Farmer Column: The alleged wonders of online gambling

As a former Nevada gaming control official, I read with interest the Appeal's recent two-part series about online gambling.

Researched and written by American journalist David Altaner, an employee of GamblingCompliance.com, and bolstered by contributions from top Appeal editors and staff writers, the series noted that Nevada is the first state to permit interactive gaming, including online poker, which I oppose. (On its website, GamblingCompliance.com, touts itself as the leading online publisher of legal, regulatory, political and business information for the global gambling industry.)

Although Gov. Brian Sandoval, a former chairman of the Nevada Gaming Commission, endorsed legislation to legalize online gaming, I have serious reservations about his decision, which was approved last month by the Gaming Commission and investigative Gaming Control Board.

The Appeal's "All-in Online" series began with: "The stakes just got higher (as) Nevada officials approved the nation's first two interactive gambling licenses, a step that clears the way for online poker within state lines even while a federal interstate gambling ban remains in place."

The Gaming Commission approved licenses for two reputable slot machine manufacturers, International Game Technology (IGT) and Bally Technologies Inc., but dubious online poker companies are lurking in the background, and that's what troubles me about legalizing interactive gambling.

In a previous column headlined "Nevada needs to be 'All Out' regarding online poker," I pointed out that U.S. federal prosecutors have charged three major online poker Web sites - PokerStars, Full Tilt Poker and Absolute Poker - with bank fraud, money-laundering and other illegal gambling offenses. In addition, Full Tilt lost its British Channel Islands gambling license for running an alleged $400 million Ponzi scheme and Absolute Poker was involved in a huge cheating scandal in 2007.

The well-written and well-researched series noted that "European online gambling companies are scrambling to stake claims in the Silver State by forming joint ventures with (Nevada) casino companies." All three of the indicted poker companies are based in Europe, two in the U.K. and one in France. And in a related development, Gibraltar-based 888poker.com has established a "software relationship" with the company that operates Caesar's and Harrah's casinos in Nevada.

It's also instructive to remember that the indicted poker websites have contributed large sums of money to Nevada politicians including senators Harry Reid and Dean Heller, congressional representatives Shelley Berkley and Joe Heck, and State Assembly Speaker Steven Horsford, all of whom have pledged to donate the tainted contributions to charity. Well, maybe.

"I'm determined that Nevada maintain its position as leader of gaming in the world," Gov. Sandoval said after the Gaming Commission approved online gambling within the state's boundaries. Senate Majority Leader Reid, another former Gaming Commission chairman, favors in-state online poker because "it will create jobs, lots of jobs."

Nevertheless, with all due respect to Gov. Sandoval and Sen. Reid, although I hope their gamble on interactive gaming pays off for the Silver State, I have serious doubts about whether our gaming regulators will be able to successfully police online poker. Because, as I wrote last December, "Online poker ... can never meet the high standards of Nevada's strict gaming control system."

That's why I think we should be "all out" on this risky bet.

• Guy W. Farmer, of Carson City, was a spokesman for Nevada's gaming control agencies in the 1960s.