Rep. Jason Chaffetz (R – Utah) is not planning to try to kill daily fantasy sports (DFS) along with online poker in his anti-online gambling bill, according to the Las Vegas Review-Journal. Last week, the Review-Journal reported that Chaffetz, Chairman of the Committee on Oversight and Government Reform as well as a member of the House Committee on the Judiciary, is cognizant of the potential legal issues surrounding DFS, but has no ambitions to add DFS to the Restoration of America’s Wire Act (RAWA).
And why would he? Las Vegas Sands CEO and billionaire Republican mega-donor Sheldon Adelson, the driving force behind RAWA (which Chaffetz introduced in the House in February), isn’t against DFS and does not see it as a threat to his business, as he does online poker. What daddy wants, daddy gets.
Chaffetz said that because fantasy sports and online horse racing are already given exemptions in other legislation, he is not going to mess with those. Instead, wants to change the definition of a law without actually changing the law itself, just to suit Adelson’s desires.
“There were already other carve-outs in place. My position has been that you just don’t unilaterally change a law. You can’t erase it or add one without going through Congress,” he said. “I’m trying to hold tight to just restore it exactly as it was previously. I’m not trying to make exceptions or adjustments to it.”
What he fails to say is that the law to which he is referring, the Federal Wire Act, wasn’t changed. It was simply re-interpreted correctly. Unfortunately for Adelson and his cronies, that correct interpretation is not one that they like. Take a look at the text of the Wire Act, put in place in 1961 (emphasis added):
Whoever being engaged in the business of betting or wagering knowingly uses a wire communication facility for the transmission in interstate or foreign commerce of bets or wagers or information assisting in the placing of bets or wagers on any sporting event or contest, or for the transmission of a wire communication which entitles the recipient to receive money or credit as a result of bets or wagers, or for information assisting in the placing of bets or wagers, shall be fined under this title or imprisoned not more than two years, or both.
It clearly names only sports betting, not other forms of gambling. For whatever reason, though, the Department of Justice for the longest time interpreted the Wire Act as applying to all gambling over wire communication (read: internet), so online poker was considered illegal even though it really wasn’t. At the end of 2011, the DoJ revised its interpretation, saying that the Wire Act did, in fact, only apply to sports betting. This opened the door for individual states to legalize and regulate online gambling, including poker, as the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) explicitly says that states can authorize intrastate online gambling. Nevada, New Jersey, and Delaware have all done so and several other states are looking into doing the same.
RAWA would not “restore” the Wire Act, but rather the incorrect, pre-2011 interpretation of the law. What it would do would shut down the internet gambling industries of three states. Chaffetz is completely talking out of his ass. The question is does he actually believe what he is saying or is he just lying to please Adelson.
What’s funny about Chaffetz’s comment is that he said he isn’t going after DFS because it already has a carve-out in existing law. By his own logic, intrastate internet gambling should be left alone because it, too, has been given an exemption in the UIGEA.