Online Casinos Banned in South Africa – Now What?

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It seems the soap opera world of online gaming never ends. In recent developments, South Africa has banned any and all forms of online gaming, effectively making it illegal for any South African to gamble online, and for businesses to advertise online gaming websites anywhere in the country. This turn of events shuts down many operations that were serving South African gamblers, plus any operations planning to reach out to this emerging market.

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Essentially, South Africa is enacting measures similar to what is in place in the USA: the Reserve Chairman will ask banks to cease processing transactions to any gaming site. Next, the government will outlaw online gaming businesses in the country. Finally, to add some teeth to the new measure, a Rand $10 million fine will be imposed on any bank, gaming company, or advertiser that breaks these new rules. This raises an interesting question, similar to the conundrum facing USA banks: is it really feasible to monitor and prohibit transactions to all gaming operations? And, even if it is, will it really stop gamblers from accessing gaming sites?

One major South African online gaming business already took the national gambling board to court, and they were immediately rebuffed. The court stood by the new legislation, and affirmed the national gambling board’s decision to outlaw online gaming. Edward Lalumbe, Gauteng Gambling Board’s chief operating officer, said: “Part of the reason we have been fighting online operators is because we cannot guarantee that a gambler will win. If they do, we cannot guarantee that they will be paid their winnings.”

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Is this really a reasonable argument? Can’t gamblers face similar situations in land based casinos? Furthermore, are concerns about problem gambling at online gaming sites truly different from those at preexisting brick and mortar casino operations? In one instance, the Addiction Action Campaign offered an example of a male gambler leaving a physical casino establishment nearly broke, only to use his wife’s credit card later that night at an online casino.

Are such attempts at using ill-gotten gains limited to online casinos? In reality, this sort of thing happens all the time at regular casinos: instead of using someone else’s credit cards, compulsive gambler might be using cash from their child’s college fund. The only difference is that it is next to impossible to track where the cash came from, opposed to online gaming transactions that are 100% traceable. It is this irony that troubles South African facing online gaming operations.

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As with any other nation considering the legality of online gaming, South Africa surely had strong opposition from land based casinos, and likewise, anti-online gaming government lobbies were certainly financially supported by land based gaming industry groups. It always comes down to who has more money, and in this case, South African land based casinos won over the fledgling South African online gaming industry, which could never muster as much power behind its own appeals against the new anti-online gambling legislation.

So where does this leave South African online gambling companies and online gamblers? If you’re a company, you’re now officially out of business – there’s no two ways about it. If you’re a citizen looking to gamble online, you’re now up against strict new banking laws that will erect barriers in the way of any attempt to process transactions going to local or international online gaming companies. Ultimately, it’s likely offshore South African gambling companies will setup third party processing programs similar to those found in the USA offshore gaming industry, but are such solutions really worth it?

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Only time will tell. Interestingly enough, as South Africa banned gambling, the pro-online gambling bill created by Barney Frank, D-Massachusetts, passed the House Banking Committee’s vote, with bipartisan support. Canada has taken things a step further: www.playnow.com is the nation’s first legal online casino, with all proceeds going to government coffers. Plans for expanded online gaming and sports betting are already in the works in Canada, some of which will equal the “fully legal” status many UK online gaming companies enjoy. Surely, if things bode well for online gambling in Canada, the good will will percolate downwards to the USA?

Only time will tell. For now, we recommend the following top online casinos, accepting players from the USA and around the world.

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