Something Special for Online Poker

At first glance, you might think Jim Kasper is nothing special. He's a middle-aged, middle-class guy from the Midwest with a wife, Sandy, and a couple of teenage boys. Upon seeing him, you'd guess he is an insurance man from a small city. He's a hard-working, roll-up-your-sleeves chamber of commerce kind of guy who gets involved in all kinds of civic projects in his hometown. And you'd be right, except for one thing: Jim Kasper is something special, particularly in regard to online poker.



Jim is the man behind the effort to legalize Internet poker in the state of North Dakota. A longtime Republican worker-in-the-trenches and local fundraiser in a very Republican state, he's been a member of the North Dakota House of Representatives since 2000, where, among other things, he serves on the Industry, Business & Labor Committee, which supervises regulated industries.



Jim's a nice guy and smart – and he has a vision for online poker. Even my buddy John, who doesn't talk to Republicans much anymore, is impressed by Jim. After five minutes of knowing John, Jim pegged him as a Key West-type liberal Democrat – and he was dead on. As I said, the guy is smart. The important thing about Jim, though, is that he has a vision for the future of online poker that very much serves the interests of the game.



I have repeatedly over the past few years called for the creation of some sort of national poker association that brings the biggest and smallest entities in the game together to serve the best interests of the game. No matter how loudly I've beaten that drum, nobody with any power has listened. Of course, the fact is, I was naïve. Why would people who profit from the existing business model have any interest in changing it?



And yet, the current business model is flawed, especially from the point of view of the player. When it comes to online poker, many who play and most who have never played share some concerns: Is the game fair and honest? Is the game legal? Is their money safe? A national association could go far to ameliorate people's thoughts on these issues. But, obviously, a meaningful, all-inclusive central authority to govern the game is not going to be established anytime soon. So – are we just out of luck? Is there no hope for universally accepted policies and procedures that serve the best interests of the game and protect the players?

Jim Kasper

We are not out of luck. We have Rep. Jim Kasper, and his nose-to-the-grindstone work ethic, creative imagination, and just enough clout to change things. In 2005, Jim sponsored legislation that would have legalized online poker in North Dakota for any online poker room that based its servers there, allowing them worldwide access from an American base. His bill passed the House but got creamed in the Senate, when the Department of Justice sent a letter to the North Dakota attorney general stating that online poker "may" be illegal pursuant to The Wire Act – an issue that others and I have addressed at length. Most legal experts – and Rep. Kasper – believe the Department of Justice is posturing and has no valid grounds to object to the game. Of course, battling the United States government on this issue is an incredibly expensive and time-consuming proposition.



The benefits to the online poker industry of having licensed, legal, regulated poker in the United States through North Dakota sites would be enormous. Advertising – television, click ads, the U.S. mail, and more – could proceed unhindered by legal issues, substantially increasing the number of online players, both in the United States and worldwide. EFT, PayPal, and credit card transactions would unquestionably be legal, and would significantly increase the flow of money into the game. Uniform standards for integrity could and would be enforced. Standardized parameters for random shuffles would be instituted, addressing the mostly unfounded concerns of many online players. Criminal penalties and forfeitures of deposits could be imposed upon online cheats. Age restrictions could be more effectively enforced. There would be a meaningful forum for redress of player grievances, somebody with authority to make meaningful rulings in disputes between players and sites, and even between players and other players.



North Dakota is uniquely positioned to take the leadership role on this issue, because it is the only state that owns its own bank: The Bank of North Dakota. This is a pretty big advantage, according to Kasper. Requiring all transactions to run through the state-owned bank, which is not regulated by the FDIC, of course creates a great profit opportunity for the state. It also has the value of assuring players that their money is someplace safe, with the state government protecting their deposits and their interests. Player deposits would be insured! This also would ensure that online poker accounts would not be used for money laundering, which is one of the biggest objections the Department of Justice has to Internet gaming of any kind.



Rep. Kasper is working on bringing back his proposal in the form of a statewide referendum in November 2006. To put the issue on the ballot requires approximately 36,000 signatures of North Dakota voters. It also requires financing for a campaign to educate North Dakota voters on the issues. The proposed initiative would provide that 80 percent of the revenue to the state be applied to lowering state property taxes, a provision that's sure to appeal to voters. It would require the online companies to locate their servers in North Dakota (undoubtedly improving the quality of connections and reducing time-outs, traffic-generated list problems, and so on) and operate their businesses out of the state. Rep. Kasper said, "I believe that if the Internet poker industry gets involved, without a doubt the initiated measure will pass in November 2006."



Of course, that is part of the problem. Big industry players aren't interested in opening up access to the business to prospective new competitors, preferring to protect their piece of the pie. Casino interests oppose any expansion of Internet gaming. (There's a proposed law circulating in Nevada that provides for servers to be based there – but only if a company owns a hotel with 600-plus rooms in the state.) Since The Wire Act most likely applies to sportsbooks, poker sites affiliated with them would have to divest or otherwise legally separate themselves from them, and lose the synergy of their feeders. The same applies for affiliations with other non-poker online gaming ventures. A whole host of gaming interests would perceive their businesses to be threatened by legal online U.S. poker. Rep. Kasper's proposal is not a slam-dunk, by any means.



Many industry players, however, understand that the long-term benefits of Kasper's North Dakota initiative would serve the best interests of the game – and their businesses. Success by Kasper would open the door for other states to legalize, although they would not have the additional inducement and regulatory advantage of a state-owned bank.



Various proposals have been floating around Georgia, Illinois, and Texas, which would pick up steam in the wake of a North Dakota victory. Furthermore, should the ballot initiative pass, the North Dakota attorney general will be taking on the Department of Justice over The Wire Act, which would serve all online poker interests.



The interests best served by the passage of the Kasper proposal would be those of online poker players across America, and, indeed, throughout the world. The regulated integrity and insured deposits alone make his plan a gigantic win for all players.



So, what can you do to help? You can contribute to the campaign. E-mail Rep. Jim Kasper at [email protected]. Even $5 will help, although, of course, the bigger the contribution, the better. Heck, if you've got some time on your hands next fall, you could spend a week or two of your vacation in North Dakota, volunteering on the campaign. Rep. Jim Kasper is indeed a special guy. He may be the savior of online poker!



As an aside, I will be speaking about integrity and collusion at River City Group's online poker show in Nassau, Bahamas, Dec. 8-9, "I-Gaming In Depth: Online Poker." My writing partner, John Bond, will be on the show's legal panel. Most major industry players will be there, including Jim Kasper. This may be one of the most important conferences in this young industry's history. You can get more info at http://www.rivercitygroup.com/ipoker/2005/.

Roy Cooke played winning professional poker for more than 16 years. He is a successful real estate broker/salesperson in Las Vegas. His books are available at http://www.conjelco.com/. His longtime collaborator, John Bond, is a freelance writer in South Florida.