House Introduces Online Gambling Bill Backed by Sheldon Adelson

Republican mega-donor Sheldon Adelson is making a renewed push to ban online gambling after it failed last year.

Reps. Jason Chaffetz, a Utah Republican, and Tulsi Gabbard, a Hawaii Democrat, reintroduced an Adelson-backed bill Wednesday, provoking another battle within the deep-pocketed gaming community pitting Adelson’s Las Vegas Sands against MGM Resorts and Caesars Entertainment, which hope to make money online.

Speaking to a handful of reporters in his Washington office, Chaffetz said that he supported the bill out of concern that online gambling companies are targeting children. He is considering calling a hearing on the matter in the House Oversight and Government Reform committee, which he now chairs.

“That is so offensive and wrong,” he said. “When you’re a seven year-old kid and there is no physical barrier, and all you need to do is get your iPhone, that becomes a whole new world.”

“This is the Wild Wild West,” he added. “There are no rules, no prohibitions, no structure, no oversight, nothing.”

Republican Sen. Lindsey Graham, whose spokesman says he will introduce the same bill in his chamber, believes that Internet gambling is a “nefarious activity” and should be banned. “I think people in the criminal world and terrorist world could get a benefit from it,” he said.

If passed, the bill would overturn a 2011 Department of Justice ruling on the Interstate Wire Act that effectively allowed the states to decide on whether or not to legalize online gambling. With still-unrealized dreams of tax revenues, Delaware, Nevada and New Jersey became the first to do so in 2013.

The issue doesn’t break along the usual partisan divide. There are six co-sponsors on the House bill, ranging from conservative Reps. Steve King and Trent Franks to moderate Republican Charlie Dent. Other Republicans believe that it is a states’ rights issue and are more or less happy with the DOJ ruling.

Grover Norquist, the head of Americans for Tax Reform, argued that Congress should reject the bill and leave the issue to the states.

“You don’t want the federal government coming in and evening things up: ‘Oh, it’s not fair if Delaware has gaming and Pennsylvania doesn’t,'” he said. “Let them decide. It’s not your job. You don’t live there. And if it’s a dumb idea, then after a while Delaware will be ‘Hey that’s a dumb idea’ and change the law.”

The debate has attracted high-profile lobbyists like former Mississippi Gov. Haley Barbour, who works for Caesars. Chaffetz said he met with Adelson in January and told him about his intentions to introduce the bill.

“Is there big money involved in gaming,” Chaffetz asked. “You bet there is. There’s a lot of money out there. They’re banking on converting millions of people to generate billions of dollars in revenue that they haven’t been able to do before. And that means by getting it to markets like Utah and all nooks and crannies of the country.”

“It is not just about any one person,” he added.

But Adelson is indeed an “active player,” as Chaffetz put it. He met with House Speaker John Boehner and House Judiciary Committee members in January, according to the industry publication GamblingCompliance, and Andy Abboud, Adelson’s chief lobbyist, has vowed a “full-court press.”

Adelson’s moves follow a 2014 election cycle in which he gave $13.2 million—more than any other GOP-aligned donor according to Politico—to help the Republicans take the Senate majority. He also gave the yearly maximum individual donations of $32,400 to the National Republican Senatorial Committee and National Republican Congressional Committee, and $2,600 to several Republican Senate candidates, including Graham and Senate Majority Leader Mitch McConnell, according to the Center for Responsive Politics and CQ Moneyline. His political action committee run by Abboud spent nearly $60,000 last cycle. He did not give money directly to Chaffetz, who won in a landslide last year.

But Chaffetz can claim other allegiances with the GOP’s top moneyman. Chaffetz is going to Las Vegas this weekend and said he wanted to see Adelson, but he’s out of town. When a reporter asked where he’s staying, Chaffetz replied with a smile, “The Palazzo,” a Las Vegas Sands property.