POKER

Issue managers, strategic advisors, and FairPlayUSA

TAGs: Black Friday, FairPlayUSA, Preet Bharara, us poker regulation

fair-play-usaTwo high-profile men known mostly for their decades-long records of public service – and a little less for serving as advisers to major private sector entities – recently joined the board of advisers for the astroturf online-gambling interest group FairPlayUSA.

The first is Tom Ridge, a former soldier, former Congressman and former governor of the state of Pennsylvania who in 2001 was appointed the first head of the new Office of Homeland Security by United States President George W. Bush. Ridge served in that post and then later as head of the newly created Department of Homeland Security, the end result of the single largest reorganization of the United States federal government since the 1940s. Ridge resigned in 2004 to “to give personal and family matters a higher priority”; he later wrote in his book The Test of Our Times that his resignation was really motivated by pressure from the administration to raise the nation’s security alert just ahead of the 2004 presidential election.

The other heavy hitter is Louis J. Freeh. A former federal judge, FBI special agent and United States Attorney, Freeh was the Director of the Federal Bureau of Investigation from 1993 to 2001. During his time at the head of the FBI the bureau handled highly scrutizined investigations of the Branch Davidian incident at Waco, the bombing at the 1996 Atlanta Olympics, and the Wen Ho Lee case at Los Alamos National Laboratory. Freeh’s FBI also handled the apprehension of Ted “The Unabomber” Kaczynski, and implementation of the Carnivore program to spy on email and electronic communications. Freeh resigned in June 2001 and later wrote a book, My FBI, that was highly critical of President Bill Clinton.

Since leaving public service, both men have done well for themselves. Ridge is the CEO of Ridge Global, which describes itself as “a bi-partisan, full service government affairs and issue management group with nearly 30 years of hands-on experience with legislative, regulatory and administrative agencies on the local, state and federal level.” Freeh, too, formed his own consulting firm, Freeh Group International Solutions, which describes itself as “an independent global risk management firm” serving “a diverse range of organizations in a cross section of industries, working to reduce risk in today’s increasingly dangerous and complicated global marketplace.”

Though Ridge famously said in an interview on The Colbert Report this summer that he is “not a lobbyist,” he is the head of Ridge Policy Group, which makes its money by lobbying governments for a number of clients in various industries. According to an August 2, 2010 report in the Pittsburgh Post-Gazette, Ridge’s companies landed a $900,000 contract for consulting work with the natural-gas industry’s Marcellus Shale Coalition trade association in Pennsylvania. Ridge did not register with the state to personally lobby for the industry, but two of his former aides from his days as the state’s governor served as part of the Ridge Policy Group’s “legislative advocacy group” for the natural-gas industry. Ridge has also served on the boards of directors for companies including Home Depot, utility company Exelon Corporation, and Department of Defense contractor Savi Technology.
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Likewise, Freeh is not a lobbyist by strict definition. But since leaving public service he has done quite well for himself as the legal counsel for credit-card company MBNA and for Saudi Arabia’s Prince Bandar bin Sultan, and has earned seats on the board of directors for companies including MBNA and pharmaceutical giant Bristol-Myers Squibb. Previous to the formation of Freeh Group International Solutions, he also sat on the board of advisors for the Gavel Consulting Group, which described itself as “an ‘on-call’ group of former Federal judges who can provide strategic advice to corporations and law firms on anticipated actions in business, litigation, and investigations,” giving “pro bono services to foreign governments, professional organizations, universities, and U.S. Government agencies” with members who “bring a wealth of experience from the Federal bench and service at the highest levels of government.”

This technical distinction between the act of lobbying governments and the act of advising the groups that lobby governments fits in perfectly with FairPlayUSA’s modus operandi. In a garden-variety bit of Orwellian wordplay, FairPlayUSA calls itself a “grassroots movement” despite being funded by two of the world’s largest casino corporations and calls its push for strict regulations favorable to those companies a “focus on outreach and public education.” So who better to have on board than the advice of groups whose missions of “reducing risk in the global marketplace” and “government affairs and issue management,” when translated into plain English, are to provide access to the halls, language and culture of government? The addition of Freeh and Ridge to the seed money provided by brick-and-mortar powerhouses Caesars and MGM should be seen as a demonstration that FairPlayUSA is serious about its mission of quickly gaining strict regulation of the American online gambling market. And its reliance on loaded terms like “Wild West atmosphere” and “shady operators” thus far in press statements show it engaging the same tactics as Preet Bharara, the US Attorney for the Southern District of New York who labeled Full Tilt Poker a “Ponzi scheme” at a press conference.

Ridge and Freeh only drew a token amount of attention when they got on board with the pro-regulation group because the mainstream press is essentially clueless when it comes to the legal and political realities of online gambling in America, not to mention unwilling to delve into the web of political connections that makes influencing the favorable regulation of markets a real possibility for big companies. If Freeh and Ridge are doing the jobs FairPlayUSA hired them for, they’ll be like good referees at a hockey game: you won’t notice them at all. You’ll just wake up one day to find that the largest shares of the American online gambling market, a market that only a few short years before had been demonized by the United States government and press when it wasn’t being outright ignored, are suddenly owned by Caesars and MGM.

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