Posts Tagged ‘Michigan’
As my colleague Earl Burton wrote a couple days ago, there has been an uptick in online poker regulation activity in a number of states in the last few months. One state mentioned in his piece was Michigan, whose online gaming effort he said “hasn’t moved beyond talking.” But last week, a Michigan legislator did finally take the formal step and introduced a bill that would legalize and regulate online poker.
It was State Senator Michael Kowall, a Republican representing District 15, who introduced Senate Bill 0203 on March 1st, a bill which would create the “Lawful Internet Gaming Act.” The bill would authorize the new division of internet gaming to grant licenses to the state’s casinos. Of course, the casinos would have to apply for said licenses and would have to pay $ 100,000 to do so. The licenses would have a duration of five years and would come with a fee of $ 200,000 for the first year and $ 100,000 per year after that.
Online gaming vendors – for instance, companies that might provide poker software or computer equipment for the poker operators – can also apply for separate licenses. The price tags on those licenses would be significantly less than for the operators themselves: $ 5,000 for the application fee, $ 2,500 per year, and $ 5,000 for the first year.
The state would tax gross gaming revenue at 10 percent.
The beginning of bill explains that legalizing and regulating online poker makes sense for Michigan for reasons most of us have been preaching all along. The internet is woven into our lives just like telephones and televisions and people like to play poker online. These people should have the chance to play behind the consumer protections of regulations:
The legislature finds that the internet has become an integral part of everyday life for a significant number of residents of this state, not only in regard to their professional lives, but also in regard to personal business and communication. Internet wagering on games of chance and games of skill is a core form of entertainment for millions of individuals worldwide. In multiple jurisdictions across the world, internet gaming is legal, regulated, and taxed, generating billions of dollars in revenue for governments.
In order to protect residents of this state who wager on games of chance or skill through the internet and to capture revenues and create jobs generated from internet gaming, it is in the best interest of this state and its citizens to regulate this activity by authorizing and establishing a secure, responsible, fair, and legal system of internet gaming that complies with the United States Department of Justice’s September 2011 opinion concerning 18 USC 1084.
The regulations actually set out in the bill are fairly run-of-the-mill. Players must be 21-years old and located in the state of Michigan, players must be permitted to self-exclude, and online gaming operators must have procedures and technologies in place to be sure that only people permitted to play can actually logon and play, as well as being able to detect and prevent cheating.
While the bill does specifically mention online poker, it also says that it is not strictly limited to online poker and that other games can be offered.
Interstate compacts in which multiple states’ player pools are combined are also permitted.
Even if the bill somehow charges through the Michigan state legislature and becomes law quickly, it still could be a long time before any online poker rooms launch in the state. The division of internet gaming would be given a year to get all the rules set (could be less time, of course) and then nobody would be allowed to offer games for 150 days after the rules are formally laid out.
With the 2016 World Series of Poker in full swing, we sometimes might overlook that there is OTHER poker news that is going on. With that in mind, it is time to take a look around the poker world and check that information out, just “In Case You Missed It.”
Michigan Senate Committee Passes Online Poker Regulations
In a bit of news that we’ve heard several times, a Michigan Senate committee has passed online gaming and poker regulations for the state. The Michigan Senate Regulatory Reform Committee passed, by an 8-1 margin, SB 889, which would regulate internet casino gaming and poker for Michigan citizens. With this said, there are some issues that the bill faces before it can even begin to be entertained by the Michigan Legislature.
First off, the bill would have to be called for a vote by the Senate Majority Leader, Arlan Meekhof. Meekhof’s position isn’t known on SB 889, but GamblingCompliance.com’s Chris Krafcik points out that there is still opposition to the bill including the Michigan Attorney General, Bill Schuette, and potentially Governor Rick Snyder, who has constantly been anti-gaming expansion in the state. Then there is the small issue that there is no legislation in the Michigan House to accompany the Senate’s action; without this, the bill cannot move forward.
The time is very short for any legislative action in Lansing. The Michigan Legislature adjourns at the end of June, at which point any outstanding bills would “die” and have to be resubmitted for the next session. The Legislature is currently bogged down in two important areas: budget negotiations that have been ongoing for the last couple of months and how to handle the water crisis in the city of Flint. The budget negotiations are of primary interest to legislators and, until something passes on that, any other legislation is held up, including the online gaming regulation.
There is a bright light on the news from Michigan, however. At the start of 2016, the Wolverine State wasn’t even on the radar when it comes to online gaming and/or poker regulation. Only in the last couple of months has the potential for such legislation come to light. If the current bill doesn’t survive the session, it posits that it will be primed for a strong return in the next legislative session.
Chris Moorman Signs Sponsorship Deal with 888Poker
One of the greatest online poker players in the history of the game, the United Kingdom’s Chris Moorman, has signed a deal with 888Poker to represent the site.
“888 is doing big things and really is working hard to expand their reach in poker,” stated Moorman during the announcement of the new deal. “Things like sponsoring the WSOP and the Super High Roller Bowl have shown they are committed to their growth of the brand, and I can’t wait to see what they have coming up in the future.” Moorman will ditch his usual online moniker of ‘Moorman1’ in favor of a new name, ‘888moorman.’
888Poker is the latest stop in what has been a rather rocky road for Moorman in the online poker sponsorship world. In 2009, Moorman signed with Doyle Brunson’s eponymous poker site, Doyle’s Room, as one of the heralded “Brunson 10,” but that partnership fizzled soon afterwards when the room was absorbed by Cake Poker. In 2011, Moorman became a sponsored pro with Lock Poker, but storm clouds were on the horizon. When it became apparent that there were operational issues with Lock Poker, Moorman was quick to leave, departing in 2013 with fellow pro Paul Volpe rather than staying (as Annette Obrestad did). Thus, when Lock Poker collapsed in 2015, owing somewhere in the neighborhood of $ 15-$ 20 million to players, Moorman could not be held accountable for the issues.
This time around, it seems Moorman might have found a home. The second largest online poker site in the industry, 888Poker has been aggressive of late in getting their name further into the marketplace. They are one of the premiere sponsors at the WSOP and were among those that were featured sponsors of the 2016 Super High Roller Bowl at Aria in Las Vegas. 888Poker also provides online poker platforms in Nevada, Delaware and New Jersey, the three states in the U. S. that authorize online gaming and/or poker.
On Wednesday, the Michigan legislature’s Regulatory Reform Committee held an informational hearing to discuss two related online poker bills: SB 889, which would legalized and regulate online gambling in the state and SB 890, which would amend Michigan’s penal code to permit for the online gambling that is legalized in SB 889. From the sounds of it, it was a solid hearing filled with reasonable people interested in educating themselves on internet gaming, unlike hearings we have seen on Capitol Hill.
USPoker.com’s Steve Ruddock was on hand in Lansing providing live updates on the hearing, so credit to him – I’m just lounging around in Georgia (look, man, my kid had a Little League game tonight). Amongst the witnesses at the hearing were three representatives from Amaya/PokerStars: Jeanne David, head of PokerStars’ responsible gaming efforts, Steven Winter, Amaya’s director of operations, and Matthew Robins, director compliance.
Ruddock reported that all three gave excellent, detailed presentations on how they protect their customers. He called Jeanne David’s explanation of the company’s responsible gaming protocols “eloquent.” She demonstrated the options players have on placing limits on their play, such as setting restrictions on stakes or losses, both on a daily or even per-hand basis (the latter would be for casino games, presumably).
Steven Winter discussed how the company combats gaming fraud and detects problem gambling behavior. He went over a host of things such as how the site makes sure players are who they say they are via identity technologies and geolocation. He also explained how PokerStars maintains the integrity of its games.
Matthew Robins focused on how PokerStars works with different jurisdictions on their varying money laundering protocols and how, despite what opponents of online gambling will say, it is harder to launder money online because of the data trail.
One of the stars of the hearing was Poker Players Alliance executive director John Pappas. In a lengthy (twelve page!) statement, which can be found on the PPA website, Pappas dropped knowledge on the Committee.
“S.B. 889 should not be viewed as an expansion of gambling in Michigan, but rather as an opportunity to protect consumers and add a new distribution channel for the state’s existing, and tightly regulated, gaming industry,” he said. “To be clear, citizens of this state have access to online poker, online casino games and online sports betting – but they play on foreign sites, none of which are properly licensed or regulated by this government.”
He then made the bold move of bringing up an instance in which poker players were ripped off by a poker site, something that some people would probably prefer wasn’t brought up in front of lawmakers.
This void in consumer protection is all too real for Michigan residents who played on Lock Poker, an online site based in Curacao, which abruptly shut down in April 2015, and took millions in player deposits. Sadly, because of zero regulatory oversight, there’s nothing affected customers can do to get their money back and to hold this rogue website accountable. S.B. 889 changes this dynamic and puts Michigan in control of internet gaming by corralling the unregulated market and turning it into a state-based industry that is safe for consumers and accountable to regulators.
His point was an excellent one. It is not that a poker site couldn’t do bad things in a regulated environment – after all, companies run afoul of the law every day – it’s that customers would have recourse if they were wronged.
After slumbering through the first quarter of 2016, the drive for another state to join the three United States locales that have already enacted online gaming or poker legislation grew by one with the addition of the state of Michigan.
On Friday, Michigan State Senator Mike Kowall introduced his bill SB 889, or “The Lawful Internet Gaming Act” to the Michigan State Senate. Kowall is not a newcomer to the Michigan Senate, having been seated in the legislative body since 2010 and earning reelection from the 15th District in 2014. The bill will begin its process at the Committee on Regulatory Reform (of which Kowall is a member) and look to make its way through the Michigan Legislature before the end of 2016, which will be the end of the current legislative session.
The bill itself mirrors many that have been seen in the past – the reason for enacting the legislation is to “protect the residents of the state” and it is “in the best interest of the state to regulate the activity” – and the specifics are also along the same lines with other states. Players would have to be 21 years old to participate; the activities allowed would include online poker and casino gaming; the different casinos and tribal gaming outlets in the state would be eligible for a license and licensing fees would be $ 5 million with a 10% tax on gross gaming revenues. Where the bill differentiates is that is explicitly allows for either a U. S.-based gaming network (interstate network or compacts) or allows for international play.
Tucked into the bill is the statement “a wager may be accepted from an individual who is not physically present in the state.” This is a stark departure from previous efforts in other states that restricted their activities to just inside their borders. With this said, there are difficulties that face the bill in the Michigan Legislature.
Michigan has casino gaming and tribal gaming, two forces that often clash as they seek to pull in as much of the market as possible. There is also a system of charitable poker rooms throughout the state that have, for the past three-plus years, been under consistent fire from the state government as to their operation and regulation. Even though Kowall is a part of the trifecta of leadership in the Wolverine State (both bodies of the Legislature and the Michigan governorship under Rick Snyder are all Republican), there may not be much stomach to expand gaming in the state right now.
With Michigan getting into the mix, it reawakens the drive for online gaming and/or poker regulation in some other areas that have perhaps tabled the issue. In California, the nearly decade-long logjam between the different parties in the Golden State (card rooms, tribal casinos and horse racing tracks) shows no sign of being broken, even though there have bene offers to the horse racing industry to get out of the way (to the tune of $ 60 million). Adding into the infighting issues are the charges currently pending against the “on leave” CEO of Amaya Gaming and PokerStars, David Baazov, which have thwarted PokerStars’ lobbying efforts in the state.
In Pennsylvania, it is more political infighting that has shut down online gaming and poker regulation. Despite additional revenues that would allow them to try to keep taxes a bit lower, the Pennsylvania General Assembly is still at odds over a budget for the Keystone State. At one time, online regulation was in the mix for the state but, over several rewrites of the different budgets that have attempted to move through the legislature, online gaming and poker regulation is currently not in the mix as the legislature is mired down in a quagmire.
The same is true for legislation in the state of New York. After introducing it earlier this year and actually having the regulations included in a budgetary statement, online gaming and poker regulation was removed last month as the budget moved forward without it. For the past two years (and now, it seems, three), online gaming and poker regulation has been proposed as a “talking point,” but it hasn’t gotten much further.
Since 2013, when Nevada, New Jersey and Delaware became the first three states to pass online gaming regulation of some sort, there has been an audience waiting with bated breath for the next state to come along. As this is a major election year, it is highly unlikely that any legislative body will touch a bill that has, to be honest, significant and controversial issues potentially with their constituents. Even though Michigan’s moves are interesting, don’t expect a fourth state to come along before 2017.
One of the best ways for charitable organizations to raise funds is to throw a “Casino Night” or, more recently, a charitable poker tournament. The funds raised by such activities are a boon for the charitable cause and they provide a return to the participants, usually in the form of prizes but sometimes in cash. In several states charitable poker is legal and recently two states have experienced issues with their systems.
In the state of New Hampshire, the betting limits for charitable poker games were removed by the state legislature, which has greatly affected the money being raised during these events. The previous law had set the stakes at $ 4 per hand but the new bill, known as HB 169, removed the bet limit but put a $ 150 cap on what a player could buy in for at the table. The bill was signed into law on June 30 by Governor Maggie Hassan and went into effect on July 1.
According to the New Hampshire Union Leader’s Garry Rayno, a rep from a Milford charitable gaming location has stated the new law has caused a tremendous increase in revenues. Rick Newman, who is the representative of the River Card Room in Milford, stated that the room took in $ 40,000 in July 2015, a twentyfold increase compared to the same time period in 2014. Rayno quotes Newman as saying that everyone is pretty pleased with the situation, saying “The charities got 35 percent, the state 10 percent and a lot more dealers have jobs.”
All is not good in the legislature, however, who have heard of some of the charitable rooms bending the rules a bit. In one case, a particular room allegedly allowed up to five buy-ins for a stake of $ 750. Newman’s facility in Milford allows for a player to have $ 300 in front of them and to only buy-in twice. The action has gotten so good that some players who used to frequent the Indian casinos in Connecticut, Mohegan Sun and Foxwoods Resort Casino, are now staying in New Hampshire to play instead of trekking to the tribal casinos.
Several members of the Racing and Charitable Gaming Commission made the comment to Rayno that the bending of the rules “takes the games out of charitable gaming into real gaming.” The chairman of the Commission, Ted Connors, denies that it is out of control but has stated that the Commission will be looking to make some changes to the new laws when they meet on September 9. Until that time, Connors says, “It’s quite a bonanza for the charities.”
The second instance of issues with charitable poker comes from Michigan, which has had a very convoluted history with charitable poker.
According to the Michigan Gaming Control Board, counterfeit currency was passed at a charitable poker room in the Detroit area. Nine fake $ 20 bills were used to buy chips during one of the “millionaire parties” that was staged last month. The event was to benefit a Michigan children’s summer camp and it was the workers at the poker room and volunteers from the charity itself (all charities have representation on site during one of their events) that discovered the counterfeit bills while paying out players.
The case is still under investigation, but an official with the MGCB offered some suggestions for identifying whether a bill is fake or not. “Look at the printing quality and the paper characteristics,” Mary Kay Bean of the MGCB told CBS Detroit. “Check for watermarks, look for fake corners and some other things that could be triggers that the bill is not a real U. S. bank note.”
Michigan’s charitable poker industry has been involved in a lengthy fight with Rick Kalm, the chairman of the MGCB who has attempted to hem in the industry over the past three years. While he has been successful in some of his efforts, Kalm has been thwarted by a strong grassroots effort from charities, the charitable card rooms and the Michigan legislature from fully putting his oversight into full bloom. The Detroit instance isn’t expected to have a significant effect in swaying any side in the ongoing fight, however.