I’m not a big fan of TikTok. My wife has shown me a few videos on the platform and it seems harmless to me, but I’ve never downloaded it or paid much attention to it. So, I pretty much ignored the news of a TikTok ban by the federal government until I heard about what is in the law. I should have seen it coming. People who write bills like this always try to sneak some extras in there, usually something shady they hope no one will notice. What I didn’t expect was that it might have a bearing on online poker.
I’m honestly surprised that there isn’t more alarm about the wide-ranging power in the bill and the ways it could be used. This bill is not just targeted at TikTok, and it could affect all of us, and in particular anyone who still plays online poker through an offshore site or any app that takes customers from overseas.
As a poker player who was burned badly by the UIGEA, a banking bill that was snuck into a port security act that was guaranteed to pass just minutes before the vote, I am once bitten twice shy on bills like this. The RESTRICT Act is definitely a concern, not only for our freedom, but for our freedom to play poker online.
As it stands now, a significant portion of the online poker market for Americans is on offshore “gray market” sites. These sites are in a legal gray area where it is likely illegal to run them, but not illegal to play on them. The owners of these sites are in jeopardy with the Department of Justice, but the DoJ doesn’t seem to be bothering with them right now because the cases might be tough to prosecute and the site owners are not typically within the United States.
The TikTok ban doesn’t just target TikTok
The first problem with the RESTRICT Act is that it can be used to target anyone that is deemed to be benefitting, working with, or under control of an adversary, and the determination of an adversary is murky and under the control of a few people that may have very different opinions about it than you or I.
I’m not a lawyer, but it appears that this bill could mean jail time for anyone who sent money to an online poker site based in a country on the list of adversaries, like Cuba or Russia. Are you sure that the app you play on isn’t based in Russia? That it doesn’t have any ties to Russia? That the banks it uses are not in countries the state department has labeled as adversaries? I’m not.
The second problem is that it essentially restricts all commerce with these nations. So the gray market sites and apps will have to choose between American customers and customers from Russia, China, and other nations. Do you want the government to tell you that you can’t play poker with people from China? I don’t, I want to be able to play with everyone.
A third problem is that VPNs, or Virtual Private Networks, will probably start refusing to accept traffic from Americans. They would be in legal jeopardy if they helped you engage in commerce with people or companies based in the wrong places, and since they have no easy way to prevent you from doing this using their product, they would probably just stop accepting Americans.
Why is the loss of VPNs a problem? Well, aside from the basic freedom to use a product if I want to, VPNs are what many online poker players use to play on overseas sites. Many players don’t want their location tracked when they play online, and losing this ability would definitely hurt the online poker market.
If sites like America’s Cardroom and Kings Club have to start refusing customers from China and Russia, and can not allow customers using a VPN for fear that they are from one of those countries, their traffic will drop. And a drop in traffic can easily take an online poker site below the critical mass they need to maintain their games and still pay for security and bandwidth and software updates.
Critics of the bill are also concerned about privacy, since the bill seems to allow the government to snoop on any internet connected device you own if they suspect you might be engaged in commerce with people in a country they deem unacceptable. And ForEx exchanges and Cryptocurrency transactions almost certainly fit within that definition as the bill currently reads.
Asset forfeiture is not good for poker players
My biggest concern with the bill is that it allows for asset forfeiture. I’ve long believed that asset forfeiture should be illegal and would support a constitutional amendment to ban it forever. I know of more than one poker player who has been pulled over by the police with a large quantity of cash on them and had to jump through endless legal hurdles to get their money back when they were not breaking any law.
Asset forfeiture incentivizes government organizations to take your money to fund their operations, and to make it very hard for you to get that money back. Nothing encourages false charges like a monetary reward for those bringing the charges.
In fact, one of the reasons Full Tilt Poker went broke was that the Department of Justice seized billions of dollars from them. The owners of the site were available to be arrested, but no warrants were issued while the DoJ seized money for years whenever they could find it. This indicates very clearly that their goal was not to stop the sites, or uphold the law, it was to take as much money from them as possible. They only stopped the sites from operating when there was no more money to take. This law will be used the same way.
Who decides when the law is being broken?
All it takes is for the Secretary of Commerce, someone who may not have any real knowledge about technology or finance, to decide that a company is breaking the law. There is no judge involved in this decision. Do you think that Wilbur Ross, the “King Of Bankruptcy”, who was 83 years old when he left the job in 2021, was an expert on information technology and online commerce? Is that who you want making the decision to spy on you and take your assets because you decided to use a VPN to play online poker?
And as a final problem with this bill, one that might affect us as poker players directly, any problem with online poker and the sites that operate in a gray area could have further consequences. Some of these sites have a long term plan that gives them two ways to win, and one of those ways is a big loss for us.
As we’ve seen in the past, when an online poker site is shut down, they all seem to be mysteriously broke. The reason for this is that the exit strategy for the owners of an offshore online poker site is that if they are ever shut down, they claim to be bankrupt and run off with the players’ money. They are essentially holding all the money in a poker game and planning to run off with it if they lose. This isn’t every offshore site, but it is definitely some of them.
And those unscrupulous site owners are ready to bounce with your money at any moment. This bill could give them a reason to do exactly that. If the government puts some heat on them, they are off with your money to retire wealthy and blame the United States government for the problem. We’ve seen it happen enough times now to know that this is not just a possibility, it is a clear part of their exit strategy. Ask any of the players from Absolute Poker, Ultimate Bet, Cake Poker, and hundreds of other smaller sites.
I urge you to contact your representatives about this bill. It’s one of those rare instances where it might make a difference because this bill hasn’t been claimed by one side or the other yet, meaning that your rep might actually care what you have to say about it.
