Rep Raskin Inquires About Adelson Role in New Wire Act Interpretation
During Friday's contentious House Judiciary Committee's oversight hearing with testimony from Acting Attorney General Matthew Whitaker.
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At one point, Democratic Representative Jamie Raskin of the 8th District of Maryland asked what role, if any, did GOP megadonor Sheldon Adelson have in getting the U.S. Justice Department to reverse its decision as it applies to online gambling.
Whitaker claimed he had not spoken to Adelson, a fervent critic of online gambling expansion in the United States.
A legal opinion from the U.S. Department of Justice made public Monday January 14, 2019, but written some months earlier, applies a 1960's Wire Act law to all forms of Web gambling. It was originally intended for sports betting and applied specifically to bet transmissions via land-line telephones across state lines.
The opinion, which appears to have come just days before Jeff Sessions resigned as Attorney General, marks a reversal for the department, which under the Obama administration in 2011 said online gambling within states that does not involve sporting events would not violate the federal law.
The 2011 opinion opened the door for cash-strapped states and their lotteries to bring online gambling to their residents, as long as it did not involve interstate sports betting.
Raskin's state of Maryland is among those exploring legalized Internet sports betting. Industry experts fear that the new opinion could negatively impact payment processing beyond state lines.
While states that currently offer sports betting and online poker do not permit gambling beyond their own borders, most sports wagering companies do offer out-of-state payouts to non-residents who have won money while visiting their resepctive venues. States like New Jersey, for example, see vast numbers of gamblers coming in to place bets at sportsbooks in the Meadowlands and Atlantic City from neighboring Pennsylvania and New York. Furthermore, payment processing companies tend to operate outside of these states in some capacity.
For his part, Raskin specifically asked Whitaker about his relationships with anti-online-gambling groups and casino interests. Whitaker claimed he was recused at the time of the DOJ opinion reversal.
He stated: “The first OLC opinion that preceded the one we just issued in November was done — and the state of Illinois provided a white paper regarding the position on the Wire Act. So I think it is very consistent, and your inferences on how that process was corrupted or corrupt is absolutely wrong. And the premise of your question I reject.”
The reversal of opinion also threatens state lotteries.
Rep. Doug Collins (R-Ga.), whose state is tradionally unfriendly towards most forms of gambling, told Online Poker Report last month:
“While the Department of Justice has updated its opinion on the Wire Act, the move shouldn’t put the Georgia Lottery or its investment in local students at risk. I believe that states still have the ability to regulate gaming within their own borders, and I’ll keep working to make sure that Georgians’ right to make these decisions for themselves isn’t curbed.”
- Gilbert Horowitz, Gambling911.com
