I know many of you never thought you would see the day when I’m the optimist regarding the legality of online gaming so get ready for a shocker. Last week I wrote a post about how I believed the 888 and Party discussions with the USAO to be a positive thing for the long-term outlook on poker. Poker author, sometimes Murder’s Row guest, and noted pessimist , Rick Russ Fox, disagrees.

PartyGaming is in negotiations with the DOJ. There are a few nuggets in the Forbes article that you may have missed. “PartyGaming said it initiated the talks with the DOJ, because US law enforcement agencies had taken action on other online gambling firms who had accepted bets from American customers before the new bill, and it was now responding to a request for information.” [emphasis added]

Let’s make the reasonable assumption that the DOJ sent information requests to all of the major online poker sites, and that Party & 888 (see below) responded, and the other sites didn’t. Who might the DOJ target? While negotiations are ongoing with Party & 888, I doubt they would be targeted.

And don’t kid yourself–the DOJ can make life miserable for the other sites, and they can go after the payment transferring companies. Whether they choose to or not is another question, but assume that Party tells the DOJ all about companies such as EPassporte, and all of the check processing firms used by the industry. Might they not get a subpoena?

Sure, Party is doing this for their own interests. But I think one of their interests is to cause problems for the firms left in the U.S. and I think they can and will do this.

I’ve already stated why I think these discussions are net positive but I wanted to address Rick’s Russ’ comments about ratting out the rest of the industry. Rick’s Russ’ usually been pretty slick on this stuff so it surprises me that he made such an odd argument. Does he really believe that the DOJ has no clue who EPassporte is? Does he believe it to be beyond the investigative powers of the FBI to create an account on Stars and see what payment options are being offered? That’s the Mac truck sized hole in the online gaming industry. They have to advertise their illegal funding options so people can use them.

The posts that have put the glass half-full label on me stem from this basic premise. How damn hard is it to figure out where the money’s going? Remember, these are the same guys who already have a massive infrastructure set up to deal with money laundering and terrorist funding. You don’t need to be Sherlock Holmes (or the input of online gaming operators) to figure out how online gaming sites are funded.

Bottom line is that I don’t think the USAO is tapping Party or 888 to figure out how accounts are funded. I tend to agree with the analysts who this as a far less sinister undertaking.

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