Black Friday and How it’s Shaped the Future of US Sports Betting

Dark Day for Online Poker in the US

Black is the darkest color on the spectrum. It is often used to describe tragic points or happenings that have produced less than favorable outcomes. Black Monday on the stock market is one example.

The online poker community within the United States experienced one such dark day a little over eight years ago. In April 2011, the US Department of Justice unveiled an unwelcome gift, and presented it to the executives of the major online poker operators in the country.

What Was Black Friday?

In the world of online poker, it was called Black Friday. However, that shouldn’t be confused with the manic shopping spree that follows Thanksgiving. The online poker industry was in no way thankful about the events that took place on April 15th.

Some US taxpayers might have also been scrambling to meet a midnight deadline imposed by the IRS that evening, but the poker industry was scrambling for another reason. Facing lengthy federal prison sentences and a few billion dollars in hefty fines would tend to send almost anyone scrambling for answers.

President Bush Kicks it All Off?

The actual act of Black Friday started roughly nine years prior to April 15. When congress signed the Unlawful Internet Gambling Enforcement Act (UIGEA) into law in October 2006, the ball was set in motion.

The act didn’t necessarily make it illegal to play poker online. However, it did make a violation of US federal law to transfer business assets between gambling sites, and essentially players as well.

The poker industry did receive a generous period to fall into compliance, more than three years total. That ruling was also kicked down the road another half-year to June 2010. A number of popular online poker sites simply pulled operations out of the US.

During this entire limbo period between President Bush inking the 2006 legislation and the actual D-Day for online poker, there was a lot of infighting between providers. Much of the wrangling involved live poker shows, gaining in popularity at that time as well.

The Ball Drops

Early in the afternoon on that fateful day in April 2011, the ball dropped. Federal indictments were leveled against many of the most popular online poker sites operating in the US. To make matters even worse, bank fraud and money laundering charges were tacked onto the gambling charges.

A pair of the named defendants were unfortunate enough to be on US soil. A co-owner of a bank and a payment processor were taken into custody. Eight additional defendants were not in the US at the time the indictments were handed down.

Poker Bad, Sports Betting Good?

We’d be remiss not to mention the name of one of a man who was a huge vocal voice against online poker. The fact is, and he has said it openly, Sheldon Adelson simply does not like online poker. We could elaborate, but we’ll leave it at that. Adelson insisted he would spend whatever it took to bury online poker in the United States.

Now, what does this mean for online gambling in the US? Maybe more than we realize. Adelson is a wealthy man, a very wealthy man. He also owns the Las Vegas Sands Corporation. Yes, the same Las Vegas, where sports betting and casino gambling is and has been king.

Most appreciate why Adelson felt so adamantly that online poker should be banished. However, there doesn’t appear to be as much resistance against sports betting, online or brick and mortar. To add a little more interest to this situation, Adelson’s company also has a stake in the current approval and rise of sports betting in Pennsylvania.

Black Friday Affect Sports Betting Legislation?

It seems to reason, that when one of the most powerful figures in the casino and betting world has an ax to grind with one entity and a financial stake in another, which one stands to benefit. There are other aspects of what happened that will affect sports betting.

One will be the financial scandal that surfaced as the story unfolded. There will undoubtedly be a sense of skepticism to any providing of online betting platforms. Many of the proposed or active sportsbook operations are attached to more reputable fixed casino establishments, but the wound was opened.

Even in states that have created online poker venues, the result is a lukewarm reception. Those states that have considered adjusting their legislation to allow online poker venues are slow if moving at all. Sportsbook venues and legal online betting options have started to take a chunk out of what was a larger percentage of the gambling community.

Black Friday hit online poker operations hard eight years ago. The industry has yet to recover even marginally. Since many of its opponents are more strongly tied to sports betting, the industry may be fighting a battle on multiple fronts.