Ruddock Steve Ruddock is a longtime member of the online gambling industry. He covers the regulated US online casino and poker industries for variety of publications, including OnlinePokerReport.com, PlayNJ.com, USPoker.com, and USA Today.
The Santa Ysabel Band of Diegueño Indians in California (commonly referred to as the Iipay Nation) have decided to give the old Spaceballs salute to the other tribes in California as well as the state legislature and launch their own online poker room even though California has yet to pass online poker legislation. The story was first reported by Marco Valerio who received a copy of a press release (the full press release can be found at the bottom of this article) from Sacramento-based attorney Martin Owens detailing the legal opinion the Iipay Nation feels it is operating under as well as the logistics and regulations that their rogue online poker room will operate on. The poker room goes by the name PrivateTable.com and uses IG Soft software, which is the same software in use at the Winning Poker Network (which operates several unlicensed online poker rooms in the US). The site is live for play-money games as we speak, and could offer real-money games as soon as today assuming this isnt some type of bluff by the Iipay Nation. The tribes decision to make this bold leap seems centered around the capability of offering Class II gambling (peer-to-peer such as poker and bingo) under the Indian Gaming Regulatory Act on the tribes reservation. Well have to see if California agrees. Interestingly, the site will offer real-money games only to California residents located in California, who are over 18 years of age. Some concerns The largest concern I see is a further fracturing of Californias tribes, as the lipay Nation has for lack of a better analogy thrown sugar in the gas tank by saying that there is no need for an online poker bill and tribes can offer online poker legally as the law is now written. Assuming this is not a bluff, Id expect plenty of legal filings in the coming days and weeks. Another serious concern is over the entities involved. The Iipay Nation arent what you would call stellar performers with plenty of legal battles and debts in its past, and they have enlisted the Kahnawake Gaming Commission as their regulators for those that are unaware, the Kahnawakes were the regulators during the Absolute Poker and Ultimate Bet Super User scandals and have licensed many offshore sites illegally operating in the US. Another troubling aspect is the payment processor the tribe has settled on, Financial Payment Network (or FinPay for short) which John Mehaffey researched and found to be a new company with almost no track record to speak of. Comparing the FinPay.net website with the established and licensed Optimal Payments (Neteller) will give you an idea of why this might be a problem. A big picture problem My biggest fear is that this website, which is unlikely to have any type of legitimate player verification system both in terms of geolocation and Know Your Customer checks will be propped up by online gambling opponents as the current state of the technology and the types of safeguards in place. I dont think this site will be good for anyone, not even the Iipay who are likely to get very little traffic from it. Some unanswered questions that could be extremely damaging to online poker expansion are: How many players will register with a false California residence, use a VPN and play on the site? What type of age verification is in place other than checking a box stating you are over 18? In my opinion, this online poker website should be derided by the entire industry as it is not an example of what licensed US online poker should be; in fact it is simply a version of the same unlicensed sites (right down to the software being used) using sketchy regulators located in other countries (the Kahnawake Tribe is located in Canada) who are themselves not accountable to anyone. There is literally not a single entity involved in this endeavor that doesnt have skeletons in their closet: from Iipays, to Kahnawakes, to IG Soft, to FinPay. As promised, here is the full press release: Santa Ysabel Interactive Launches Online Poker Site in California San Diego, California -July 10th, 2014 Santa Ysabel Interactive, an enterprise of the Santa Ysabel Tribal Development Corporation, launched the first legal, tribal regulated interactive poker website from the Tribes reservation located east of San Diego, California. The Tribes I-gaming poker website, PrivateTable.com, accessible to adult California residents who register through the website, will be a legal alternative to the unregulated, illegal Internet-based gambling websites, operated from off-shore locations by operators of questionable character. Were looking forward to the opportunity to expanding upon the lipay Nation of Santa Ysabels successful track record in the regulated gaming industry, commented spokesperson Dave Vialpando. The Gaming Commission has applied its years of experience to ensure the integrity of the games when designing the framework for Santa Ysabel Interactives I-poker website. California Tribes have been actively involved in gaming in the state since the passage of Proposition 1A in 1999. The Iipay Nation of Santa Ysabel successfully negotiated a Tribal-State gaming compact with California in 2003 and operated the Santa Ysabel Casino from the Tribes reservation. The regulatory structure implemented by the Santa Ysabel Gaming Commission is more stringent than the regulatory requirements contained in either of Californias proposed I-gaming legislative proposals currently under consideration by the California Legislature. The Tribe supports the effort by the Legislature to enact interactive gambling legislation in the State, but has decided to rely on the tribal sovereignty and the provisions of the federal Indian Gaming Regulatory Act (IGRA) to offer I-poker from the Tribes reservation, continued Dave Vialpando.Santa Ysabel Interactive currently has no plans to offer Internet-based slot machines or banked-games through its website, PrivateTable.com, but will consider offering other gaming consistent with IGRA. Santa Ysabel Interactive has partnered with the Kahnawake Gaming Commission, establishing an Inter-Jurisdictional Agreement, to host a portion of Santa Ysabels interactive gaming structure within the Mohawk Territory of Kahnawake. The Kahnawake Gaming Commission is recognized internationally as the gold standard of interactive gaming regulation and has demonstrated uncompromising integrity in I-gaming hosting. The Iipay Nation of Santa Ysabel, whose membership has struggled with high unemployment and a lack of economic opportunity, is looking forward to applying the revenues generated from Santa Ysabel Interactive to further the economic goals of the Nation. It is the Tribes goal to increase the standard of living for the Nations members, invest in tribal infrastructure improvements, and achieve economic self-sufficiency through multiple, different and diverse business ventures. It is Santa Ysabel Interactives goal to offer a safe, exciting, and secure quality interactive gaming experience for California adult residents, employing cutting edge technology, customizable to the customers personal preferences. Contact: Dave Vialpando [email protected] PO Box 558 Santa Ysabel CA,92070 USA (619) 888-2536 Photo credit: Marco Valerio via agentmarco.com Previous Post Next Post iipay nation|private table About Steve Ruddock Steve Ruddock is a longtime member of the online gambling industry. He covers the regulated US online casino and poker industries for variety of publications, including OnlinePokerReport.com, PlayNJ.com, USPoker.com, and USA Today.
Another week brings no big news on the California online poker front. Everyone claims to be working toward a solution, but no word from any of the parties involved keeps poker fans, players, and media in limbo. In order to get a true picture of the status of California online poker, one has to read between the lines. News that pertains to entities like PokerStars and the Bicycle Casino can be disseminated to give some hints as to what may happen in California. For now, it remains categorized as speculation. With that said, a looming deadline on the California Legislative Calendar, a tournament coming through the Bicycle Casino, and hints at a fast-moving finalization of the Rational Group / Amaya Gaming deal give some insight as to what factors may influence the online poker bills. In the end, however, someone has to make a move. One of the pertinent parties has to bet, raise, or fold at some point. Deadline for Poker Bills Less than Two Months Away Technically, the first deadline for the California legislature to pass either of the online poker bills passed on May 30, 2014. Of the two pending bills, neither moved an inch when that date came and went. There are ways to pursue a bill after that date, such as by replacing a bill with a newly drafted one by the same legislator. The other date is August 31, 2014, and that deadline is non-negotiable. As the law states, August 31 is the last day for each house to pass bills. If nothing happens by that date, both pending bills are dead. They will need to be redrafted and reintroduced in 2015. Whether supporters and current bill sponsors State Senator Lou Correa and State Assemblyman Reginald Jones-Sawyer are up for the task remains to be seen. In fact, it all remains to be seen. The bills currently collecting dust in the legislature could begin moving at any time. And as pointed out here, time is a tickin. Amaya Might Move Quickly to Finalize Rational Group Deal When Amaya Gaming announced its acquisition of the Rational Group, including PokerStars and Full Tilt Poker, last month, there was a wide window for the finalization. The deadline was set for the end of September 2014, as financing had to be secured, the Scheinbergs had to step down, and other pieces had to fall in place before all was said and done. However, numerous reasons have arisen that could put the deal on a faster timeline. First, PokerStars wants its place in New Jersey, and New Jersey wants PokerStars. Within days after the deal was announced, the New Jersey Division of Gaming Enforcement revealed that it was looking forward to examining the developments. Even State Senator Raymond Lesniak recently commented that hes anxious for PokerStars to take a place in the states online gaming market. With a seasonal decline and other factors causing the states online gaming revenue to dip, there is no better time than the present to push things forward. Now that PokerStars is under the Amaya Gaming umbrella, or soon to be so, the DGE only needs to review the Amaya Gaming license and made adjustments for the PokerStars addition. The PokerStars acquisition becomes part of the ongoing Amaya licensing process and is reviewed for suitability by the Division like any other significant transaction by a CSIE or Casino Entity licensee, said a DGE representative. This could happen quickly. Second, the UK may be quite a distance away, but the upcoming licensing process for online gaming in the UK may prompt Amaya Gaming to speed up its acquisition. Per the newly enacted laws, the UK Gambling Commission is requiring all companies wanting to operate in the UK to have obtained a license by October 1. Applications must be submitted by September 16. If Amaya sticks to its original timeline of completing the acquisition at the end of September, PokerStars, Full Tilt Poker, and Amaya Gaming will need to obtain licenses individually in the UK. And when the merger is complete, Amaya will have to submit paperwork to change the licenses, and there may be a break in operations while the changes are approved by the UKGC. This will result in downtime for players and operators, and the lack of revenue would be significant. The benefits of Amaya and Rational Group finalizing their deal prior to mid-September are great. The sooner the acquisition is complete, the sooner New Jersey can give its approval for PokerStars and the UKGC can begin processing the operating license for the UK market. What does this mean for California? The bad actors of PokerStars, namely the Scheinbergs, will be gone from the company, and the new management of Amaya (not a bad actor) will be ready to make a case for entry to California. By finalizing the deal as soon as possible and pleading a case to California legislators and tribes, there is hope that one of the bills could be amended, resubmitted, and pushed through the state legislature before the August 31 deadline. Live Poker Moves On in California The Bicycle Casino is one of the entities that partnered with PokerStars prior to its deal with Amaya. Live poker at the Bike continues to thrive with numerous tournament series headed its way. The Summer Poker Series started on June 19 and runs through July 15. Other tours will head there later in the summer, like the World Poker Tour for its annual Legends of Poker festival, as well as the Card Player Poker Tour. And fellow PokerStars partner Commerce Casino will be hosting the Heartland Poker Tour later this year. On the other side of the aisle, bad actor clause supporters will also be hosting some poker tournaments. The Heartland Poker Tour will be hosting an August/September series at Agua Caliente, and Pechanga will offer a Summer Spectacular poker series in July. Poker is a big part of California, and there is a very large group of poker players in the state who would be happy to begin playing online poker again. Live tournaments would benefit from online poker satellites, and California would again be a hub for poker of all kinds. The legislators must decide in the coming weeks if they want to take advantage of their prominence in live poker and its possible translation into online poker success or not. Previous Post Next Post amaya|bike|pokerstars About Jennifer Newell Jennifer has been writing about poker for nearly a decade, including extensive work as a freelancer, where Jennifer has worked for numerous gaming-related websites, magazines, and blogs with a focus on players, news, and interesting stories. Follow Jennifer on Google+ and Twitter.
Earlier this year the California Senate and Assembly introduced bills that would allow the state to expand their gaming options, adding online poker to the mix that already includes card rooms, tribal casinos and race tracks. The attempt is nothing new, as this marks the fifth year in a row that California has flirted with expanding into iGaming, and even though the state is closer than ever before, its starting to look like we can get ready for Californias sixth try next year, as the legislature is running out of time to get something done before the session comes to an end. The online poker bills introduced by Senator Lou Correa and Assemblyman Reginald Jones-Sawyer are fairly similar but not identical, as they were crafted by two different factions. Additionally, the bills have run into numerous roadblocks since they were introduced, most notably the ongoing fight over who should be allowed to apply for a license should California legalize and regulate online poker, the so-called Bad Actor clause. Bad Actor opponents On one side of the aisle is the coalition that includes Morongo Band of Mission Indians, the Commerce Casino, the Bicycle Casino, and the Hawaiian Gardens Casino who are calling for lawmakers to strip out any language that would preemptively bar certain companies from applying for an online poker license namely those that accepted wagers from the US after December 31, 2006. This opposition is not surprising considering all four of these entities have signed an agreement that will see them partner with PokerStars should online poker come to California, and PokerStars falls under the definition of a Bad Actor used in the bills. The PokerStars coalition stance is that the regulators, not lawmakers, should decide which companies are suitable and which are not, just as New Jersey regulators have done. Basically, let the regulators do the job they are paid to do; regulate. Bad Actor proponents On the other side is basically everyone else, or at the very least 13 other tribes. To oppose PokerStars a group of 13 tribes have teamed up, not only voicing their opposition in letters and at public hearings, but going so far as to hold meetings to hash out any disagreements between themselves in order to focus all of their scorn on the PokerStars issue. This coalition of tribes has even drafted their own online poker bill which they were hoping would be introduced by a friendly Senator / Assemblyperson. So far nobody has stepped up to the plate and introduced the bill. The proposed bill contains comprehensive Bad Actor / Tainted Assets language that would preclude a company like PokerStars from even applying for a license in California. This groups stance is that companies that violated UIGEA should not be allowed to participate in the new regulated markets; they should not be rewarded for continuing to operate in the US during that time period. You can read more about this disagreement here: PokerStars Past Under Siege What the Bad Actor debate has done The debate over PokerStars may not have killed the bill directly, but the ongoing fight, and the inability by the two sides to come to some type of an agreement has stalled online poker talks in the state, and at this point stalling talks is pretty much the same as killing the bill. The legislature has already passed one deadline (all bills were supposed to have been passed by their House of Origin by May 30, 2014) although as I pointed out in an article at OnlinePokerReport.com several weeks ago, there are several potential loopholes to get around this deadline, including the almost farcical Gut and Amend solution that allows a lawmaker to essentially erase a current bill that has passed its house of origin and replace it with an entirely new bill. The only restriction being that the bill would have to be passed by both houses. However, there is another more steadfast deadline looming, as the legislative calendar states: Aug. 31 Last day for each house to pass bills (Art. IV. Sec. 10(c), J.R. 61(b)(17)). Final Recess begins upon adjournment (J.R. 51(b)(3)). Essentially, anything that is not passed by August 31 is officially dead. No workarounds, no loopholes, no nothing. If the California legislature does not pass an online poker bill (Senate and Assembly) by August 31 the legislative session comes to an end and any pending bills are wiped from the books. If California doesnt make some headway on online poker in the very near future we can kiss 2014 goodbye. Previous Post Next Post bike|commerce|hawaiian gardens|morongo|pokerstars About Steve Ruddock Steve Ruddock is a longtime member of the online gambling industry. He covers the regulated US online casino and poker industries for variety of publications, including OnlinePokerReport.com, PlayNJ.com, USPoker.com, and USA Today.