Preet Bharara seems to be haunted by the fear that someone, somewhere, may be playing poker. Last year, Bharara, the U.S. attorney in Manhattan, threatened an Australian payment processor with up to 75 years in prison for helping online poker companies do business with their U.S. customers. Last Friday, he announced similar charges against 11 people associated with the three leading poker sites serving American players.
If you type in the Web address for PokerStars, Full Tilt Poker or Absolute Poker, you will see a notice that the domain name has been seized by the FBI. The notice cites some impressive-sounding crimes, but the statutory language cannot conceal the legal weakness and moral triviality of Bharara's charges.
This is only the second time that the Justice Department has used the Unlawful Internet Gambling Enforcement Act (UIGEA) in a criminal indictment. That 2006 law made it a federal offense, punishable by up to five years in prison, for a gambling business to "knowingly accept" payments "in connection with the participation of another person in unlawful Internet gambling."
But the UIGEA glaringly failed to clarify what "unlawful Internet gambling" meant. Bharara does not claim online poker directly violates federal law, which prohibits the use of "a wire communication facility" to accept bets "on any sporting event or contest" but is silent on the legality of other online wagers. Instead, he piggybacks on a New York statute that makes promoting "unlawful gambling activity" a Class A misdemeanor.
In New York, gambling is unlawful if it is "not specifically authorized." But the law states that "a person engages in gambling when he stakes or risks something of value upon the outcome of a contest of chance or a future contingent event not under his control or influence, upon an agreement or understanding that he will receive something of value in the event of a certain outcome."
As a pretty poor but regular poker player, I can testify that it is not merely "a contest of chance"; it is a game of skill, like Scrabble or backgammon, in which chance plays an important role. That is the position taken by the online poker companies as well as the Poker Players Alliance, whose chairman, former Sen. Alfonse D'Amato, R-N.Y., declared on Friday that "online poker is not a crime and should not be treated as such."