Kendall James

As the Indian tribes presented at the California Hearing:The Future Public Policy and Fiscal Implications of Authorizing iPoker Gaming in California a press release was sent out announcing the partnership of the three largest card clubs and the Morongo Band of Mission Indians.

The first paragraph in the Press Release:

The Morongo Band of Mission Indians, California’s (and the world’s) three largest card clubs – the Commerce Club, the Hawaiian Gardens Casino and the Bicycle Casino – and The Rational Group, which owns and operates PokerStars, announced today that once California enacts legislation authorizing intrastate online poker, PokerStars will serve as the subcontractor providing the online poker platform and related services for a real-money online poker website to be licensed, owned and operated by an entity owned by the Tribe and the card clubs.

In the short term, the agreement is primarily a lobbying effort by the Morongo, the card rooms and PokerStars to prevent a bad actor clause from being included in any potential online poker legislation. At present, both California bills include such a clause that would effectively ban PokerStars from participating in an regulated California market.

According to the press release, the coalition has established a set of guidelines that they believe should be followed by legislators in legalizing online poker. They are:

  • Extend California’s Strict Consumer Protections and High Standards of Accountability to Intrastate Real-Money Online Poker.
  • Ensure that California and Californians Benefit From State-Authorized Online Poker.
  • Require Stringent Regulatory Vetting of Operators and Subcontractors Before Authorizing Licenses, Using the Same Proven Statutory Suitability Criteria that Have Served California Well for Nearly Two Decades.
  • Reject Attempts by Special Interests to Use the Legislature to Restrict Competition and Pick “Winners and Losers.”

Robert Martin the Chairman of the Morongo Band of Mission Indians in California heralded the coalition, stating, “We’re pleased to announce our agreement with these established and proven organizations that represent millions of California poker players. We’re confident that, together, we can offer a safe, secure, high-quality online poker experience that brings financial benefits to California while providing the highest level of accountability, choice, service and protection for consumers.”

Guy Templer, Group Director of Strategy and Business Development for the Rational Group was quoted, “PokerStars has a great history with California poker players, who want us in the market. We are the worldwide leader in regulated online poker and hold more national licenses than any other operator. We look forward to bringing our best practices in responsible gaming, online security, e-commerce, protection of players’ funds and game integrity to the California market.”

It is PokerStars’ history with California citizens that some lawmakers and other tribes are concerned about. PokerStars continued to operate in the United States following the passage of the UIGEA in 2006 and continued to do so until April 15, 2011. They were charged money laundering, operating an illegal gambling business and other UIGEA violations. The most damming pieces of evidence against the company included proof that the company and its payment providers blatantly changed gambling transactions to make them approved as legitimate purchases. This type of history makes some concerned that the company will continued similar “underhanded practices” in the future.

On the other side of the argument, the Morongo and the card rooms are arguing that tribes are trying to have the bad actor clause added to stifle competition. Many believe that PokerStars would dominate in a regulated online market due to their history, their superior gaming product and the finances to promote their product. If PokerStars were blocked, then tribes would be in a better position to compete.

Kendall James
Kendall James - Kendall has been covering the gaming industry for over 7 years. Kendall lives in San Francisco with his wife and black Labrador. Kendall often travels to Sacramento and Nevada to covers legislative hearings and iGaming conferences.