WEBVTT - How Online Gambling Works 0:00:01.120 --> 0:00:04.280 Welcome to you Stuff you should know from house Stuff 0:00:04.320 --> 0:00:12.720 Works dot com. Hey, and welcome to the podcast. I'm 0:00:12.800 --> 0:00:15.920 Josh Clark. There's Charles W. Chuck Bryant, and there's Jerry 0:00:16.000 --> 0:00:18.800 for the third time, and this is stuff you should know. 0:00:18.960 --> 0:00:23.560 The podcast two ball starts. Yeah. Really, Uh you a 0:00:23.600 --> 0:00:29.720 gambler at all? Uh? No, I mean not really. I'm 0:00:30.040 --> 0:00:33.040 I would lose too much money. But you've like been 0:00:33.080 --> 0:00:37.080 to a casino and I mean, like, yeah, I've gambled before. 0:00:37.080 --> 0:00:40.240 I'm just I realized pretty quickly that I'm a terrible 0:00:40.800 --> 0:00:43.839 gambler now, like I'm an addict or anything like that. 0:00:44.400 --> 0:00:48.640 Like I'd never win. So losing money's not fun. No, no, 0:00:48.840 --> 0:00:53.400 it isn't. I enjoy I don't like Vegas at all, 0:00:53.400 --> 0:00:55.480 as you know, but when I've had to go there, 0:00:55.520 --> 0:00:59.560 I do enjoy a little gaming. Um, but I always 0:00:59.600 --> 0:01:02.240 just I'm very disciplined to set aside a certain amount 0:01:02.240 --> 0:01:05.360 of money. I'm like, I'm basically like paying that to 0:01:05.600 --> 0:01:08.560 have a good time gambling. If I lose it all, 0:01:08.640 --> 0:01:10.880 then that's what. Because it is enjoyable. I enjoy it. 0:01:11.600 --> 0:01:13.320 And I did a little sports gambling at one point 0:01:13.319 --> 0:01:15.280 in my life and got a got out of a 0:01:15.280 --> 0:01:17.480 sort of a tight squeeze once and then I was like, 0:01:17.720 --> 0:01:20.080 not doing that again. Did you have your thumbs broken 0:01:20.160 --> 0:01:23.760 or something? No. I just owed um a lot of 0:01:23.800 --> 0:01:27.720 money going into NFL Sunday, and I was like, I 0:01:27.760 --> 0:01:30.560 can't afford this. So I did something really stupid and 0:01:30.600 --> 0:01:35.080 I made ny two bets equal to that large amount 0:01:35.080 --> 0:01:38.000 of money, one of both and broke even. And I 0:01:38.080 --> 0:01:41.959 was like, no more. That was good that you weren't like, Okay, 0:01:42.000 --> 0:01:45.200 I'm on the street and keep it going. That scared 0:01:45.240 --> 0:01:48.720 me straight, you know. Um, for this episode, I did 0:01:48.760 --> 0:01:51.160 a little online gambling. You know they let you try 0:01:51.160 --> 0:01:54.040 it out for free or whatever. I was down five 0:01:54.280 --> 0:01:56.960 d bucks in like four minutes. Well when it's not 0:01:57.040 --> 0:01:59.800 when it's fun money then like not real money, it's 0:02:00.000 --> 0:02:02.720 seed a bet a lot. I was just betting like 0:02:02.760 --> 0:02:05.600 the normal amount. I just I was playing a roulette 0:02:05.640 --> 0:02:11.680 called the Greedy Goblins. What site was it? Bovada? Have 0:02:11.760 --> 0:02:13.600 you heard of Bovada? It was the first one that 0:02:13.639 --> 0:02:15.959 came up when I put it online gambling. But it 0:02:16.040 --> 0:02:19.720 was a classy site. It was a classy simulated casino, 0:02:19.919 --> 0:02:23.680 pretty waitresses, I mean, well, there were pictures of people yeah, 0:02:23.960 --> 0:02:26.040 you know, no one was actually moving except the three 0:02:26.120 --> 0:02:29.040 D Goblins. They try to simulate a casino as much 0:02:29.080 --> 0:02:32.160 as possible, right, A little bit like the background of 0:02:32.160 --> 0:02:35.519 the website was like felt. I think maybe it was 0:02:35.600 --> 0:02:37.440 like that, but um no, it seemed to be one 0:02:37.480 --> 0:02:39.679 of the nicer ones. You could tell that the programmers 0:02:39.720 --> 0:02:42.880 like really put some thought into it. But the the 0:02:42.880 --> 0:02:45.840 the roulette or not the roulette the slot I was playing? 0:02:45.880 --> 0:02:49.120 Did I say roulette? First? I was playing a slot 0:02:49.200 --> 0:02:52.679 called Greedy Goblins, and it was nice looking, but I 0:02:53.120 --> 0:02:55.839 lost very quickly, so I was like, forget this. I'm 0:02:55.880 --> 0:02:58.919 so glad I'm not addicted to online gambling, because that 0:02:58.960 --> 0:03:02.200 would be really rough, I'm sure, And actually, I mean 0:03:02.240 --> 0:03:06.840 they say the online gambling is even possibly more addictive 0:03:06.840 --> 0:03:10.440 than regular gambling, just because of its ubiquity and ease 0:03:10.480 --> 0:03:12.960 of accessibility. Like not only can you get on the 0:03:13.000 --> 0:03:16.800 computer at home, now the big pushes mobile, so you 0:03:16.800 --> 0:03:20.839 can gamble anytime, anywhere, and if you have a problem, yeah, 0:03:20.880 --> 0:03:24.600 that's super super dangerous for some folks. You can gamble 0:03:24.680 --> 0:03:28.160 in your warm up pants, your shirt off, or your 0:03:28.160 --> 0:03:31.160 city jogger pants. I think some casinos in Vegas you 0:03:31.160 --> 0:03:34.560 could do that probably, h Maybe it's like the Golden 0:03:34.639 --> 0:03:37.800 Nugget or one of the old ones, whether they're like 0:03:37.880 --> 0:03:41.040 just just give us your money please, we're hurting so bad, 0:03:41.480 --> 0:03:46.200 or in all of Atlantic City. Sure. So. Um, you 0:03:46.200 --> 0:03:48.360 want to talk about the history of online gambling, you know, 0:03:48.400 --> 0:03:51.920 it hasn't been around forever. It hasn't. Gambling might be 0:03:51.960 --> 0:03:54.680 one of the oldest past times, but online gambling is 0:03:54.840 --> 0:03:59.720 comparatively new. Yeah. In the mid nineteen nineties and Antigua 0:03:59.760 --> 0:04:03.240 and Barbuda, they passed a law called the Free Trade 0:04:03.240 --> 0:04:07.360 and Processing Act, which basically paved the way for some 0:04:07.440 --> 0:04:11.400 of these smaller Caribbean island nations to get into the 0:04:11.640 --> 0:04:14.960 gambling business. Well for that nation specifically, Yeah, to get 0:04:14.960 --> 0:04:18.240 into the online gambling business. Right. Specifically, they created out 0:04:18.240 --> 0:04:22.159 of thin air their own ability to create licenses for 0:04:22.240 --> 0:04:25.599 online casinos. So they became the haven for online casino. 0:04:25.640 --> 0:04:29.040 It's a pretty good idea, it is, and especially considering 0:04:29.080 --> 0:04:31.479 that there was no such thing as online casinos yet. 0:04:31.720 --> 0:04:34.760 Like that's some foresight right there. Yeah. Around the same time, 0:04:34.800 --> 0:04:39.080 a company called Microgaming started the first uh kind of 0:04:39.080 --> 0:04:43.000 workable software for online gaming, and that came along at 0:04:43.040 --> 0:04:47.719 just the right time and U Canada they started opening 0:04:47.760 --> 0:04:51.479 up some online casinos and basically all over the world 0:04:51.560 --> 0:04:55.280 they started popping up. I think there were more than 0:04:55.320 --> 0:04:59.120 two hundred online casinos and revenues in the late nineties 0:04:59.160 --> 0:05:01.039 of up to eight hund in thirty million a year, 0:05:01.560 --> 0:05:06.080 which is chump changed now. But um back then, you know, 0:05:06.200 --> 0:05:08.640 you'll notice we did not mention the United States because 0:05:08.800 --> 0:05:13.040 it was there's a lot of legality issues. Up to today, 0:05:13.240 --> 0:05:15.359 you have online gambling virtually out of the gate. The 0:05:15.440 --> 0:05:19.440 United States is like, no, that's illegal. Completely ignore the 0:05:19.440 --> 0:05:24.400 fact that forty plus states have state lotteries. You can't 0:05:24.400 --> 0:05:28.840 gamble online. And actually I read an article where Antigua 0:05:29.600 --> 0:05:33.240 sued or filed the complaint against the United States with 0:05:33.320 --> 0:05:36.880 the World Trade Organization. The w t O sided with 0:05:36.960 --> 0:05:42.359 Antigua and they granted Antigua like a hundred and twenty 0:05:42.440 --> 0:05:49.839 million dollars worth of freedom to distribute American intellectual property 0:05:49.880 --> 0:05:55.640 without paying any royalties because America closed down it's um 0:05:55.680 --> 0:06:00.240 it's population to Antigua's online casinos. And Antigua said, you 0:06:00.240 --> 0:06:03.120 guys are violating treaties we have interesting and the w 0:06:03.279 --> 0:06:07.320 t O actually sided with and levied sanctions against UM. 0:06:07.560 --> 0:06:11.440 The US sided with Antigua Levi sanctions against US, which 0:06:11.480 --> 0:06:14.920 is mine boxing. Yeah, that probably doesn't happen a lot. Uh. 0:06:14.960 --> 0:06:17.560 In the early two thousand's, you could, all of a sudden, 0:06:17.560 --> 0:06:21.680 thanks to a company called Betfair, wage wager appeared appear 0:06:21.960 --> 0:06:25.200 bets on sports. A lot of this early stuff was 0:06:26.040 --> 0:06:29.960 sports UM wagering, right, and then online poker of course 0:06:29.960 --> 0:06:33.120 in the late nineties. UM really started to catch on. 0:06:33.760 --> 0:06:37.359 In the late nineties and early two thousands, UH company 0:06:37.400 --> 0:06:42.560 called Poker Spot and part Party Poker and Poker Stars. 0:06:43.000 --> 0:06:46.560 They all have silly names, but UM they really hit 0:06:46.640 --> 0:06:50.800 on it big when they UM allowed you to qualify 0:06:51.040 --> 0:06:55.720 online for these real World Series of Poker tournaments. And 0:06:55.880 --> 0:06:58.520 the one guy, Chris Moneymaker actually won the World Series 0:06:58.520 --> 0:07:01.479 of Poker in two thousand three after having qualified online. 0:07:01.880 --> 0:07:04.120 And then everyone was like, WHOA, that's a big deal 0:07:04.360 --> 0:07:06.480 because I think he ended up having to pay in 0:07:06.520 --> 0:07:09.880 like forty bucks to qualify for the World Series of Poker. Yeah, 0:07:09.880 --> 0:07:12.080 and he didn't have to travel to Vegas and you know, 0:07:12.200 --> 0:07:14.760 or Atlantic City or wherever else you can go to gamble. Yeah, 0:07:14.760 --> 0:07:16.800 and that's the way it was going to and everybody 0:07:16.880 --> 0:07:21.240 was really up on UM poker, especially Party Poker and 0:07:21.280 --> 0:07:25.080 Poker Stars, and UM the US ended up cracking down 0:07:25.160 --> 0:07:27.520 on it, which you'll talk about a little more in 0:07:27.560 --> 0:07:31.200 detail coming up soon. But UM, let's talk about just 0:07:31.600 --> 0:07:35.440 online gambling and how it's different, because it seems well, 0:07:35.440 --> 0:07:40.360 there there's some pretty obvious UM distinctions, like one gift 0:07:40.520 --> 0:07:44.200 to travel to Atlantic City or Las Vegas or your 0:07:44.280 --> 0:07:49.760 local Indian reservation and sit there and and gamble in person. 0:07:50.520 --> 0:07:53.440 That's I mean you might say, well, yes, obviously, if 0:07:53.480 --> 0:07:55.240 you're gambling online, you can do it at home. But 0:07:55.280 --> 0:07:58.360 that's that's there's a big difference. There's a lot of 0:07:59.560 --> 0:08:03.200 nuances in between those two. That obvious difference between the two. 0:08:03.320 --> 0:08:05.120 Sure one of them is you can play a lot 0:08:05.200 --> 0:08:08.680 faster without all the chit chat and all the decision 0:08:08.760 --> 0:08:10.520 making of the little old lady next to you at 0:08:10.520 --> 0:08:13.960 the blackjack table. UM and I wrote an article where 0:08:14.080 --> 0:08:16.880 with a guy named John Googliano or Gagliano. I mean 0:08:17.240 --> 0:08:20.320 he's a New Jersey professional poker player, John the Goog. 0:08:21.000 --> 0:08:24.440 I think it was like Googs thirty three years, gags 0:08:24.480 --> 0:08:27.840 thirty three something like that. Seriously, Anyway, he um, he 0:08:27.920 --> 0:08:30.600 plays up to a thousand hands an hour. Wow, he 0:08:30.680 --> 0:08:35.560 plays of no poker. He's a pro poker player. He plays, um, 0:08:35.600 --> 0:08:39.080 maybe a hundred hundred hands an hour per table, and 0:08:39.120 --> 0:08:41.160 he plays up to about ten tables at a time. 0:08:41.440 --> 0:08:43.760 About he's got to be playing more than one. Oh yeah, 0:08:43.800 --> 0:08:46.560 so he's playing like a thousand hands an hour um. 0:08:46.600 --> 0:08:48.800 And he says in real life he can play maybe 0:08:48.840 --> 0:08:51.160 twenty five tops if he's really working. And a lot 0:08:51.200 --> 0:08:54.040 of it is the chit chat the dealers. This is, 0:08:54.120 --> 0:08:56.040 you know, and not being able to physically play ten 0:08:56.080 --> 0:08:58.440 hands at a time. But see, that's the experience I 0:08:58.520 --> 0:09:02.520 enjoy about gambling is being at the table and chit 0:09:02.600 --> 0:09:05.479 chatting and having a couple of you know, free scotches. 0:09:06.040 --> 0:09:08.600 It's like a good social fun social like a craps table, 0:09:09.160 --> 0:09:12.640 a lot of fun okay to stand around. So yes, 0:09:12.760 --> 0:09:16.000 I think that's what makes Gags thirty three a professional 0:09:16.040 --> 0:09:18.920 poker player. You know, he's in it for the money. Yeah, 0:09:18.960 --> 0:09:20.839 he doesn't care about all that stuff, and probably to 0:09:20.920 --> 0:09:24.480 win too. Um. So yeah, it's a lot quicker. You 0:09:24.480 --> 0:09:28.040 can win and lose money at the drop of a hat. Um. 0:09:28.080 --> 0:09:29.840 And like you said, they try to dress it up 0:09:29.840 --> 0:09:33.960 and make it look and feel like a real casino. UM. 0:09:33.960 --> 0:09:36.760 Other than that, though, it's it's a lot of the 0:09:36.760 --> 0:09:39.160 same games, like pretty much any game you can play 0:09:39.160 --> 0:09:41.760 in a real casino you can find online from like 0:09:42.000 --> 0:09:46.560 lotteries and Keno to Roulette and all that stuff. Yeah, 0:09:46.559 --> 0:09:51.160 Bovada had UM more than a hundred and fifty different games. Yeah, 0:09:51.200 --> 0:09:52.720 a lot of them more slots, but they did have 0:09:52.760 --> 0:09:56.040 all the regular stuff too, in tons of different poker UM. 0:09:56.080 --> 0:09:58.240 And then, like you said, sports betting, and then there's 0:09:58.240 --> 0:10:01.880 a subsection of sports betting inter tainment betting, like you 0:10:01.920 --> 0:10:03.920 can bet on the outcome of the two thousand and 0:10:03.920 --> 0:10:09.200 sixteen presidential election or the oscars um apparently spelling bees, 0:10:09.600 --> 0:10:13.120 competitive eating contests. Reality TV, Yeah, which I didn't get 0:10:13.200 --> 0:10:18.840 because reality TV is not actually like unscripted. Yeah, like 0:10:18.920 --> 0:10:21.160 you could easily find out from a producer what happened 0:10:21.160 --> 0:10:24.880 on the show that was shot five months before. It's 0:10:24.880 --> 0:10:26.800 not like it's live, you know, or who's going to 0:10:26.880 --> 0:10:32.520 get the rose or whatever. I think those UM episodes 0:10:32.640 --> 0:10:34.920 are live a lot of times. They've got to be 0:10:35.080 --> 0:10:38.920 like the American Idol finale or the Survivor finale a 0:10:38.960 --> 0:10:41.040 lot of or a Big Brother. But I I just 0:10:41.080 --> 0:10:43.840 assume all those are extraordinarily rigged one way or another, 0:10:43.880 --> 0:10:46.800 and that anybody connected well enough could find out and 0:10:46.840 --> 0:10:49.120 make some big money, which I would guess that the 0:10:49.640 --> 0:10:54.760 people laying on the bookers, you know, the bookies, the bookies. Uh, 0:10:54.800 --> 0:10:57.640 they they would know well enough to stay away from 0:10:57.640 --> 0:10:59.480 that kind of stuff because it could be rigged. But 0:11:00.000 --> 0:11:04.840 wors is never right, So is that? Were you being facetious? 0:11:04.880 --> 0:11:07.720 Of course sports is rigged a lot of times. Really, Yeah, 0:11:07.880 --> 0:11:11.400 you kidn't me, Like, what we're not talking is Rourkes 0:11:11.440 --> 0:11:16.600 boxing fight. No, boxing is notoriously historically fraught with boxers 0:11:16.640 --> 0:11:19.160 taking dives. Okay, I thought you meant like Monday Night 0:11:19.160 --> 0:11:22.120 football or something like that. I mean, the NFL is 0:11:22.160 --> 0:11:24.480 a pretty good track record, but there most of the 0:11:24.480 --> 0:11:28.480 pro sports have had one major betting throwing games scandal 0:11:28.520 --> 0:11:30.560 in there at some point. Yeah. I don't think it 0:11:30.559 --> 0:11:34.079 happens all the time, but um yeah, like the Black 0:11:34.080 --> 0:11:36.320 Sox was baseball. Man, that was a good movie, Eight 0:11:36.320 --> 0:11:41.000 Men Out and uh I think, um yeah, you'll hear 0:11:41.000 --> 0:11:42.319 about every once in a while, like an n C 0:11:42.440 --> 0:11:45.080 double A basketball team will come out years later like 0:11:45.120 --> 0:11:49.240 we threw all those games? Oh, yeah didn't. Um, who 0:11:49.320 --> 0:11:51.320 was it that played Billy Jane King? The man who 0:11:51.320 --> 0:11:57.120 played Billy Jane King? Oh, Bobby Riggs? No? Who? Well, 0:11:57.280 --> 0:12:02.000 well guy, was it kids player? Yeah, very famous men's 0:12:02.040 --> 0:12:05.360 tennis player. I think it's Bobby Riggs. It wasn't Bobby Riggs. Anyway, 0:12:05.400 --> 0:12:07.440 he came out within the last couple of years and 0:12:07.440 --> 0:12:10.360 said that he threw the match. Oh please, which is 0:12:10.440 --> 0:12:13.760 kind of like it was it. It wasn't Jimmy Conner. 0:12:13.920 --> 0:12:17.439 Maybe it was Jimmy Conner save face. Yeah, but like 0:12:17.720 --> 0:12:22.480 four decades later, which is weird, deathbed saving face. I 0:12:22.480 --> 0:12:25.599 think he's still walking around. So um, we're going to 0:12:25.679 --> 0:12:29.559 talk more about online gambling and gaming and the distinction 0:12:29.640 --> 0:12:38.959 between the two. Um, right after this, you know, Josh, 0:12:39.280 --> 0:12:41.319 back in the old days, let me tell your story. 0:12:41.480 --> 0:12:43.520 If you want a website, you had to learn how 0:12:43.559 --> 0:12:46.559 to code, you had to learn how to design websites. 0:12:46.600 --> 0:12:49.600 You had to be really super smart until a very 0:12:49.600 --> 0:12:52.559 cool company called squarespace came along. That's right. They simplified 0:12:52.559 --> 0:12:56.320 things they did and chuck Even better than simplifying things, 0:12:56.440 --> 0:13:00.400 they're now progressing even further. 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That is one way though 0:14:30.440 --> 0:14:33.280 that they can get you hooked, you know, is to 0:14:33.440 --> 0:14:36.280 say that you don't have to pay any money. Um, 0:14:36.440 --> 0:14:38.120 did you have to do anything? Did you have to 0:14:38.160 --> 0:14:40.720 sign up? No? No, there's a there's a way you 0:14:40.760 --> 0:14:44.560 can download the casino software, which seems like a really 0:14:44.560 --> 0:14:48.120 bad idea to me. It's um like, do you want 0:14:48.120 --> 0:14:50.760 to download the staff software from a Russian site? No? 0:14:51.520 --> 0:14:53.760 I don't, but I will play it for free in 0:14:53.800 --> 0:14:56.080 my web browser, which is what I did. Was it 0:14:56.120 --> 0:14:59.040 really Russian software? No, this was Latvian. But I imagine 0:14:59.080 --> 0:15:04.280 there's plenty of Russian uh Russian casinos out there. Uh. 0:15:04.320 --> 0:15:07.240 Some of the other differences though, besides being able to 0:15:07.240 --> 0:15:10.000 play for fun and get you hooked, is they will 0:15:10.040 --> 0:15:13.640 offer different odds a lot of times sports wise than 0:15:13.680 --> 0:15:16.520 you can get in a real casino. So the grabster 0:15:16.720 --> 0:15:20.400 says that this isn't um. Oh, I'm sorry, you're saying 0:15:20.760 --> 0:15:24.920 that they the odds are better. I'm just saying different, 0:15:25.160 --> 0:15:29.080 Like sports odds can be different. Um. Usually they're better 0:15:29.120 --> 0:15:32.240 for you because the overhead is lower. They don't have to, 0:15:32.320 --> 0:15:34.400 you know, pay as much money exactly. They don't have 0:15:34.400 --> 0:15:36.920 to give out the free scotches because there's nobody to 0:15:36.960 --> 0:15:39.880 physically sit there and drink the scotch by your own scotch. 0:15:40.160 --> 0:15:43.640 You're at home at home, So you can get different odds, 0:15:43.640 --> 0:15:46.160 and then a lot of times the games themselves will 0:15:46.200 --> 0:15:51.479 have different kinds of payouts that you can get in casinos. Um. 0:15:51.560 --> 0:15:54.000 But you're also going to have to pay the big 0:15:54.120 --> 0:15:56.880 as they call it, um in order to get your money. 0:15:57.520 --> 0:15:59.160 And this is a whole different thing we have to 0:15:59.160 --> 0:16:01.400 talk about at some point too. But you're gonna be 0:16:01.480 --> 0:16:06.200 paying percentages, uh like tenient sometimes just to get your money. 0:16:07.000 --> 0:16:10.280 And that's not the same as in Vegas. No, it's 0:16:10.320 --> 0:16:12.960 definitely not one of the reasons why you you have 0:16:13.000 --> 0:16:14.680 to pay that. And that's on top of the big 0:16:14.720 --> 0:16:18.560 like you said, right, that's just basically that's like Okay, 0:16:18.640 --> 0:16:22.360 here give us our house money just for letting you play, 0:16:22.480 --> 0:16:25.040 and and then here's your transaction fee and then yeah, 0:16:25.080 --> 0:16:27.200 but that's when you're trying to withdraw stuff from your 0:16:27.240 --> 0:16:29.040 online account. And the reason that they do this and 0:16:29.080 --> 0:16:33.040 that the rates are so steep is because they know 0:16:33.120 --> 0:16:35.680 that you're an American player and you're not supposed to 0:16:35.680 --> 0:16:40.240 be playing technically, that is correct. Historically that has been 0:16:40.400 --> 0:16:44.320 very difficult to prosecute because you're in your house playing 0:16:44.360 --> 0:16:48.120 a casino in Amsterdam online. So what are they gonna 0:16:48.120 --> 0:16:50.920 do unless they've they're like spying on exactly where are 0:16:50.920 --> 0:16:54.160 they gonna do? Go after the operators of these um 0:16:54.200 --> 0:16:58.960 online gaming sites that are located overseas? Actually, yes, yeah, 0:16:59.240 --> 0:17:02.280 that's exactly what did this article Friday? Yeah, this article 0:17:02.320 --> 0:17:04.840 on how stuff works was written before Black Friday, so 0:17:04.880 --> 0:17:07.399 it was it almost even though it's a grabs article, 0:17:07.760 --> 0:17:12.280 it's naive because it was before this. Black Friday happened 0:17:12.280 --> 0:17:17.760 on September twenty, two, thousand eleven, where the Feds basically 0:17:17.840 --> 0:17:20.240 raided the top three and then some other ones, but 0:17:20.400 --> 0:17:24.280 definitely the top three online poker sites and shut them down. Yeah, 0:17:24.280 --> 0:17:28.080 Poker Stars, Full Tilt Poker and absolute poker. Uh. And 0:17:28.119 --> 0:17:31.560 apparently there were a bunch of uh some say, kinky 0:17:31.600 --> 0:17:35.159 allegations and arrest. Well, yeah, they used interpoll to go 0:17:35.440 --> 0:17:39.040 arrest the people in other countries for breaking US law. 0:17:39.320 --> 0:17:43.080 And yeah, a lot of US lawmakers had big problems 0:17:43.160 --> 0:17:45.280 with that, even though they attached a bunch of other 0:17:45.760 --> 0:17:49.920 charges like money laundering and fraud. Uh, there were you know, 0:17:49.960 --> 0:17:54.520 I'm sure there were some legit illegalities as well, but yeah, 0:17:54.520 --> 0:17:57.600 it was a pretty interesting sting operation, to say the least. 0:17:57.960 --> 0:18:00.960 So So, there's this thing called the wire Wager Act, 0:18:01.080 --> 0:18:06.280 I believe from nine and it said you can't use 0:18:06.680 --> 0:18:11.439 any kind of UM communications device basically in the the 0:18:11.560 --> 0:18:17.280 US for betting and um. The courts interpreted it in 0:18:17.400 --> 0:18:20.720 various ways as the Internet came along and some court 0:18:21.000 --> 0:18:23.880 some courts decided like, yeah, this this includes the Internet. 0:18:24.119 --> 0:18:26.240 Other courts are like, no, this is too old and 0:18:26.320 --> 0:18:30.639 too vague to really include the Internet. So the Feds, um, 0:18:30.880 --> 0:18:35.800 we're kind of like making noises about making prosecutions and stuff, uh, 0:18:36.359 --> 0:18:39.320 based on this. And when they kept running up against 0:18:39.359 --> 0:18:41.159 the fact that it was too old, they came up 0:18:41.160 --> 0:18:43.600 with a new law in two thousand and six. The 0:18:43.680 --> 0:18:47.600 Unlawful Internet Gaming Enforcement Act, and this one had teeth. 0:18:48.320 --> 0:18:50.240 The reason this one had teeth is because it didn't 0:18:50.240 --> 0:18:53.520 go after the online gambling people. It went after the 0:18:53.600 --> 0:18:57.680 third party processors, the payment processors. And what good is 0:18:57.720 --> 0:18:59.880 gambling if you can't get your money right when you're 0:19:00.359 --> 0:19:03.520 so all of a sudden visa PayPal, all the banks 0:19:03.920 --> 0:19:09.040 are like, wait, we could be prosecuted for processing this payment, 0:19:09.800 --> 0:19:13.200 so we're not gonna do it, which left these, um, 0:19:13.240 --> 0:19:20.159 these online gambling sites basically just completely um exactly because 0:19:20.200 --> 0:19:23.320 like you said, nobody who wants to gamble online wants 0:19:23.320 --> 0:19:26.800 to do it for nothing. It's the whole point, you know, 0:19:26.960 --> 0:19:29.920 is to try to win some money, right. Um. So 0:19:29.960 --> 0:19:33.560 that was two thousand six. That's when like Party Poker 0:19:33.640 --> 0:19:36.600 and Poker Stars and all those guys either shut down 0:19:37.280 --> 0:19:40.480 or they moved overseas. So those were actually American companies, 0:19:40.800 --> 0:19:42.320 but they moved to like the Isle of Man. They 0:19:42.359 --> 0:19:44.320 moved to Ireland, and there was one in Costa Rica. 0:19:44.520 --> 0:19:47.359 Full Tilt I think was in Costa Rica, and so 0:19:47.800 --> 0:19:51.639 the FEDS were like, Okay, we we did our job. 0:19:52.080 --> 0:19:57.040 Everything's cool, um. And these guys figured out loopholes and 0:19:57.600 --> 0:20:01.120 so the in two thousand eleven when they raided on Friday. 0:20:01.200 --> 0:20:04.760 The guy who actually ended up in real trouble was 0:20:04.880 --> 0:20:09.280 this dude who served as the payment processor for the 0:20:09.320 --> 0:20:13.159 three biggest online poker sites in the world. So not 0:20:13.240 --> 0:20:16.080 the gambler, not the casino, it was the guy who 0:20:16.240 --> 0:20:18.720 and it wasn't a company, it was a guy. And 0:20:18.720 --> 0:20:21.240 the reason he got in troubles because he started he 0:20:21.400 --> 0:20:24.320 made all these phony businesses up to get banks to 0:20:24.400 --> 0:20:27.360 process payments so the banks wouldn't think that they were 0:20:27.400 --> 0:20:31.840 doing any kind of illegal activity, right, So he he 0:20:31.920 --> 0:20:35.000 learned money, so he did get in big trouble um, 0:20:35.080 --> 0:20:38.520 and so did the three the top three sites. Until 0:20:39.600 --> 0:20:45.080 that same year, all of a sudden, this crazy war 0:20:45.359 --> 0:20:50.000 on online gambling was totally reversed by the Obama administration. 0:20:50.480 --> 0:20:53.080 Within the Obama administration, It's not like this was the 0:20:53.080 --> 0:20:57.760 Bush administration like aggressively prosecuting people for it. This was 0:20:57.800 --> 0:21:00.480 the Obama administration. And then all of a sudden, Department 0:21:00.480 --> 0:21:02.640 of Justice came up with a new opinion and said, 0:21:02.880 --> 0:21:05.720 you know what, we don't think the Wire Wager Act 0:21:05.880 --> 0:21:08.639 applies to this anymore, and we don't think that people 0:21:08.680 --> 0:21:13.360 should be prosecuted for online gambling if the states allow it. Yeah, 0:21:13.400 --> 0:21:15.919 and I think correct me if I'm wrong. Wasn't one 0:21:15.920 --> 0:21:19.080 of the big reasons behind this, like we need to 0:21:19.160 --> 0:21:22.000 start regulating this fast and get out in front of it, 0:21:22.080 --> 0:21:24.800 or else it's gonna be a huge mess. Yes, it's 0:21:24.800 --> 0:21:27.280 gonna be a huge mess. Um, it could be a 0:21:27.359 --> 0:21:33.040 huge boon for UM states for taxes and grabstrre mentions 0:21:33.040 --> 0:21:36.640 in this article that people tended to gravitate towards UM 0:21:36.800 --> 0:21:39.920 sites that had like a dot n L domain or 0:21:39.960 --> 0:21:43.679 a dot AU domain because they knew that Australia and 0:21:43.920 --> 0:21:48.560 UM the Netherlands heavily regulate this kind of stuff. They're legit, 0:21:48.800 --> 0:21:51.920 and so online casinos that operate out of those countries 0:21:52.000 --> 0:21:54.560 have to tell the line, which means that if you win, 0:21:54.640 --> 0:21:57.920 you're gonna get paid. So they provided a model that like, yes, 0:21:57.960 --> 0:22:00.439 if this is legal and regulated, people will come to 0:22:00.560 --> 0:22:03.280 it and you can actually manage it pretty well. Yeah. 0:22:03.560 --> 0:22:04.919 So in other words, I don't have to set up 0:22:04.960 --> 0:22:08.360 an offshore bank account or send money orders to some 0:22:08.560 --> 0:22:13.040 shady h third party internet site that may or may 0:22:13.040 --> 0:22:18.680 not pay you exactly. Um. I actually um. Last year 0:22:18.720 --> 0:22:23.440 I was the commissioner of my fantasy Football League and 0:22:23.640 --> 0:22:26.000 we all throw in twenty bucks. It's no big deal, 0:22:26.240 --> 0:22:28.639 like twelve of us, you know, just to make a 0:22:28.680 --> 0:22:30.040 little more interesting. At the end of the year, you 0:22:30.080 --> 0:22:32.679 win the money, and um, I said, just pay me 0:22:32.720 --> 0:22:34.919 through PayPal. And a few people said, you know, when 0:22:34.960 --> 0:22:36.560 you go to make the payment, it's like writing a check. 0:22:36.600 --> 0:22:39.080 You put what it's for. They were like fantasy football 0:22:39.080 --> 0:22:41.720 payment and PayPal flagged it and wouldn't allow it through. 0:22:42.240 --> 0:22:43.720 And I didn't even know at the time that was 0:22:43.760 --> 0:22:46.520 against the laws. Like really, and so I, you know, 0:22:46.800 --> 0:22:48.800 had them either send me money or just say, don't 0:22:49.160 --> 0:22:55.360 put what it's for. Done exactly because apparently apparently anything 0:22:55.400 --> 0:23:00.320