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Province trying to close online gambling loophole
Oct. 18, 2006. 01:00 AM
IAN URQUHART
<!-- icx_story_begin -->We've all seen the ads on television or heard them on the radio: A poker "star" boasts of his conquests and invites us to visit a website where we can gamble with play money.
"It's fun," says the poker star. "It's free."
But upon making the visit, we discover connections to the real thing: a website where we can lay down bets for hard cash, or credit.
It is through such manoeuvring that the website operators continue to find ways to attract new customers, notwithstanding the fact that gambling on the Internet, or advertising of same, is strictly illegal in Canada.
Accordingly, the provincial government plans to move to close the loopholes with a blanket ban on advertising of Internet gambling, direct or indirect.
The ban will be part of an omnibus consumer protection bill to be introduced tomorrow by Government Services Minister Gerry Phillips.
Phillips is essentially adopting, in government legislation, a private member's bill introduced earlier this year by Jeff Leal, Liberal MPP for Peterborough. Leal deserves credit for bringing attention to the issue.
There are good reasons for the government to take this step: Internet gambling is highly addictive because it can be played anonymously around the clock, and it is also accessible to underage players.
But, of course, the province has another reason to curb Internet gambling: It is cutting deeply into the government's share of the take from legal gambling at the casinos and race tracks.
It is hard to know exactly how much money is being drained away from legal gambling by the illegal sites on the Internet; estimates range up to $500 million a year in Ontario.
But this much is known: Revenues for the government-owned Ontario Lotteries and Gaming Corp. (operator of the province's casinos) were down $335 million over the past three years and is forecast to drop another $210 million this year.
Border-crossing problems, the high value of the Canadian dollar, and growing U.S. competition share the blame for this. But there is no doubt that Internet gambling is a factor in the steady decline.
Some argue that Canada should simply follow the lead of other jurisdictions (Britain, for example) and legalize Internet gambling, with governments either operating the sites directly or regulating and taxing them.
But there seems to be little appetite for this option among Canadian jurisdictions.
The Ontario government, for one, has categorically ruled out involvement in the Internet gambling business.
The next option, then, is to fight the scourge.
The problem is that, while illegal, Internet gambling is hard to police, as the sites are based either offshore (Antigua, for example) or, within Canada, at the Mohawk reserve of Kahnawake, outside Montreal.
The United States Congress last month found a way to get at the offshore sites by passing a bill that makes it illegal for American banks to allow their credit cards to be used for online gambling.
Such action is beyond the jurisdiction of a province, however, as Ottawa is responsible for both the Criminal Code and banking. So Ontario is focusing on advertising curbs for now.
But Phillips has written a letter to federal Justice Minister Vic Toews to express his concerns about Internet gambling and appeal to Ottawa to join the fight.
The letter, dated Sept. 28, has a plaintive tone to it as Phillips struggles to capture Toews's attention.
"The government of Ontario considers illegal Internet gaming to be a serious issue," writes Phillips.
"It is clear, however, that illegal Internet gaming represents complex regulatory challenges requiring a co-ordinated effort by provinces and the federal government on several fronts ... I would ask for your support and continued engagement on this issue."
Toews has yet to respond to the letter.
Somewhat surprisingly — given that the federal Conservative government often takes its cues from Washington — a spokesperson for Toews explains that Internet gambling is not a "priority" for the justice minister.
So, the websites will continue to operate with impunity in Canada, but the advertising of them may soon be a little more difficult, at least in Ontario.
A footnote: Phillips's omnibus bill will also contain sections dealing with real estate fraud, outlawing termination dates on gift certificates, and modernizing the provincial archives
Province trying to close online gambling loophole
Oct. 18, 2006. 01:00 AM
IAN URQUHART
<!-- icx_story_begin -->We've all seen the ads on television or heard them on the radio: A poker "star" boasts of his conquests and invites us to visit a website where we can gamble with play money.
"It's fun," says the poker star. "It's free."
But upon making the visit, we discover connections to the real thing: a website where we can lay down bets for hard cash, or credit.
It is through such manoeuvring that the website operators continue to find ways to attract new customers, notwithstanding the fact that gambling on the Internet, or advertising of same, is strictly illegal in Canada.
Accordingly, the provincial government plans to move to close the loopholes with a blanket ban on advertising of Internet gambling, direct or indirect.
The ban will be part of an omnibus consumer protection bill to be introduced tomorrow by Government Services Minister Gerry Phillips.
Phillips is essentially adopting, in government legislation, a private member's bill introduced earlier this year by Jeff Leal, Liberal MPP for Peterborough. Leal deserves credit for bringing attention to the issue.
There are good reasons for the government to take this step: Internet gambling is highly addictive because it can be played anonymously around the clock, and it is also accessible to underage players.
But, of course, the province has another reason to curb Internet gambling: It is cutting deeply into the government's share of the take from legal gambling at the casinos and race tracks.
It is hard to know exactly how much money is being drained away from legal gambling by the illegal sites on the Internet; estimates range up to $500 million a year in Ontario.
But this much is known: Revenues for the government-owned Ontario Lotteries and Gaming Corp. (operator of the province's casinos) were down $335 million over the past three years and is forecast to drop another $210 million this year.
Border-crossing problems, the high value of the Canadian dollar, and growing U.S. competition share the blame for this. But there is no doubt that Internet gambling is a factor in the steady decline.
Some argue that Canada should simply follow the lead of other jurisdictions (Britain, for example) and legalize Internet gambling, with governments either operating the sites directly or regulating and taxing them.
But there seems to be little appetite for this option among Canadian jurisdictions.
The Ontario government, for one, has categorically ruled out involvement in the Internet gambling business.
The next option, then, is to fight the scourge.
The problem is that, while illegal, Internet gambling is hard to police, as the sites are based either offshore (Antigua, for example) or, within Canada, at the Mohawk reserve of Kahnawake, outside Montreal.
The United States Congress last month found a way to get at the offshore sites by passing a bill that makes it illegal for American banks to allow their credit cards to be used for online gambling.
Such action is beyond the jurisdiction of a province, however, as Ottawa is responsible for both the Criminal Code and banking. So Ontario is focusing on advertising curbs for now.
But Phillips has written a letter to federal Justice Minister Vic Toews to express his concerns about Internet gambling and appeal to Ottawa to join the fight.
The letter, dated Sept. 28, has a plaintive tone to it as Phillips struggles to capture Toews's attention.
"The government of Ontario considers illegal Internet gaming to be a serious issue," writes Phillips.
"It is clear, however, that illegal Internet gaming represents complex regulatory challenges requiring a co-ordinated effort by provinces and the federal government on several fronts ... I would ask for your support and continued engagement on this issue."
Toews has yet to respond to the letter.
Somewhat surprisingly — given that the federal Conservative government often takes its cues from Washington — a spokesperson for Toews explains that Internet gambling is not a "priority" for the justice minister.
So, the websites will continue to operate with impunity in Canada, but the advertising of them may soon be a little more difficult, at least in Ontario.
A footnote: Phillips's omnibus bill will also contain sections dealing with real estate fraud, outlawing termination dates on gift certificates, and modernizing the provincial archives
