AGA Withdraws Support for Online Gambling

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AGA American Gaming Association Geoff Freeman
AGA president Geoff Freeman speaking at G2E on Sept. 25, 2013. The AGA withdrew support for online gaming in the US after a wide split of opinions among operator members.
(Image: David Becker/LVR-J)

As the months roll on and talks continue, common ground has yet to be found on the subject of online gambling in the United States. The myriad of states, casinos, organizations and individuals on each side of the argument are firmly planted in their beliefs on the matter.

When such a sweeping decision is to be made, it makes sense to have the best of the industry rallied for the cause. But now the movement hoping for regulation in the US has lost one of its biggest supporters yet.

AGA Bows Out

The American Gaming Association has withdrawn their support for the legalization of online gambling in the US. According to a report by The Wall Street Journal, the decision was made due to the highly divisive nature of the issue between the largest casino operators in the country.

In an interview, American Gaming Association chief executive Geoff Freeman said this heated disagreement between casinos is “an issue that the association cannot lead on.”

With Delaware, Nevada and New Jersey being the only states to have a system of legalized online gambling in place, many companies such as MGM and Caesars have pushed for an expansion of the market.

A Market Divided

Despite its limitation in the US, online gambling has been a highly profitable industry across the world. Freshly legalized New Jersey was thought to have the potential to meet those multibillion dollar expectations, but technical issues and payment problems have interfered with momentum.

On the other hand, Las Vegas Sands CEO Sheldon Adelson and Wynn Resorts’ Steve Wynn have openly expressed their disdain for an increased online presence in the states. Adelson, one of the richest and most vocal of this side of the debate, says online gambling is harmful to society. The Las Vegas Sands also sees a large part of its profits come from foreign markets such as Macau.

Change of Heart

“One of the things I’ve learned in this industry is we are extraordinarily competent at shooting at one another,” said Freeman in his WSJ interview. And though the AGA’s reason is a good one, it’s quite a different stance than the one the group established a few years back.

In 2011, the AGA put their full support behind legalization efforts in the US. Shortly after the events of “Black Friday” on April 15 where the Department of Justice shut down three major poker websites, the AGA took to Washington D.C. to plead the case for a bill that would legalize online poker. The AGA’s argument was that over a thousand foreign sites were still taking online bets from American players. The association argued that these websites had systems in place to fend off money laundering, underage gambling and other illegal activities.

Freeman also submitted written testimony to the House of Representatives in December 2013. His testimony further advocated the legalization of online gambling saying that prohibition only drives players into black markets and profits offshore.

“Make no mistake: online gaming is here to stay,” said Freeman in his testimony. “The government cannot put the Internet back in the bottle.”

To the AGA, it seems as if trying to get casino operators and other groups to reach common ground is a futile effort, unlike keeping players away from online gambling. The association says it will instead shift its efforts to less combative causes, like the US Treasury Department’s issues with possible money laundering at casinos.

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