Julie Jacobson / AP
Published Thursday, May 22, 2014 | 11:22 a.m.
Updated Thursday, May 22, 2014 | 11:52 a.m.
The casino industry's main lobbying group has quietly ended its push to legalize online gambling nationwide, a shift from a few months ago when it urged Congress to approve and regulate the practice.
The American Gaming Association's move comes as the matter sharply divides its members, who have joined rival coalitions for and against a bill that would impose a blanket federal ban on online gambling.
"It is not an issue we are focusing on, but rather letting others take the lead," American Gaming Association spokesman Christopher Moyer said Thursday.
AGA will instead hone in on more mundane issues such as modernizing license and regulation systems because "the AGA Board, including members on all sides of the issue, collectively agree that the right role for its trade association is to advocate for the many issues that unite our industry," President Geoff Freeman said.
Representatives from coalitions on either side of the issue declined to comment on the record.
Freeman took the helm of the association last spring on a mission to find consensus on online gambling, which is already legal in three states. But that task has proven all but impossible.
Las Vegas Sands CEO Sheldon Adelson has backed a bill, introduced in both chambers of Congress in March, that would make the practice illegal nationwide. The billionaire Republican super donor said he worries that placing a casino on every mobile device would devastate poor families, and he's vowed to do whatever it takes to stop the spread of Internet gambling,.
MGM Resorts and Caesars Entertainment have invested in the burgeoning industry and take an opposite stance on the bill. Freeman took their side when he testified before Congress in December that banning online gambling would strengthen the black market.
"Make no mistake, online gaming is here to stay," Freeman said at the time. "It is time for Congress to adopt sensible online gaming regulations that open the Internet to the millions who wish to play responsibly — while protecting children, assisting those with gambling disorders and empowering law enforcement."
But over the past few months, the group has shown signs of backing off its bullish stance. In a March interview with the Las Vegas Review-Journal, AGA Chairman Jim Murren — head of MGM Resorts and an online gambling supporter — said he thought the trade group should soften its rhetoric on the divisive issue.
"I don't want the AGA to find itself mired in a tremendous amount of controversy and infighting," Murren told the newspaper. "I have no interest in engaging in a fight we cannot win financially."
Freeman said earlier this month at a gambling conference in Mississippi and then again in an interview this week with the Wall Street Journal that AGA would no longer be involved in the matter.
Online gambling occupied a legal gray area until a federal crackdown in 2011. But later that year, the Justice Department said all online gambling except sports betting was legal, as long as it's permitted on the state level.
Nevada, New Jersey and Delaware have forged ahead, legalizing the practice among players who log in within their state lines. At least eight states have introduced legislation aiming to capture a potential windfall from online games, according to the National Conference of State Legislatures.
Morgan Stanley predicts that by 2020, legal online gambling in the U.S. will generate $8 billion a year.