Economics 361N Final Project
Online Gambling
Online gambling is the placing of bets on sports
or casino type games over the internet. The betting, playing, and
collecting of money is done through the internet. The types of games range
from sports bets and casino games to lotteries and bingo.
Internet casinos are the places where gamblers can
place their bets on the Internet. As in Las Vegas, it is free to
gamble because the Internet casinos know that they are expected to win
and make a profit. There are generally three types of casinos.
First, there are casinos which require the gambler to download a free program
from the Internet. Programs like these make online betting more entertaining
with better graphics, sound and animation. The second type of casino
utilizes JAVA applets run through browsers instead of a downloadable program.
The third type of Internet casino uses only HTML. HTML based casinos
usually do not offer animation and sound. Instead they are basic
sights which allow for fast gameplay.
There are an estimated 400 different gambling sites
on the internet. Generally, these sites are located outside of the
United States in such places as: Antigua, Curaco, St. Kitts, Granada, Dominican
Republic, Gibraltar, and the Cook Islands. These small countries'
economies are boosted by the gaming licenses fees that the companies pay
up to $100,000 to acquire.
Betting money with these casinos is a fairly easy
process. First, the gambler will find a site and sign up that casino.
Sign-up requires filling out an online form which may not even ask for
a name or address. The gambler then receives an account number and
password which are solely their responsibility to remember. Next,
the gambler has to deposit money up front into their account. Western
Union, cashiers checks, money orders, transfers, and credit cards are all
different ways in which the casino can receive money. Personal checks
are rarely accepted. Once the money is deposited with the casino,
the account is managed like a regular bank account. As the gambler
wins or loses, the account is credited of debited. Withdrawal of
the money from the the account can be processed in any of the same ways
money is deposited.
A major concern of online gamblers is the security
of their accounts and transactions. Accounts are secured by regulations
passed by the government which the casinos are in. Many governments
require that the licensee posts bonds of cash or insurance as part of the
license requirements. Transactions and personal information is secured
by 132 bit encryption instead of the standard 128 bit encryption used by
a majority of online companies.
Eventually online gambling may move away from the
standard games and concentrate wagering on the users participation in an
arcade-type game like Doom. In order to win the most money the competitor
must shoot the most people.
Legal Aspects of Online Gambling
While actual physical
casinos and gambling are becoming present in every state, many people think
that online gambling is not a good idea. Having online gambling allows
for casinos to be directly in the home, which makes them more accessible.
many fear that children will be exposed to gambling as well as there being
an increase in the number of gambling addicts. No figures have been
determined on how much gambling addiction had increased, but there have
already been incidences where children use their parents credit cards to
place bets.
Another group affected by online gambling is college
students. Surprisingly, the National Gambling Impact Study showed
college students to be the majority of online gamblers. While major
problems such as drugs and alcohol are discussed with college students
in orientation, gambling addiction is not.
Initially, to combat this problem, legislators relies
on the Intrastate Wire Act of 1961 to prevent Americans from online gambling.
The Wire Act prohibited sports wagering between states using telephone
lines; unfortunately, no one has yet figured out just how this applies
to the Internet.
Today, two bills have been proposed to congress.
One failed and the other is still in the legislative process. Both
had the name "Internet Gambling Prohibition Act." Senator JonKyl(R-Ariz)
introduced the first bill. It made it all the way through a Senate
Judiciary Committee vote but was never signed because it was deemed "too
broad." Rep. Bob Goodlatle(R-VA) has introduced the most recent online
gambling prohibition bill. If the law passes, all Net casinos would
be outlawed, and proprietors would face up to four years in prison and
a $20,000 fine. The bill also bans gambling in states that have already
legalized it. This rider affects the constitutionality of the bill,
making it likely to not pass.
Critics say it would be easier to try to regulate
online gambling than ban it outright. Still proponents of banning
online gambling are committed to ending it.
Links of Interest
Legal
Issues
Casino Wire
Links Page to Casinos
Yahoo's
Casino Links