NY Concerned About Online Gambling ‘Bad Actors’

Posted on April 25th, 2013 by Todd Wilkins

NY Concerned About Online Gambling 'Bad Actors'A New York lawmaker voiced his concerns about illegal gambling sites and urged the New York State Gaming Commission to better regulate the industry.

Senator Tim Kennedy (D-Buffalo) is worried that the proliferation of legalized Internet gambling in states throughout the U.S. could lead to an increase of predatory and unlawful online gambling activity in the state of New York. In an effort to protect his constituency, Kennedy has called on the commission to investigate and prevent illegal websites from preying on New Yorkers.

Kennedy is especially concerned about neighboring New Jersey’s recent online gambling legislation, stating that there are companies who set up “virtual private networks” (VPNs) that allow residents in unregulated states to gain access to gambling websites. In other words, these illegal companies falsify the location of the gambler, making it appear that he or she is located within a regulated state such as New Jersey.

The New York Senator, who has a history of advocating treatment for problem gamblers, said that the technology involved in masking players’ true locations is quite simple and is used to prey on individuals who are prone to addictive behavior. Kennedy referred to the actions of the unlawful sites as egregious and would like to protect minors and those who have crossed over the line into gambling addiction.

Existing state laws offer no means of enforcement against illegal websites from targeting the New York market and also provide little recourse for citizens who may fall victim to these predatory tactics. Enforcing illegal gambling regulations has been handled by the FBI over the years, but the DoJ’s ruling in 2011 that found the Wire Act of 1961 to be applicable only to sports betting has shifted the burden of regulatory control to the state level.

With many states now considering various forms of online gambling legislation, the individual states must devise ways to safeguard and protect their citizens from the so-called bad actors. Kennedy stresses too that money spent by New Yorkers to gamble online is decreasing revenue at New York casinos.

States that have or are considering the enactment of Internet gambling regulations typically include language that addresses the need for consumer protections. New Jersey Governor Chris Christie would not sign legislation earlier this year until the bill was amended to allot more money to state programs to combat gambling addiction.

However, Kennedy is correct in his belief that the use of VPNs is widespread by illegal companies who allow players to play online from unregulated jurisdictions. Black Friday was orchestrated by federal authorities to wipe out illegal online poker in the U.S. Now that legalization is upon us, gaming officials from each state need to regulate the industry properly.

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