To help understand why the federal government banned internet poker, you should first understand how the sites work. Without droning on with details, I will attempt a quick summary. In order to start playing poker online, you first download the free software and install it. Once you have done this you can play for free or you can deposit money and play for cash. You play against other people from around the world. The sites take a small percentage of each pot. This is called a rake. This is the only way the site makes money. Once you have made some money, you may decide to cash out. The poker site then credits you the amount you wish to withdraw from your account.
The difference between an online poker site and a brick and mortar casino is simply one of convenience. Both provide you with a means to play poker against other real people. It just so happens that with the online casinos and poker rooms, you can do so from the comfort of your home or office. The federal government dislikes the online poker rooms because of one simple reason. They do not make any money from them. Not a cent. The fact is, all the mainstream online poker sites are run from outside the US. So they can not be taxed by the federal government.
What the Internet Gaming Law has done is to make it illegal for any merchant to either deposit or withdraw your money to these overseas poker sites. In fact, they have gone so far as to arrest the people who own some of these sites when they step on American soil. The hope is that the US government will scare these companies into shutting down. Sadly, this has started to happen. With the recent arrest of the two principal owners of the largest go-between site, NeTeller, when they arrived in New York two weeks ago. The site promptly stopped handling online casino transfers, and in fact stopped doing business with ALL customers in the US for any reason. This forced most of the smaller companies to also stop doing business out of fear of being arrested and held in the US.
So that would seem to be the end, right? Well not exactly. At this time you can still write a check, or send a Western Union to deposit into your online poker account. And when you are ready to take out your winnings, the sites will write you a check and mail it to you. As of today, the bank IS cashing the checks.
That brings us the the final question. What does the law hope to accomplish? Well clearly it wants to stop the untaxed flow of internet gaming revenue, which is estimated to be somewhere in the billions of dollars yearly. Plans have already been drawn up by a Las Vegas firm for a US based, completely taxable, legal, internet poker room. Now from what I have read and understand these US based poker rooms would only be allowed to be run by companies with a valid gaming license, i.e. established casinos. These are the SAME people who backed the Internet Gaming ban. A typical example of politics in this country. Special interest groups have more and more power everyday, and there isn’t much we can do about it.