The Congressional Record is a unique source of public documentation. It started in 1873, documenting nearly all the major and minor policies being discussed and debated.
“GLOBAL CASINOS POSE VIRTUAL MESS” mentioning the U.S. Dept. of Justice was published in the Senate section on pages S17101-S17102 on Nov. 15, 1995.
The publication is reproduced in full below:
GLOBAL CASINOS POSE VIRTUAL MESS; LAWMAKERS SAY ELECTRONIC GAMBLING
DIFFICULT TO REGULATE
Mr. LUGAR. Mr. President, I ask that the following article be printed in the Record.
The article follows:
Global Casinos Pose Virtual Mess; Lawmakers Say Electronic Gambling
Difficult To Regulate
(By Ron Bartlett)
So you're sitting at home, somewhere in Florida, and you've got the itch to go casino gambling?
No problem. Chances are by early next year, no matter where you live in the state, such an opportunity will be at your fingertips.
Through a personal computer, you'll be able to glide down the hallways of a glittering casino, passing rooms filled with roulette wheels and slot machines. Once you pick a game, you'll be able to plunk down a bet and take on other gamblers from across the globe.
But this won't be for play. This will be for real, cold, hard cash.
Didn't state voters resoundingly reject casinos in 1994 for the third time?
Sure they did. But savvy entrepreneurs are using electronics to introduce new forms of gambling that are likely to be widely available in Florida and throughout the United States in the coming months.
In a rapidly developing market, offshore companies based mostly in the Caribbean are beginning to offer ``virtual reality'' casinos and sports book operations on the Internet, the worldwide network of computers.
From your easy chair in Tampa, it soon will be possible to place real bets through your personal computer at virtual casinos in places such as Antigua and St. Martin. Some of these games will come with sophisticated graphics and video that will give players at home the feeling that they are inside a major casino.
While the first such virtual casino isn't yet operating, predictions are that hundreds could be up and running within the next year.
Meanwhile, the Coeur d'Alene Indian tribe in Idaho plans to offer a national lottery by year's end that some experts say ultimately could offer weekly jackpots up to $200 million.
The tribe wants to set up toll-free 1-800 lines that players would use to dial in numbers and give their credit card information.
And Floridians who want to bet on sporting events already can call Connecticut or New York, which offer national telephone wagering.
The expansion of electronic gambling is not only creating new outlets for players but also bringing wagering directly into the home, which gaming entrepreneurs view as the new frontier. In Florida and other states, the trend is worrying law enforcement officials, regulators and lawmakers.
On one level, there are concerns that electronic gambling will hurt business at existing state lotteries, pari-mutuel facilities, bingo halls and Indian gaming facilities.
On another, there are fears it will be difficult, if not impossible, to regulate offshore casinos operating on the Internet, that consumers won't be adequately protected, and that the new opportunities could increase gambling addiction and all its dangers.
Earlier this month, the chairman of the Florida House Regulated Industries Committee asked state Attorney General Bob Butterworth to investigate what, if anything, the state can do to stop Floridians from betting on the emerging virtual casinos or from calling other states to wager on sports events.
State Rep. Steven Geller, a Hallandale Democrat, said his request wasn't a moral stance against gambling, rather, he wants to protect the state's struggling horse and dog tracks and jai alai frontons, which generate jobs and taxes.
``If you have access to a virtual casino and play blackjack, how do you know that the casino in Antigua is run honestly?'' Geller asked. ``How do you know that the roulette wheel isn't rigged?''
Butterworth hasn't responded to Geller's inquiry. But with the Internet gambling in particular, he says, any regulatory answers rest in Washington, not Tallahassee.
``How do you stop it from coming into states that don't want it?'' Butterworth said. ``How do you tax it in states that do want it? I don't know how you do that without the federal government taking the lead.''
Some members of Congress are grumbling about online gambling. The Justice Department has declared it illegal in the United States, saying it will act on violators. But to date, the full extent and scope of the federal response--if any--remains to be seen.
Under federal law, it's a crime for anyone in the gambling business to use an interstate or international telephone line to transmit information assisting in the placing of bets. But it's not illegal to make a bet, as long as you're not in the gambling business. The Coeur d'Alene tribe would have callers place bets to its operations in Idaho.
I. Nelson Rose, a Whittier College law professor and gambling expert, believes Americans running offshore virtual casinos could face seizure of their assets under federal racketeering statutes. But foreign nationals operating the facilities are likely beyond Uncle Sam's reach, and players are usually hard to trace and aren't prosecuted.
``Because it's so new, people don't really know how to respond to it,'' said Jeff Frentzen, who follows developments on the Internet for the magazine PC Week. ``In some corners, it's viewed as a threat.
``It reminds me of what was going on earlier this year with the Internet pornography issue. It's a global system, and it's really hard to control.''
One company on the Internet is Sports International Ltd., which says it has 25 to 30 people working at its computer operation on St. John's, Antigua. It does marketing and software development at an office outside Philadelphia.
The publicly held company, which says it handled $48 million in its first year, has been taking bets on sports events on the Internet since February. During the first quarter of 1996, it expects to offer ``Global Casino,'' in which players at home will be given software that will make it seem as though they're really inside a gambling hall.
The way the online operations are typically set up is this: Players either send money or use a credit card to establish a prepaid account on the island where the game is administered. They use that money to gamble. Their winnings are either rolled back into their account, or wired to them. That way, all the gambling takes place outside the U.S.
Jeffrey Erb, a Sports International official, said players are responsible for paying taxes on their earnings. He said the company has a simple incentive for maintaining integrity: Any customer who felt cheated could instantly put the word out to millions of Internet users.
At this stage, the phenomenon of Internet gambling is so new and so rapidly evolving that no one really knows what its ultimate impact on the gaming industry will be.
Roger Gros, the Atlantic City-based editor of two industry publications, Casino Journal and Casino Player, said that in recent months, he has heard about a half-dozen announcements for virtual casinos. But more are coming; within a year, he expects hundreds.
Still, he doesn't think they'll fundamentally alter the casino landscape. At least not now.
``It's just going to be a little sidelight for people who want to gamble and know how to use the Internet,'' he said.
``But I don't think it's going to be a major factor in the gambling industry.''
While Butterworth is still trying to determine whether he can do anything to halt electronic gambling on the Internet, he and other attorneys general from around the country already have taken a strong stand to stop the Coeur d`Alene tribe's proposed national lottery.
In March, Butterworth sent a letter to all telephone companies in Florida, warning that use of their phone lines for carrying gambling information across state lines would violate both state and federal laws.
Meanwhile, the National Association of Attorneys General passed a resolution urging the National Indian Gaming Commission and U.S. Attorney General Janet Reno to take action to prevent the ``illegal'' lottery. A bill introduced in Congress would effectively kill the planned lottery by amending current law to require that all players be physically present at the game.
The tribe wants to run its weekly game where state lotteries already exist--that's 36 states and the District of Columbia, a huge potential market that far exceeds any other lottery. The tribe contends it has received all the government approvals it needs and says its detractors are just afraid of competition.
Indeed, that fear is high in Florida. Officials say the Indian lottery could severely hurt ticket sales for the Florida Lottery, and cut into the more than $800 million it raises for public schools each year.
Butterworth vows to go to court the moment the tribe's lottery is up and running.
Yet another form of electronic gambling that is now being offered by lotteries in five states, including California and New York, is keno. But it's doubtful it will appear in Florida, at least in the near future.
Under keno, players select up to 20 of 80 numbers, and then watch randomly selected numbers flash on a screen. How much they win depends on how many of their numbers appear. The games are run every five minutes, and terminals are being installed in restaurants, bars, bowling alleys and convenience stores.
Florida Lottery Secretary Marcia Mann said her staff hasn't studied keno for possible introduction and doesn't intent to.
``Knowing our governor like I do, I think he would see that as too much of a proliferation of gambling and too much like casinos,'' she said. Gov. Lawton Chiles has generally been a staunch opponent of gambling.
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SOURCE: LAWMAKERS SAY ELECTRONIC GAMBLING DIFFICULT TO REGULATE
