Coalition says gambling ban will fail like Prohibition

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A nationwide online gambling ban would be unfair to states like Nevada and New Jersey whose economies depend on the industry and would encourage gamers to participate in illegal black markets around the world, a gambling group says.

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The Coalition for Consumer and Online Protections (C4COP) launched a preemptive campaign against a congressional ban on Wednesday, arguing a gambling prohibition would be about as effective as the prohibition on alcohol was in the 1920s and early 1930s.

"Just like prohibition on alcohol created the speakeasies, prohibition on Internet gaming creates an unsafe black market," C4COP said on its website.

Currently, online gambling is up to each state. Three states — New Jersey, Nevada and Delaware — have legalized online gambling.

But C4COP is pushing back against anti-gambling groups who have called for a federal ban.

The Coalition to Stop Internet Gambling (CSIG) is one such group that is calling for a ban, because it argues that online gambling exposes children to games they can’t play in casinos.

"Internet gambling crosses the line of responsible gaming by bringing gambling into our living rooms and onto our smartphones, tablets and home computers 24 hours a day without necessary protections," CSIG says on its website.

Congress has yet to take up the issue.

C4COP is backed by gambling industry leaders, such as the American Gaming Association, MGM and Poker Players Alliance. They argue a ban would "trample" on states' rights. In Nevada, Las Vegas revolves around the gaming industry, and the same goes for Atlantic City in New Jersey.

"They have successful online gaming programs in their states," said Alison Harden, spokeswoman for C4COP. "So a federal ban would step on the states that already have successful gaming programs."

C4COP also said a ban would be dangerous for consumers, because some gamers would take their money to foreign black markets, which are not regulated.

"If the federal ban happens, millions of consumers who are playing right now will risk exposure to the overseas black market," Harden said.

A ban would also stifle innovation, the group said.