That state of California is currently considering whether they will become the fourth state in the U.S. to legalize online poker. While the financial benefits to the state have been covered in the past, some still do not see the real need for regulation. Why not keep doing what was done in the past? Below are a few reasons why California, and the entire nation, needs online poker regulation.

Stop Underaged Gambling

Regulation is necessary in order to provide proper checks against companies that would cater to underaged gamblers. In an unregulated market, underaged players can easily find ways to circumvent website “rules” regarding age and identity. Regulated sites do not have this problem.

In order for someone to play on a regulated site, they must go through a verification process that includes verifiable private information for the user. This includes a check on the player’s social security number and in some instances may include a background check. Underaged players will not be able to circumvent these checks legally and those that attempt to do so can face criminal prosecution.

Full Tilt Poker

As popular as the former Full Tilt Poker was among players worldwide, they are the poster child of why we need online poker regulation in California. For those unfamiliar with the story, Full Tilt Poker was one of the major online poker sites that were indicted by the federal government in April 2011. As PokerStars began paying U.S. players back their bankrolls, Full Tilt started to delay payments and then failed to make them altogether.

A couple of months later, the reason behind those delays became apparent. Full Tilt Poker has mismanaged player funds and had squandered all but a few million out of nearly $390 million of player deposits. Those funds were never repaid by Full Tilt but rather by PokerStars as part of a settlement with the Department of Justice that included the purchase of Full Tilt Poker.

What’s worse is that players connected to Absolute Poker and UB.com were never paid. Those companies completely folded following Black Friday and have never been heard from again.

Regulation puts a system of checks and balances in place that requires online operators to segregate funds and provide access to those funds upon player request. If a provider is unable to provide those funds, players have legal recourse starting with the regulatory body and moving forward.

Providers Must Meet Strict Guidelines

Under a regulated online poker market, all providers must adhere to a strict set of regulations put forth by a commission. The California Gambling Control Commission is the organization that is in charge of setting forth the rules by which providers must operate.

These regulations will set guidelines for everything from what games are offered to technological requirements for providers. If providers are unable to meet these guidelines, they will not be allowed to provide online poker services.

Regulatory bodies also determine suitability of providers. They conduct thorough investigations of each provider to determine whether they will provide a safe and legal online poker environment. If the regulatory body feels they are unsuitable, they will not get a license.

Reduces Most Crime Connected to Online Poker

The United States government has regularly issued concerns over the possibility of money laundering and other criminal activity by unregulated online poker sites. The reality is that criminal elements could potentially use online poker to help funnel cash into and out of their organizations. This is an area where regulation will help.

A regulated market would put strict controls on money deposited into and removed out of online poker sites. Unlike unregulated sites, you cannot use a regulated site like a virtual bank. There are no player-to-player transfers and deposits and withdrawals are limited to traceable sources.

Suspicious activity is also regularly monitored. You can’t login and chip dump thousands to players and expect that player to withdraw it for you. Unusual betting activity is logged and investigated immediately by regulated sites, something not often done for unregulated sites.

Finally, regulation prevents “fly by night” online poker sites that we have seen pop up in the past. If you remember sites such as “Pitbull Poker” and others that were basically glorified scams, then you know how harmful a shady site can be to players. Only legitimate sites will be available in regulated markets, providing an added layer of player security.

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