New tactic in war on online gambling

St. Paul resident Chris Wallace said he makes about $2,000 a week playing poker online, enough to support himself, his fiancée and his dog. He's not about to stop, even as Minnesota officials take new steps to try to crack down on online gambling.

"I have e-mailed the Justice Department, and I've volunteered to be arrested," said Wallace, 35, who left college because online poker was taking up so much of his time. "I play online poker. Come and get it."

The state of Minnesota wants to do just that. A division of the state Department of Public Safety that enforces gambling and alcohol laws said Wednesday that it has instructed 11 national and regional telephone and Internet service providers (ISPs) to block access by all Minnesota-based computers to nearly 200 gambling websites.

Minnesota, citing a 1961 federal anti-gambling law, says all online gambling within its borders is illegal, even if the games are hosted outside the United States.

"We are putting site operators and Minnesota online gamblers on notice and in advance," says John Willems, director of the state's Alcohol and Gambling Enforcement Division. "State residents with online escrow accounts should be aware that access to their accounts may be jeopardized and their funds in peril."

But Twin Cities attorneys specializing in Internet law are skeptical about whether Minnesota could use that law to force the blocking of gambling websites. `

"This is an old law put in place before the Internet, and there may be an argument that it doesn't cover Internet service providers," said David Axtell, an attorney at Leonard Street and Deinard in Minneapolis.

Fleming said the state's anti-gambling law doesn't explicitly forbid Internet gambling, but state officials have interpreted it to mean that games offered over the Internet to Minnesota users fall under Minnesota gambling laws.

The legal theory is that "the Internet carries you into the state," he said.

Written notices from Willems' division were served Monday to AT&T Internet Services, Charter Communications, Comcast Cable, DirecTV, Dish Network, Embarq and Sprint/Nextel, Frontier Communications, Qwest, Verizon Wireless and Wildblue Communications.

Representatives of Qwest, Comcast and AT&T said they were studying the written notice from Minnesota and had no comment yet.

Willems said the state is acting even though he has no idea how much Internet wagering is going on in Minnesota.

He did say he has anecdotal evidence that Internet gambling "is fairly large" in Minnesota, noting that Canterbury Park in Shakopee has said that its casino-style games have been hurt. "Also, I've had people call me and say they've lost $20,000; can I help them? I can't."

The national perspective

Minnesota now joins at least one other state that has taken on Internet gambling, according to a national trade group that favors legalization of online betting in the United States.

Kentucky is trying to seize the domain certificates of 141 online betting operations, effectively shutting them down in that state, said Joe Brennan, chairman of the Interactive Media Entertainment & Gaming Association. However, his association won a stay in court that temporarily blocks the seizure effort while Kentucky takes its case to the state Supreme Court.

In New Jersey last year, a federal judge determined that the association failed to show sufficient cause to order her to block enforcement of the Unlawful Internet Gambling Enforcement Act, passed by Congress in 2006. That act doesn't specifically block Internet betting but bars U.S. financial institutions from handling transactions involving online gambling.

'The people want this'

Brennan said his association's mission is to promote online wagering that is regulated and taxed.

"The people want this," Brennan said. "What people are doing in the privacy of their own home should be protected. The combination of technology and consumer demand is outstripping our laws."

Matt Werden, Minnesota's director of a leading online poker advocacy group, said the state's effort "is a clear misrepresentation of federal law, as well as Minnesota law, used in an unprecedented way to try and censor the Internet."

Werden, whose Poker Players Alliance claims more than 1 million members nationwide and more than 21,000 in Minnesota, added, "We're calling their bluff. ... The PPA will take any action necessary to make sure ... the game of poker -- in all its forms -- is protected in the state of Minnesota."