Wall Street Journal Sequel On Online Gambling
Published: Wednesday, April 05, 2006 Online-Casinos.com
WALL STREET JOURNAL SEQUEL ON ONLINE GAMBLING
Ted Loh speaks up
In an interesting sequel to the Carruthers-Leach debate, online gambling player Ted Loh wrote the Wall Street Journal editor with a few facts and figures of his own regarding allegations made against the online gambling industry by Rep. Leach.
Ted Loh drew the editor's attention to one of the key points of Mr. Leach's campaign: the allegation that online gambling serves as a haven for money launderers, based on the testimony of a fomer chief of the FBI's Financial Crimes Section, Dennis Lormel.
Ted Loh wrote that Mr Lormel, in his testimony to Congress, did not at any point provide any proof whatsoever of his claims, despite the normal practice of those testifying before Congress typically providing all manner of photographs, slides, charts, handouts, and other collateral. He essentially asked Congress to take him on his word alone.
"Also relevant may be the fact that Mr. Lormel delivered this testimony shortly after 9/11 under what was obviously a highly-charged situation with reason to be overprotective without properly researching the facts," Ted Loh says. "In his current bio, posted at http://corprisk.timberlakepublishing.com - you will note that there is no mention whatsoever of his testimony regarding online gambling, which Mr Leach so highly depends upon."
Loh says that Mr Leach also points to the Department of State report about a "concern" which states that "For these reasons, Internet gambling operations are vulnerable to be used, not only for money laundering, but also criminal activities ranging from terrorist financing to tax evasion." However, he asks the editor to note that the Department of State did not make any such claim that the online gambling industry was a haven for money launderers - it only alluded to the possibility of such a situation.
"Since no one has provided any proof of money laundering through the online gambling industry, it must be assumed that the industry is innocent of any such allegations until otherwise proven, or strong credible sources established," writes Loh. "This renders Mr Leach's primary argument useless without any further substantiation."
"Mr Leach further refers to breaches in law of the Wire Act and the Professional and Amateur Sports Protection Act - but in stating so, says that "When a site solicits and accepts wagers on sporting events and games of chance, these online casinos violate the Wire Act and the Professional and Amateur Sports Protection Act". What he does not appear to realize is that the Wire Act and the Professional and Amateur Sports Protection Act relate only to the act of placing sports wagers. Games of chance and online casinos are not covered by these Acts. Furthermore, a Federal Court from the Eastern District of Louisiana pronounced that "internet gambling on a game of chance is not prohibited conduct under the Wire Act".
Loh points out that the regulation of gambling has traditionally been held by each individual state government. Mr Leach, in fact, stated that "He (Carruthers) is also suggesting not only that the law of the U.S. (the above two referenced statutes) but similar laws that currently exist in all 50 states be overturned." Mr Leach is obviously oblivious to the fact that he too is suggesting that he be allowed to usurp the rights of each state by introducing a federal Act. He cannot have it both ways. Nevada has already introduced its own state legislation barring Internet gambling, as have some other states. So why does he think he needs to introduce federal legislation which will overlap with currently existing legislation in various states?
"Mr Carruthers is in favor of regulation, as are many operators in the online gambling industry to the best of my knowledge," Loh says. "Mr Leach says it cannot be regulated. But interstate commerce is regulated by federal law. Telecommunications are regulated by the FCC. US companies with locations outside the US still pay federal taxes. What makes the online gambling industry any different? Why should it not be allowed to pay taxes? Why should it not be allowed to subject itself to proper regulatory methods which are already in use in other industries?"
