Monday, February 14, 2011

Paddy Power Abruptly Cuts off its Canadian Account Holders

For more information on the recent Paddy Power shutdown in Canada, read the follow-up to this blog post.

The legality of online sports betting, gambling, and other games of chance is, in many jurisdictions, "iffy."  For years, major online sports betting sites like Paddy Power and Betfair have been afraid to cater to American users for fear that they could have an arrest warrant issued against them by a single activist state, as was the case with Peter Dicks of Sportingbet, who had an arrest warrant issued against him by Louisiana and was arrested after getting off a plane in JFK Airport.

Fortunately, many countries with vague laws on the legality of betting in other countries have not taken the same approach as the United States.  However, someone in Canada sent me an e-mail they received abruptly from Paddy Power today with the following message:

Dear _______,

It has come to our attention that you are using a Canadian bank card. In accordance with Canadian law we will now be unable to take bets from Canada. Due to this, we will unfortunately have to block your debit/credit card and in turn close your account. You will still be able to withdraw any outstanding funds from your account for the next seven days. Please contact our support team if you require any assistance.

From 12pm GMT (Monday 14th February 2011), we will no longer be able to accept payments from Canadian sources.

We appreciate your custom and hope that your experience with was an enjoyable one. If you have any questions about this decision or your account in general please feel free to contact our Customer Service team using the details below.

Best Wishes,
Paddy Power Customer Service Team
This e-mail was sent without any warning, and Paddy Power was still taking bets from Canadians earlier that day.

So, why the sudden change?

One can only speculate, but an abrupt change like this might have been brought on by an activist Attorney-General in Canada, either federally or provincially.  At least one province in Canada recently started allowing its residents to engage in online gambling.  Perhaps a legal department in that government is making legal threats to cut out the private, free market competition.

Whatever the case, Canadians have one less competitor in the market which can only mean one thing:  Worse odds.  Whoever is responsible for this change is doing nothing but protecting the remaining betting companies, including government-operated ones, from competition.

If this is a case of government authorities strong-arming foreign companies, I would remind Canada of its Constitution's Charter of Rights and Freedoms:

2. Everyone has the following fundamental freedoms:

(a) freedom of conscience and religion;

(b) freedom of thought, belief, opinion and expression, including freedom of the press and other media of communication;

(c) freedom of peaceful assembly; and

(d) freedom of association.

Placing bets in another country strikes me as "freedom of association."  If the betting isn't occurring in Canada, I see it as no different than sending a letter and some money to a foreign bookmaker to request that they place a bet in the foreign country.  The bets do not take place in Canada, and unlike the United States, to my knowledge there are no laws on the Canadian books which prohibit transmitting money to a foreign country for the purpose of gaming.  In fact, Canada's s. 202 of Canada's Criminal Code refers to it being illegal to "import" certain promotional betting materials into Canada, but makes no mention of it being illegal to "export" funds for the purpose of a bet being placed in a foreign country.

I would also point out that people should not be prohibited from engaging in recreational activities simply because it offends someone else's religious sense of morality--that would certainly be a violation of the freedom of conscience and religion.  Of course, governments always attempt to justify such actions as being to "protect" the person engaging in the activity from themselves, and having nothing to do with the religious laws which were used to justify these laws when they were first enacted ages ago.  This argument from morality-enforcers always reminds me of what Ronald Reagan said the nine most dangerous words in the English language are.

Then there's also Section 7 of the same Charter mentioned above:

7. Everyone has the right to life, liberty and security of the person and the right not to be deprived thereof except in accordance with the principles of fundamental justice.

Canadian courts have held that "liberty" goes beyond just being free from being confined.  One Supreme Court decision stated, "Liberty means more than freedom from physical restraint. It includes the right to an irreducible sphere of personal autonomy wherein individuals may make inherently private choices free from state interference."  One would think that the choice as to whether one wants to risk throwing their money away is a matter of personal autonomy, but perhaps not.

Anyways, this post descended into a rant, but the main point is that for some reason one of the biggest betting websites out there is no longer accepting Canadian customers, only a few months after at least one Canadian province entered into the same industry.  It will be interesting if more details come out about just who is responsible for this change in Paddy Power's policy, and whether other online betting companies will follow suit.

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