The Unlawful Internet Gambling Enforcement Act (UIEGA) passed in late 2006. This law was piggy backed into the security port act and signed by president Bush into law. This law has nothing to do with national security, but what it has done is create an online poker cartel.

The hands that own and operate online poker are now much fewer thanks to the passing of the UIEGA. The law basically makes it illegal for US banks to process online gaming transactions. It does not make it illegal for US citizens to gamble online.

Many people and affiliates of online poker were very confused about the law and its repercussions.  Many gaming and poker sites pulled completely out of the US market when the law passed. Virtually every public company pulled out as well. Party Gaming who owns Party Poker stopped taking US players virtually overnight. They went from the largest online poker room to a medium sized poker room with the flick of a switch.

Several private companies decided not to pull out of the US market. One of these companies is Poker Stars. Poker Stars is privately owned and before the law passed, they were a medium sized poker room. When they decided to stay in, and many poker sites pulled out, they became the largest online poker room almost overnight.

Is this just a coincidence that one law change crushes many US player poker sites and greatly helps out just one or two? I think not. The UIEGA also allowed online poker and other gaming rooms to steal billions of dollars overnight. How is that?

Most of these poker rooms stopped taking US players, and US affiliates. Affiliates are responsible for bringing in nearly half of ALL of the revenue from online gaming.  Affiliates are paid a bounty, or a percentage of revenue by the online poker and gaming sites.  Some of the top affiliates were making residual income of over $500,000 a month from these online poker and gaming giants.

When the law passed, many of the gaming sites said something to the effect of this. Oh, were sorry, but because of the new law, we can no longer keep you as an affiliate. Oh yeah, we won’t be paying you any further commissions on the millions of players you brought us. Sorry.

Whenever a law changes, all you have to do is follow the money. When you have a market that is billions of dollars a year huge, it’s not run and controlled by idiots. It is controlled by the most elite and ruthless people of the world.

There has NOT been one poker site to be indicted by the US government for taking US players.  It is not a matter of if, but when the law will be changed. Online gaming in the US will become regulated like everything else in this country.

To give you an idea how absurd this law is, look at Doyle’s room. Doyle Brunson who is a Nevada State resident, openly promotes his online poker room.  He is a US citizen and he gladly takes US players and their deposits.

There are talks going on right now between land based casinos and internet gaming sites. Many companies are going to merge and they are patiently waiting for the law change before acting on further consolidation.

The UIEGA law has not reduced online gambling. Not one bank, nor gaming site, nor individual gambler has come under any indictment or prosecution by the US government in regards to online poker. Online gambling continues to still grow. The US still makes up the largest percentage of online gamblers in the world combined. What has happened is that the rich just keep getting richer. That is virtually the only reason laws are passed in this great country the USA.

The house always wins and that’s the best way to leverage yourself when it comes to gambling. The internet is an amazing tool. Who thought people would be able to gamble from their home 24 hours a day?  Who ever thought they could own a casino online? 

Here’s to the future. I am looking forward to my passion and interest of owning a successful online casino coming to fruition. It is such a better feeling to be on the other side of the fence not having to grind away for hours at the tables hoping to make a few bucks.

The online gaming industry has created Multiple Billionaires. Take Ruth Parasol, founder of Party Poker. When her company went public, she made an additional $683 million overnight.  Then, there is Calvin Ayre, the founder of Bodog. Bodog takes hundreds of millions of dollars in sports wagers each year.

There is a shroud of mystery around the legality of online gaming. TheUnited States government has intervened and tried to police the world. The interesting thing to note is that there are many variables to setting up and doing business as an online gaming company.

US citizen or not, US company or not, the US government has indicted a small percentage of these companies, and only if these companies have violated “certain” rules deemed to be laws.

Since day one,  US citizens have made up most of the online gaming revenue globally. In the past few years however, things have started to change. Regardless of recent US law changes, US players haven’t slowed down with gambling online. Online gaming is still growing fatser every day. we can thank broadband expansion on a global basis. Citizens from other countries  are starting to gamble online. This is possible because high speed internet is working its way everywhere.

If every US gambler stopped placing wagers online today, the industry would still grow at an accelerated rate. What’s even more interesting, is that NO US Citizen has ever been prosecuted by the US government for gambling online.  

Thanks to client language software (software that displays different languages), it is now realistic to market online gambling successfully around the globe. You can legally own and operate an online casino even if you are a US citizen. You can have a casino, poker room, and a sports book, providing that your customers are outside of  the United States and are NOT US citizens.

There is a chance that the US law against online poker will actually be repealed. You can learn more about that by looking into the UIGEA repeal ACT to be held on September, 26^th, 2007.  The government will never go after poker rooms due to the public unrest involved against the law. There are five very large and successful poker rooms that take US players. They promote their poker sites all over television with US poker celebrities as their endorsers. Poker Stars, Ultimate Bet, Full Tilt Poker, Absolute Poker, and Doyles Room are quite bold.  Doyle Brunson. (founder of Doyle’s Room) lives in Nevada and the feds aren’t hauling him into prison. The US government has only gone after sports books. The US government has only gone after processing companies that  process the sports books deposits/withdrawals.

If you ever wanted to get involved with the online gaming industry and you happen to be a US citizen, you could play the “game” extremely safe by NOT  taking wagers from US players.  The US governement  will probablt never go after poker sites, but better safe than sorry.

Over half of the online gaming market is now outside of the US. This is a $20 billion dollar a year industry. You can legally get a piece of this as a US citizen.  It’s not too late to become wealthy in this industry. Its’ growing every day and will continue to do so through 2012.

Starting a poker room isn’t that difficult providing you have player liquidity. You need enough players to have diversity of available poker games. This can be ensured by joining one of the larger poker networks whom have 20,000+ poker players, on their poker network at any given time.

Online poker is a $6 billion dollar a year industry.

The top poker rooms are making over $1 million dollars every day online.

The top poker affiliates make over $150,000 a month.

Let’s say you want to start your own poker room. You get on the the search engines and before you know it, you find two dozen or so companies that claim to be competent to help you. You don’t get something for nothing and you understand  their fees range from $100 up to a couple of million. You know you get what you pay for, so you start weighing the postives/negatives for these companies.

On the bottom end, you can get a website that is 99% replicated, and all you have to do is advertise it. When players sign up to play poker,  your website receives a percentage of the revenue that their play generates. In other words, you are basically an affiliate with little or no control of anything else. Except of course for limited marketing with the business. (Due to duplicated web content restrictions). On the high end, you can drop $1-$5 million dollars on fully created and customized gaming software. This will be created from scratch to match ALL of your needs. So, you’re out $1-$5 million and one to three years have passed while you waited around for the software to be finished. Now, it’s done and you are ready to start marketing and advertising. Once your marketing is ready to go, you need to hire at least 500 player props to play poker at your site. This is so your first 10 poker player customers have someone to play poker against. This is the hardest part when trying to reach and maintain the player liquidity.

Option C is to join a poker network. Contact several of the larger successful poker networks and you will find that they are very selective. You must know the gaming industry well, have a strong business background, and have a promising business plan for them to tear apart.  You will naturally have to pay them a royalty percentage of all revenue that your game players generate. They can set you up  within 6 months to a year  and provide somewhat customized gaming software.  They can instantly provide you with player liquidity. This means when your first 10 poker player signin to your poker website, they get pooled in with the other poker players from all of the poker rooms on the network. It typically costs about $200k-$1m to get started and the network will  want to see an operating/marketing budget  $2million+.

I found Option D.  I received a phone call from a sales rep at Future bet. I was given a professional and credible presentation. I verified some of their claims and became quite impressed. They claimed to be the only connection to the Poker Network. If you wanted to be a poker site on their Network, you had to go through them. They claimed to have been affiliated with Poker Room. Poker Room was the first official online poker website. They claimed to have a “special relationship” with the network that allowed them to offer a lower point of entry cost.. They proposed to build us a custom designed website which would be integrated into their network for $50,000. This would include access to their gaming license (a $50,000 additional value) because our website would be placed under their license. There would also be a royalty scale of roughly 8%-21% depending on monthly rake revenue. 

This sounded great.  we were going to receive a mostly custom poker website, have our poker room connected to their network, (providing instant player liquidity, pay them a small royalty commission, utilize their customer service for our player support, be able to tap into their processing for our player deposits/withdrawals, resulting in a Turn-Key poker business.

I raised $200,000 to get started. I met with the president of Future Bet Ron Katz) from Vancouver, Canada. I gave a check for $57,5000 and then waited for a few months patiently while our poker website mock-up was to be completed. I had made several additional customized website requests. They were very reasonable requests . I then received a call about three months later informing me that our site mock-up was done. When I viewed the mock-up, I was very un impressed, but it seemed like we were getting somewhere. None of our customized requests were completed. I was told that the requests would take additional time. I was assured they would be completed soon. I was then literally “threatened” to accept the site “as is” or it would be put to the bottom of the pile. we would have to wait several more months before the changes could be made which.  This would drastically delay the launch. Future Bet said this was due to other licensees sites still needing to be finished.

I reluctantly agreed and within three days, I had referred many people to our new poker site. It wasn’t close to perfect, but  figured it was good enough to get started. On the fourteenth day of launch, I recei ed an email from a player I signed up. He had won just over $2k. He had requested his withdrawal, and after a week, he was notified that the maximum payout was $2k per week.  He was told he would have to re-request his deposit in $2,000 increments. It would take a total of 10 weeks to get his money out. This was just the beginning. I got another phone call explaining that because of our large number of deposits (great news), we had to personally guarantee those deposits. Future Bet demanded an additional $15,000 reserve to be sent within one week or our poker site would be turned off.  we originally paid a $5k reserve. I reluctantly sent the money. Their story was somewhat convincing.

They said they weren’t our bank and we would be responsible for “floating” all deposits and withdrawals which could take up to two weeks.                                                                                                                                                            

This was another “red flag”.  I kept asking myself why wouldn’t this billion dollar empire float a lousy $15 -$20k for a two week period to cover the deposits. A short while later,  I received several more emails from clients and friends of mine who hadn’t received their cash out request from our poker site. These cash outs requests varied from a few hundred to a few thousand dollars. This made no sense as we had now paid $20k total in reserves to cover and float these deposits/withdrawals.

Ron Katz gave me every reason why these things were happening. I was assured again and again that these problems would be fixed. After a few weeks players started informing me that they had started to receive some of their withdrawal requests. Things went smoothly for about a month. I received amother phone call from Ron katz explaining that he had an incredible marketing campaign in the works that only happened once a year. It was the most effective marketing Future Bet had ever found Ron boasted.  If we wanted a piece, we could get in for only $12,000. I was guaranteed of its effectiveness. I wired the money and the campaign NEVER went out.

The problems only got worse. I started receiving more emails. This time from other licensees asking if I had received any payouts from Future Bet. Come to find out, some of the licensees hadn’t been paid in months. we had never requested a payout from them because we never put much any money into marketing other than the $12,000 Future Bet stole from us. (Thank God) Needless to say we managed to lose over $100,000 with Future Bet. They lied about many of the representations they made. As it turns out, you can have a direct relationship with the OnGame Network without going through Future Bet. Why would OnGame even allow Future Bet to represent them? OnGame finally gave Future Bet the boot onve the problems really started to get out of hand. Future poker site operator beware of Future Bet.

The largest networks are OnGame and PlayTech. OnGame hosts Poker Room.com, Hollywood Poker, Bwin, Chan Poker, EuroCoral Poker and many more. PlayTech is known for Titan and Noble Poker.com.  Euro and Coral  Poker were originally part of the Party Poker network. Party Poker kicked them off when they realized their software was running out of room to handle ALL of the players.

The online poker market is a $6 billion dollar industry. Online gaming will be a $24 billion dollar a year industry within the next few years. There have been some recent laws banning gaming in the US, but thanks to key broadband expansion on a global basis, these figures will hold true regardless of whether or not the US is allowed to be a part of the market. US citizen or not, it is legal to own and operate an online gaming site at the federal level. Certain restrictions apply in eleven states. Until the US law changes, you don’t want to take US players. There’s plenty of other countries out there that you can legally sign players up at. None the less, there are many businesses cashing in as a result of online poker and gaming. ]]> http://www.pokerroomstartup.com/online-poker-still-growing-strong/feed/ http://www.pokerroomstartup.com/is-online-poker-illegal-in-the-us-what%e2%80%99s-really-going-on/ http://www.pokerroomstartup.com/is-online-poker-illegal-in-the-us-what%e2%80%99s-really-going-on/#comments Fri, 07 Sep 2007 09:41:55 +0000 admin http://www.pokerroomstartup.com/poker-resources/is-online-poker-illegal-in-the-us-what%e2%80%99s-really-going-on/ There are some confusing things going on in the world of online poker.  Let us identify what the current US gaming law is really about.  The only concept that is currently illegal in the US in regards to online poker has to do with financial institutions (banks).  It is now illegal for banks and processing companies in the United States to process transactions related to the online gaming industry.  An online gaming site owner/operator could also be charged with aiding and abetting. A U.S. poker player has never been prosecuted for playing online poker.  There are five large online poker rooms that still take bets from US players. Those rooms are Full tilt Poker, Poker Stars,  Bodog, Absolute poker, and ultimate Bet. These poker rooms endorse player celebrities that you ee all over your television set .  Chris Moneymaker, Joe Hachem, Jamie Gold, Phil Ivey, Howard Lederer, are just a few. These poker rooms are private companies, not public and it helps them to avoid public scrutiny.

I am playing poker on Bodog right now as I am creating this article. I successfully used my MasterCard card to make a deposit. The transaction was instantly approved by my bank. My bank is in the US and is called US Bank. Maybe we should report US Bank to the government. Just kidding.

The UIGEA poker ban passed on October 13^th, 2007 has had very little impact on US online players.  The online poker market has been consolidated into the hands of a few wealthy people and companies. Online poker rooms continue to grow and rooms like Poker stars have grown by several hundred percent or more overnight because they still take US players.

Online poker isn’t going anywhere. It is a 6 billion dollar a year industry, and the US market only accounts for about 50% of it. Regardless of the US poker laws, there is no Federal Law making it  illegal for a US citizen to play poker online. There are 11 states that have laws against it, so you should check those laws in your jurisdiction first.

It is also possible for a US citizen to own a piece or ALL of an online poker room legally.  The poker room should simply NOT take US players.  No US players means NO potential problems. The highly awaited UIGEA court hearing to repeal the US poker law has been postponed  to September 26^th 2007. The case is being filed by iMEGA. The defendants  are the U.S. Department of Justice, the Federal Reserve Board, and the Federal Trade Commission. The  defendants have asked the court for more time to prepare their case.