A number of arguments between interested parties have prevented California from passing an online poker bill for the last 7 years. One issue, vehemently supported by the Pechanga Coalition, is that they don’t believe ‘bad actors‘ with ‘tainted assets‘ – namely PokerStars – should be allowed to obtain a license.
Assemblyman Adam Gray has been pushing hard for passage of his sponsored AB 2863, the Internet Poker Consumer Protection Act, scribing numerous amendments to coerce support from the split parties. His latest amendment came on Monday in the form of a 5-year ban on all so-called ‘bad actors‘, including those with ‘tainted assets‘. However, that ban would be revoked at any time pending payment of a $20 million penalty.
Gray’s attempt to assuage the Pechanga Coalition – a group of more than half a dozen influential tribes who oppose the participation of PokerStars, as well as California’s horse racing tracks, in a regulated online poker market – obviously wasn’t enough.
Chris Krafcik of Gambling Compliance obtained a copy of a letter sent to Assemblyman Gray by the Pechanga Coalition in which they verbalized opposition to the newly amended online poker bill. Following a brief acknowledgment of the Gray’s recent alterations, Pechanga wrote:
“Unfortunately, the June 27 version of the bill does not resolve our fundamental suitability-related concerns. However, we offer the attached amendments that would…”
Pechanga’s Suggested Amendments
The suggestions included an irrevocable 10 year ban from obtaining a license for any operator that accessed the US market following enactment of the UIGEA of 2006 (I.e. ‘bad actor’. Such terms would include the assets of any operator that violated the UIGEA, as well (I.e. ‘tainted assets’), meaning that PokerStars acquisition by Amaya Gaming in 2014 would not be enough to disqualify them from the obligatory ban.
The 10 year ban would commence on the day California accepts it’s first online poker wager.
“We note that this represents a significant concession from our longstanding position of permanent disqualification of assets used in illegal activities and provides a pathway for offshore service providers to access the California market,” said Pechanga.
Furthermore, once the ban expires, the coalition advised that a mandatory penalty of $60 million should be paid to the Internet Gaming Enforcement Fund by any such operator before it’s deemed eligible for a license.
Lastly, the letter recommends instituting a “non-severability” provision that would prevent any lawsuit from being filed that would overturn “critical suitability and eligibility requirements of this bill.”
Essentially, they left no possible avenue for PokerStars to access the California online poker market within 10 years of it’s launch, or without paying the $60 million fine.
No Online Poker Without Pechanga Support
Pechanga made it clear that, should the suggested language be amended to Gray’s AB 2863, they would fully support the California online poker bill. However, the current legislative session just went on break, and will not reconvene until July 31, 2016. At that point, only a single month will remain to get AB 2863 passed into law.
With such little time, it would certainly seem that, if Gray doesn’t acquiesce to the Coalition’s demands, there’s simply no hope left that the measure will pass this year. Even if he does alter the text to include the tribal group’s advisory language, and the House approves the bill, it doesn’t mean the Senate – who’s been tight-lipped on the subject of online poker all this time – will look favorable on the legislation.