New Attempt To Get Around US Gambling Ban
Published: Friday, April 22, 2005 Online-Casinos.com
NEW ATTEMPT TO GET AROUND U.S. GAMBLING BAN
Internet Cafe *Sweepstakes*
is illegal says state AG
Noone can accuse the owner of an Internet cafe
in Casper, Wyoming of lacking a sense of adventure. He has implemented an ingenious
if complicated scheme which he believes will get around the Internet gambling
problem.
The cafe sells long-distance phone cards that are loaded with
sweepstakes points that players can use to play casino-type games online - and
win cash - on the Internet cafe's computers.
The state attorney general
says it's illegal gambling, and the local prosecutor is investigating.
But
the operator claims it's a legitimate business promotion plan, no different from
instant-win twist-off caps on a soda pop bottle, aimed at boosting sales of their
legitimate products: phone cards and Internet time.
Wyoming is one of
eight states where these sweepstakes are played; the others are Alabama, California,
Florida, Hawaii, Massachusetts, South Carolina and Texas.
Customers at
the Casper cafe can buy either Internet time by itself or a combo deal - $5 for
a 100-minute phone card, one hour of Internet time and 100 sweepstakes points.
Those points can be used only to play games on the cafe's computers. Points won
playing those games - the games pay out on average 92 percent - can be redeemed
for cash or for more long-distance time.
The games themselves mimic casino
games. Keyboards don't sit in front of the screen, but are stashed in a floor-level
basket, as players seem to prefer the touch-screens. The games have full casino
sound effects.
William Consterdine, vice president of Extreme Insured
Products, which distributes the games, understands why at first glance people
might see the Internet Cafe as a casino.
But, he said, there's one key
distinction.
"It's a free game," he said. "When a person
comes in and buys a phone card from us, if they want to sit down and use their
sweepstakes points to log on to our games, they can. If they don't want to, they
don't have to. They can take their phone card and leave."
What's
more, he said, the sweepstakes points cannot be traded for cash or merchandise,
they can only be used to play the games. The points won playing the games cannot
be used to continue playing, they can only be redeemed for cash or merchandise.
"A traditional slot machine, you walk in, you put $20 into it, you
win, lose, win, lose - you're playing your money back and forth," Consterdine
said. "Our system doesn't work that way at all. The only way that you can,
basically, continue to play our sweepstakes game is you have to buy more product
from us."
And that, Consterdine said, is what it all comes down
to. Internet Cafe and other similar businesses are selling legal products. The
sweepstakes is just a promotion.
Wyoming Attorney General Pat Crank disagrees,
saying the computers used in the sweepstakes appear to be thinly veiled gambling
devices, comparing this to putting a pay phone on the side of a slot machine.
Bob Jarvis, who teaches gambling law at Nova Southeastern University
in Fort Lauderdale, Fla., said the classic definition of gambling is that someone
gives up something of value to take a chance at winning a prize. "If I were
a prosecutor, I would simply make the argument that this is not a legitimate business
promotion because the Internet Cafe is not being used primarily that way,"
he says, adding that how customers use the legitimate products, how the sweepstakes
games appear and how they're promoted - could become relevant if the case goes
to court.
"Certainly there's a chance involved, because they only
pay out 92 percent," Jarvis said. "You're trying to win something of
value, which are the credits, or the points, which you can then go and redeem
at the cash register for money."
"The question is," Jarvis
said, "are they risking anything?"
Carl Mahs, of Fort Worth,
Texas-based Game Systems Inc., which designs the game software, insists there's
no risk involved. Sweepstakes points come free with the purchase of a phone card,
and people can enter the sweepstakes either online or by mail without making a
purchase.
