Thoughts About Neteller and the World Series of Poker

by Lou on July 17, 2007

While the World Series of Poker rushes headlong to conclusion with a cast of players very few people recognize, two of the most notable members of the online gaming community, Neteller founders Stephen Lawrence and John Lefebvre, pled guilty to the use of wires to transmit interstate and foreign commerce bets and wagering information. It will cost each of them at least $100 million.

In addition, they each face a maximum sentence of five years’ imprisonment and a fine of $250,000 when sentenced in late October.

Lawrence and Lefebvre each admitted that they conspired with others to promote illegal gambling by providing payment services in the United States to offshore internet gambling businesses.

Although the Neteller case put the kibosh on the ability of online poker players to fund and withdraw money from their online poker accounts, the Neteller case against Lawrence and Lefebvre has nothing to do with poker, and nothing to do with the Unlawful Internet Gaming Enforcement Act (UIGEA). The transmission of interstate and foreign commerce bets and wagering information referred to Wire Act violations, primarily sports betting.

Government anti-gaming efforts effectively drove Neteller from US shores and froze money in player accounts that won’t be released until Neteller works out the details with the US Attorney.

There’s some bitter irony involved in all of this too, because Neteller provided financial intermediary services for services other than gambling, and that money is also in a state of suspended animation. I’m a good example. All of the $4,000 some-odd dollars of mine that’s currently held by Neteller is unrelated to online gaming. In my case, it’s money for magazine articles and related writing for overseas clients. All I did was write about gaming, and in this case, I’m not guilty of anything.

Nevertheless, I’m sure the US Attorney’s actions were aimed at crushing online poker, something they seem bound and determined to stop. By attacking and crushing the means and mechanisms by which money could be moved from player to game site and back again, the Feds effectively cut the heart out of the growing online poker community, while cutting down on the proliferation of tournament poker that occurred because players were able to win their entry into high-cost tournaments in traditional casinos through online satellites.

Case in point: While the World Series of Poker experienced record turnouts this year, attendance was down for the $10,000 buy-in, no-limit hold’em main event because fewer online players entered satellites and registered to play.

I wonder if the government realizes what an ultimately futile effort theirs is. Trying to stop online gaming at this point is an exercise in squeezing toothpaste back into the tube. Gambling has been with humanity since the dawn of time, and the ability to take responsible risks when the circumstances favor success is one attribute that has continued to advance the species.

People will gamble. The internet is just the newest media that provides the games people play. The online gaming community will ultimately succeed and government repression is doomed to go the way of Prohibition.

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