1. Opinion

Column: Online gambling is a strategic national threat

Published Nov. 7, 2013

Online gambling, now operating from U.S.-based websites, is the new face of gambling expansion. We should not be naive, however. Beyond the known social costs of gambling, there is now the threat from online criminal activity, money laundering and, potentially, even al-Qaida funding. What is happening?

Pandora's box was unwittingly opened by the Justice Department in a December 2011 opinion that — erroneously, we believe — declared that the Wire Act of 1961 applies solely to sports betting, and thus appearing to open the door to other online gambling.

Expansion followed. Nevada now has two online poker sites operating; Delaware launched its gambling website with blackjack, roulette, slots and poker on Oct. 31; and New Jersey will launch on Nov. 21.

Remote gambling is fundamentally different from brick-and-mortar casino gambling because the website operator never has complete control. Using technology undetectable to website operators and their regulators, it is possible for gamblers to play games from physical locations that are not what they seem. We know, because we have done it.

Recently, House Energy and Commerce Committee staff and others in the Capitol Hill office of U.S. Rep. Gregg Harper, R-Miss., witnessed a demonstration in which a single remote computer took control of two computers and used them as alias machines to play poker online. The Harper demonstration showed the technology and techniques that terror and crime organizations could use to operate untraceable money laundering built on a highly liquid legalized online poker industry — just the environment that will result from the spread of poker online. One of us set up a website — — to help communicate the problem to a broader audience.

No one should doubt the ability of criminals to exploit the inherent weakness in online gambling. A drug cartel could arrange for buyers' machines to be remotely linked and lose to the aliased cartel machines. Drug buyers would not even need to play from their own machines. Illegal drug money would appear to be legal online winnings.

A single poker game takes just a few hours to transfer $5 million as was recently demonstrated — legally — by American player Brian Hastings with his Swedish competitor half a world away. An established al-Qaida poker network could extract from the United States enough untraceable money in six days to fund an operation like the 9/11 attack on the World Trade Center.

The threat is real. Last month a Texas lawyer was found guilty of trying to launder $600 million in drug money for a Mexican cartel. Caesar's Entertainment is currently under investigation by the Justice Department and IRS, accused of money laundering and Bank Secrecy Act violations.

In December 2012, the FBI's Tampa field office asked us to take down the website explaining the threat. We complied. This May, special agents at FBI headquarters in Washington responsible for enforcing the Wire Act and all other federal gambling laws were briefed on the vulnerability. In July, a Senate Commerce Committee hearing seemed to reinforce concerns. Rep. C.W. Bill Young wrote a letter of concern to FBI director Robert Mueller on Aug. 7.

But since then action seems to have stalled. And the threat moves on.

With the passing of Young, we have put the website back up and joined together in hopes of spurring action. Since it remains true that gambling regulations in Nevada, Delaware and New Jersey are no match for determined terrorists and criminals, we feel duty-bound as responsible citizens to ensure knowledge of the threat reaches as many policymakers as possible.

We have proved it is possible to make money laundering undetectable. Gambling should be firmly restricted to stay offline.

James Thackston, far left, is a Florida-based independent software engineer with a background in the aerospace, manufacturing and energy industries. Earl L. Grinols is distinguished professor of economics at Baylor University, former senior economist for the President's Council of Economic Advisers, and author of "Gambling In America: Costs and Benefits." They can be reached at and They wrote this exclusively for the Tampa Bay Times.


  1. David Straz Jr. passed away this week. JAMES BORCHUCK  |  Tampa Bay Times
    The retired banker will be remembered for the range of his philanthropy.
  2. Lucia Hermo, with megaphone, leads chants during a rally against HB 314, the near-total ban on abortion bill, outside of the Alabama State House on Tuesday. [Photo by Mickey Welsh of the Montgomery Advertiser via AP]
    Here’s what readers had to say in Wednesday’s letters to the editor
  3.  Bill Day --
  4. Jomari DeLeon, is pictured at at Gadsden Correctional Facility in Quincy, Florida August 7, 2019. Jomari is three years into a 15-year sentence for drug trafficking. She sold 48 tablets of prescription tablets over two days to an undercover officer. JOHN PENDYGRAFT   |  Times
    Even Oklahoma, a state not famous for progressive reform, has done more than Florida to fix sentencing inequities, Carl Hiaasen writes.
  5. In this photo from June 28, 2019, a Coalition for Life St. Louis member waves to a Planned Parenthood staff member. ROBERT COHEN  |  AP
    Florida law already requires that parents be notified prior to an abortion, writes senior policy counsel at the ACLU of Florida.
  6. Students say the Pledge of Allegiance as thousands gather at a candlelight vigil for several students killed in the Saugus High School shooting in Central Park, Sunday, Nov. 17, 2019, in Santa Clarita, Calif. CAROLYN COLE  |  AP
    We doctors treat diseases, but what of the epidemic of gun violence, writes a St. Petersburg doctor.
  7. Hillsborough Classroom Teachers Association members protest outside of the school board building in Tampa in December 2017. MONICA HERNDON  |  Tampa Bay Times
    Here’s what readers had to say in Tuesday’s letters to the editor.
  8. Muhammad Abdur-Rahim points out the location of what is believed to be a former African-American cemetery next to the parking lot of Frank Crum Staffing located at 100 S. Missouri Ave. in Clearwater.  The empty lot is part of the former Clearwater Heights neighborhood which featured Bethany CME church and Williams Elementary School.   Photo taken Wednesday, Nov. 13, 2019.  JAMES BORCHUCK  |  Times
    Tampa Bay’s lost cemeteries are part of our collective history.
  9. A business man and woman holding a sign depicting their political party preference. SHARON DOMINICK  |
    Here’s what readers had to say in Monday’s letters to the editor.