Mike Gatto defends California Online Poker Bill in Op-Ed

On December 1st, 2014, Assemblyman Mike Gatto turned heads by introducing the first California online poker bill of the 2015 legislative session; something everyone expected to come from Assemblyman Reggie Jones-Sawyer. Since then, Gatto’s bill has been under the microscope, drawing criticism from all angles – as did every relative measure that came before it.

In response, Gatto published an op-ed on U-T San Diego defending his online poker bill and validating its most criticized component, satellite service centers. These centers would allow patrons to visit any licensed, land-based gambling destination in the state – even the small ones that litter the map – to make their first deposit. Large withdrawals, or withdrawals that exceed a given frequency, would also have to be made in person at a satellite service center.

Lawmakers in California have made attempts to legalize and regulate online poker for the last five years—starting well before the DOJ gave individual states the right to do so in December of 2011. Assemblyman Gatto pointed out the four major concerns that held the state back from passing, or even getting close enough to vote upon, an online poker bill:

“The first is that because gaming budgets are finite, online play would reduce visits to local “brick-and-mortar” gaming and hospitality establishments.
“The second concern is that small- and medium-sized operators would be unable to participate in the market, meaning that only big businesses would benefit.
“The third concern is that online poker would foster money-laundering and cheating.
“The final concern is that it could result in minors gambling, using the anonymity of the Internet.”

 

Gatto claims to have addressed each of those trepidations in his online poker bill, AB 9, Internet Poker Consumer Protection Act of 2015, by including satellite service centers. “Can policymakers address these concerns and secure much-needed revenue for California? I think so,” wrote Gatto, “and I am prepared to introduce legislation that does just that.”

He started by explicating the reason for satellite service centers, designed to protect consumers and maintain foot traffic in smaller businesses. “Just like opening a bank account, the only way to open an online-poker account in California would be to present yourself in person at a “branch” and be “validated” by showing two forms of identification… Initial deposits would occur in person, although subsequent ones could be made online. A similar rule would apply for cash-outs above a certain amount or frequency.”

Gatto said that his plan would, “greatly reduce the likelihood of a minor being accepted into the system,” and “weed out potential money-launderers, like those who walk in with suitcases of $100 dollar bills.” He went on to explain that, “it would allow local brick-and-mortar establishments, most which are too small to operate an online-poker site, to nevertheless profit from online poker, and would guarantee them some foot traffic.”

According to Gatto, the “most significant” feature of satellite service centers would be there ability to “greatly discourage cheating and other illegal schemes. If a gambler had just completed an elaborate cheat,” he explained, “would he want to show up in person and present himself to a security professional to collect his winnings?”

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