Paul's Blog August 20, 2018

“One morning I shot an elephant in my pajamas. How he got in my pajamas, I don't know.” Groucho Marx - Animal Crackers 

How to define “online gambling”, “wager”, and “prize”

There is now a gambling app being deployed by Muckleshoot Tribal Casino in Washington State that enables the player to deposit funds at the casino that is located within the boundaries of the sovereign tribal land and then play games-of-chance on their smartphone anywhere (as in, outside of sovereign land belonging to the tribe).  The player must go back to the casino to collect winnings.  The interesting point is that the beginning and end of the player’s journey — purchasing the games and collecting the winnings — must occur within the boundaries of the casino.  But the online game can be played anywhere.  This raises the questions:  In this scenario, is the “wager” taking place in the casino when the deposit is made, or when the game is played online?  Is the “prize” won when the game is played or when the prize is actually collected at the casino?  Common-sensically, it would seem that this is clearly online gambling.  But insofar as there are no legal precedents that yield precise definitions of “wager” and “prize” as applied in this particular scenario, the window is cracked for the regulatory system to be tested.  

The challenge for regulatory legislation to keep up with technological and process innovation is becoming more and more acute.  Are “loot boxes” gambling?  Does the secondary “synthetic” bet-on-the-outcome-of-the-lottery constitute selling lottery tickets?  If the time and place of the “wager” and “prize” are defined as the physical location where the transaction occurs as opposed to when the money is won or lost in the course of playing the game, that would seem to open the door for online gambling to explode as operators would not be bound by jurisdictional constraints.    And the traditional definition of "Gambling = Wager + Chance + Prize" is rendered obsolete.  

A letter was sent to McDonalds complaining about a “Happy Meal campaign featuring Nintendo’s Super Mario figurine with a toy slot machine.”  I do not pretend to be an expert on Responsible Gaming, but am reminded of the whole “Lottery Holiday Responsible Gaming" campaign to demonize gifting of lottery tickets.  All the publicity surrounding these issues would make one think that holiday gifting of lottery tickets or a McDonalds Happy Meal campaign are the primary source of problem gambling. And gifting lottery tickets to children is a very bad idea, and it's illegal for under-age people to play the lottery.  But is that what causes problem gambling?  Is that what we need to spend all this energy on to attack?  Maybe a more  serious approach towards problem gambling would focus on the activities of illegal online betting and gambling categories other than Lottery.  Just sayin’.