Yes, Gambling Is Illegal In DC – Except for This One Kind

lef_9780470593226_oeb_009_r1As a fascinating WAMU story outlined yesterday, there’s a new effort underway to legalize gambling in the District, and set up a “gaming facility” in Anacostia.  One of the major figures behind the campaign is reportedly Shawn A. Scott, who in 2006 pushed a ballot initiative that would’ve allowed slot machines in Anacostia; the plan failed and Scott was fined $600,000 when authorities determined that many of the signatures collected to support the initiative were fake.  This latest gambling legalization effort is following the same blueprint; they have to collect 25,000 signatures before July to make it onto the ballot.  But all this might be unnecessary, because while most forms of gambling are explicitly barred in the District, one form in particular is not, which means you could (probably) set up a gaming facility tomorrow, if you did it right.

An examination of DC’s gambling laws shows that the one form of gambling that isn’t illegal in DC is the bucket shop.  It was once banned, but that law was repealed in 2003, making it, yes, legal.  But what, you ask, is a bucket shop?  The bucket shop was a big deal following the invention of the stock ticker, in 1863.  It was essentially a sportsbook, but instead of placing bets on sporting events, people placed bets on the performance of stocks.  (Note – people didn’t actually buy or sell stocks, all they did was bet on their movements.)  Within a very few years, huge fortunes were made and lost in the bucket shops, to the point that the stock exchanges began to feel like their monopoly was being threatened.  What followed was an extended smear campaign to get the bucket shops banned, which would force their customer base of now-hardened traders to migrate the exchanges.  The exchanges and various experts lobbied hard for the bucket shop ban, saying most bucket shoppers were “unfitted by nature” and “not educationally qualified” for “the great evil of speculation.”  Despite the unsavory classist undertones and massive hypocrisy of these arguments, most states had banned bucket shops by the 1920s.  (Where did the term “bucket shop” come from?  In the late 19th century, street urchins would take discarded beer kegs, drain the dregs, and get drunk in abandoned buildings.  This was called “bucketing,” and the places where they drained kegs were called “bucket shops.”  The stock betting rooms were tagged with the name because they were seen as also salvaging the dregs, i.e. the small traders who didn’t have the money or influence to make trades through the exchanges.)

But as speculation and stock trading became more acceptable, and the rise of online trading made the ban a moot point, the bucket shop laws were struck off the books.  In the Elimination of Outdated Crimes Amendment Act of 2003, the City Council repealed DC’s bucket shop ban.  And so – you could legally open a bucket shop tomorrow, probably.  To get some clarity on the subject, I went to Daniel Hornal, Managing Partner at Talos Law, a broad-based people’s law firm in DC, and asked him to look at the code.

“It’s not perfectly clear,” Hornal said.  “But D.C. Code § 22-1704 makes it a crime to ‘set up or keep any gaming table, or any house …’ which could be read to cover bucket shops. One would also have to be careful not to violate the federal commodity regulations; for example, 7 U.S.C. § 6b (a)(2)(D)(i) specifically prohibits bucketing under many circumstances.  Also, you’d be competing against Maryland Live! and actual online stock trading. So even if it were legal, might not be a great way to make any money.”

So basically, it’s probably legal – yes, there’s still the federal ban, but there’s also a federal law against marijuana, and that hasn’t slowed down DC’s legalization efforts at all – but might not be a good idea.  But I maintain it’s a good idea!  Sure, you might think that no one would go to a modern-day bucket shop to bet on a stock when they could just buy it over the internet, but that misses the point.  Have you ever been to a Vegas sportsbook?  Very few of those gamblers actually like sports.  They’re just there because they’re degenerate gamblers who live for action.  They’d bet on the literal flip of the coin, they don’t care.  And those sportsbooks also offer a heavy dose of ambiance – there are free drinks, food, good-looking employees.  It’s as much a place to hang out as a place to do business.  Do you really think that if someone opened a state-of-the-art bucket shop in DC with free single malt whiskey and eye candy attendants, every dude who wears salmon shorts and boat shoes wouldn’t be in there 18 hours a day betting their trust funds on Halliburton like drunk NYPD officers in Vegas making sucker bets on the Yankees?  Of course they would!  This is a million dollar idea.  Shady investors: call me.

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