Chicago Tribune, April 10, 2013

“INTERNET CAFES” ARE NO MORE:

  • On April 10, 2013, Florida Governor Rick Scott signed a law aimed at closing hundreds of storefront online gambling operations.
  • These storefronts are known as “Internet Sweepstakes Cafes” and had been very popular among residents throughout the State.
  • Closing these “adult arcades” – frequented by many retirees in different counties – will have the effect of wiping out approximately 14,000 jobs at some 1,000 businesses.
  • Before the new law was signed, the Internet Cafes (or “Internet Sweepstakes Parlors”) operated under an ambiguous Florida law that allowed companies to offer sweepstakes as a promotion for selling another product, such as phone cards and Internet time, that patrons could use however they pleased.
  • These online poker and slots-based operations were the heart of a three-year federal investigation that resulted in 57 arrests, involving money laundering and racketeering charges.

THE NEW LAW:

  • The new Florida law permits games of skill, but not those of “chance,” and limits prizes to 75 cents for each win.

TAKE AWAY:

  • Online gambling is in its infancy, with many more developments to come.
  • We already have seen states pass their own version of laws that permit Internet gambling.
  • More are soon to follow.