DFS Passage Prompts Calls for California iPoker Action

California PokerThe rapid passage of a bill to regulate Daily Fantasy Sports in California has prompted calls for similar swift action on online poker legislation.

During yesterday´s session of the Californian Assembly, a bill was passed regulating Daily Fantasy Sports betting – less than six months after DFS legislation was first considered by the legislature. The bill imposes a yet-to-be-announced licensing fee on operators that would be used as a credit against yet-to-be-announced future taxes on gross gaming revenues.

Under the “Internet Fantasy Sports Game Protection Act” (AB 1437) operators would be required to segregate players´ funds from their operating funds, and provide safeguards to prevent underage gambling, fraud and multi-accounting, In return for a higher level of protection, players will have to pay income tax on their winnings – operators being required to report all wins to the Franchise Tax Board.

DFS Act Not a Law Yet

Despite its nearly unanimous passage through the Assembly, the “Internet Fantasy Sports Game Protection Act” will still have to overcome a couple of hurdles before it is enacted in the statute. Attorney General Kamala Harris is still to give an opinion on whether Daily Fantasy Sports betting is illegal under California state law, and the bill still has to pass through the Senate.

Furthermore, as was reported on PokerRealMoney.com two weeks ago, the bill faces opposition from tribal gaming communities, who see the “not fully cooked” content of the bill as a state-sanctioned expansion of gambling. Chairman of the California Nations Indian Gaming Association – Steve Stallings – said that the Association would “definitely take action” to prevent the bill from becoming law.

Amaya Welcome Progress of DFS Bill

Amaya Gaming – the owners of PokerStars and StarsDraft – welcomed the passage of the bill. With no “bad actor” clause in its content, StarsDraft could apply for a license to operate Daily Fantasy Sports betting, which should then nullify the objections about PokerStars getting a license to operate online poker in California – assuming legislation to regulate online poker is ever passed.

In a statement to the press, Eric Hollreiser – Amaya Gaming´s VP of Corporate Communications – said:

We are very supportive of the CA bill and believe it reflects the kind of consumer protections and industry standards that we support as the leading regulated online gaming company in the world.

We also see strong correlation between the merits of this legislation and the merits in regulating online poker, which similarly has millions of Californians participating in today without the protections provided by state regulation and oversight, without the stringent licensing of operators and without the benefit of state revenue derived from the activity.

PPA Also Adds Call for California iPoker Action

The Poker Players Alliance (PPA) also issued a statement calling for politicians to accelerate the passage of online poker legislation. John Pappas – the PPA´s Executive Director – said that Californian online poker players are currently playing on unregulated poker sites with no player protections at all. He said that an online poker consumer is the same as an online DFS consumer, and both deserve equal consumer protection.

The swift passage of a DFS regulatory bill shows that California lawmakers do in fact care about protecting consumers who play games online. Therefore, we urge the legislature to immediately move legislation that also protects Californians who want to player poker online through appropriate authorization and regulation. If legislating consumer protections for DFS players is a priority for the legislature, the same should be true for Internet poker players.

Of Course, it is Not as Easy as That

If politicians had a free hand in regulating online poker in California – and raising tax revenues for the state – it would have happened five years ago. Unfortunately there are too many self-interested parties involved in the industry to find a consensus on who should be allowed to operate in a regulated market, and no real grassroots drive to make it happen.

Other than efforts by Amaya/PokerStars and the PPA to promote regulated online poker in California, politicians, players and even the stakeholders themselves appear fairly blasé about the whole thing. Assemblyman Mike Gatto, who introduced online poker legislation last year, said that out of the thousands of emails he receives each week, only a handful concern online poker; while tribes opposing the inclusion of racetracks and bad actors in future legislation contend that it would be better to have no bill than a bad bill.

Consequently, even if the “Internet Fantasy Sports Game Protection Act” makes it all the way through to the statute books, it is unlikely to have any impact on the progression of regulated Internet poker in California – and the calls for California iPoker action will fall on deaf ears once again.

Jacqueline Packett
Jacqueline Packett