ISLAMIC BANKING

Topic: Gambling

Submitted To: Sir Waris

Submitted By: Tayyaba Iftikhar (914)

Shumaila Liaquat (909)
Danish Ilyas (923)

Discipline: BBA 7th

Submission Date: April 23, 2009

National University of Modern Languages

Gambling:
Gambling is the wagering of money or something of material value on an event with an
uncertain outcome with the primary intent of winning additional money and/or material
goods. Typically, the outcome of the wager is evident within a short period.

Islamic Perspective:
In Islam, Allah has forbidden Muslims from many things. And among the things that He
has forbidden is gambling. Quran has enlightened importance of seeking Halal sources of
income, to work for our livelihood, and not to depend on fate and chances, such as
gambling in all its forms, be it at casino, poker games, betting or lottery tickets. All these
are forbidden by Allah, for our benefit.
Some may think that the gambling industry is beneficial to a country. It may raise the
country’s economy, create many jobs, and can be contribute financially to charitable
organizations. Thus, they claimed, that the gambling industry contributes to the country
economically and socially. This may be true, to a certain extent. We cannot deny that
everything has its advantages and disadvantages.

But the main question is: do the benefits of gambling industry really outweigh its harm?
In ayat 219, surah Al-Baqarah, Allah says:

Which means: They ask you concerning alcoholic drink and gambling. Say: In them
is a great sin, and (some) benefit for men, but the sin of them is greater than their
benefit.

Allah s.w.t Himself has proclaimed that in gambling and alcoholic drinks, the harm and
destruction wrought are greater than their benefits. The person who gambles or drinks,
not only bring harm and destruction to himself, but also to those around him, particularly
his loved ones. It is because gambling and drinking are two activities that are highly
addictive.
The addiction in drinking may come from chemical changes in the body and brain from
alcohol. But the addiction from gambling is purely mental. The thrill in gambling, the
excitement of wanting to win, and win big, all these cause one to be addictive to such
activity. And when one is really addicted to something, he may try all means to satisfy his
addiction. The addiction is like bait. Bait for the gambler to continue his descent to the
tiny and dark hole of gambling prepared by Satan. As it is by Quran:

5:90 You who believe, intoxicants and gambling, idolatrous practices, and [divining
with] arrows are repugnant acts—Satan’s doing: shun them so that you may
prosper. 91 With intoxicants and gambling, Satan seeks only to incite enmity and
hatred among you, and to stop you remembering God and prayer. Will you not give
them up?

Those who fall into this hole will find it difficult to climb back. The hole is dark. So dark
that one may not be able to see the light of truth, the light of Iman. So dark that he may
not be able to think rationally. Allah also says in surah Al-Maidah, verse 91:

Which means: Satan wants only to excite enmity and hatred between you with
alcoholic drinks and gambling, and hinder you from the remembrance of Allah and
from prayers. So, will you not then abstain (from drinking and gambling)?

Ways of Gambling In New Era:

Casino games

Casino games include table, card and machine games played in a casino. They involve
playing or staking against a bank. Traditional casino games include roulette, blackjack
and poker.

Fixed-odds gambling

Fixed-odds gambling and Parimutuel betting frequently occur at many types of sporting
events, and political elections. In addition many bookmakers offer fixed odds on a
number of non-sports related outcomes, for example the direction and extent of
movement of various financial indices, the winner of television competitions such as Big
Brother, and election results.[8] Interactive prediction markets also offer trading on these
outcomes, with "shares" of results trading on an open market.

Parimutuel betting

One of the most widespread forms of gambling involves betting on horse or greyhound
racing. Wagering may take place through parimutuel pools, or bookmakers
may take bets personally. Parimutuel wagers pay off at prices determined by
support in the wagering pools, while bookmakers pay off either at the odds
offered at the time of accepting the bet; or at the median odds offered by track
bookmakers at the time the race started.
Sports betting

Betting on team sports has become an important service industry in many countries. For
example, millions of Britons play the football pools every week. In addition to
organized sports betting, both legal and illegal, there are many side-betting
games played by casual groups of spectators, such as NCAA Basketball
Tournament Bracket Pools, Super Bowl Squares, Fantasy Sports Leagues
with monetary entry fees and winnings, and in-person spectator games like
Mound ball.

Arbitrage betting

Arbitrage betting is a theoretically risk-free betting system in which every outcome of an

event is bet upon so that a known profit will be made by the bettor upon
completion of the event, regardless of the outcome. Arbitrage betting is a
combination of the ancient art of arbitrage trading and gambling, which has been
made possible by the large numbers of bookmakers in the marketplace, creating
occasional opportunities for arbitrage.

Other types of betting:

One can also bet with another person that a statement is true or false or that a specified
event will happen (a back bet") or will not happen (a "lay bet") within a specified
time. This occurs in particular when two people have opposing but strongly-held
views on truth or events. Not only do the parties hope to gain from the bet, they
place the bet also to demonstrate their certainty about the issue. Some means of
determining the issue at stake must exist. Sometimes the amount bet remains
nominal, demonstrating the outcome as one of principle rather than of financial
importance. Betting allow consumers to both back and lay at odds of their choice.
Similar in some ways to a stock exchange, a better may want to back a horse
(hoping it will win) or lay a horse (hoping it will lose, effectively acting as
bookmaker)

Ways of Gambling In Old Era:

 Ace-Deuce-Jack:

This is an intriguing game, and very simple to play. “Ace Deuce Jack” was a favorite of
the riverboat hustler. The player appears to have a great advantage in this game (10 to 3
in his favor), and in fact this is not the case. Standard equipment, with the layout is a
regular deck of cards (standard 52). The dealer calls out “All bets down” and players
place their chips, checks or cash/coin in the betting area of the layout. They are betting to
beat the dealer.
  BRAG:

Brag was a very popular pre-poker gambling game. The basic game of three card Brag
was one of the games described by Hoyle dates from the late eighteenth century or
earlier. Faro was known as the "King of Gambling Games" and in the late 1860's, Brag
was considered the "Queen of Gambling Games".

 Monte Bank:

Monte was one of the most popular card games of the early 19th Century, particularly in
the Southwest and the mining camps in Northern California. The game was introduced to
the U.S. in the 1840's, near the end of the Mexican-American War and spread very
quickly with the onset of the California Gold Rush.

 Craps:

Any number may play. Each person in turn may, as the shooter, toss two dice in
attempting to roll a winning combination. Before the first throw the shooter puts up a
stake, and the other players fade it, i.e., bet against the shooter up to the amount of the
stake. The shooter must withdraw any part of his stake that is not faded. If he wins, he
may continue to shoot and bet again, as much or as little as he wants; or he may give up
the dice. If the shooter loses, the other players take away double the amount they faded.

 Beat the dealer or high dice:

Beat the Dealer is a popular saloon game from the old west, as well as Mississippi
Riverboats. It was also known as “High Dice” and is a quick and simple game.
It was also commonly referred to as “the bartender’s game” often used to keep bar
patrons occupied while they are visiting the bar. This game is usually played with 3 to 6
players, all betting that they can “beat the dealer”. All players get their bets down by
placing their chip or chip stack clearly within the pass line area in front of them.

 A typical Faro setup:

The game vaguely resembled modern-day mini-baccarat. The dealer shuffled a single
deck and placed it face up in a special shoe. Then he would pull cards off the deck in sets
of two. The rank of the first revealed card in the set would be designated as a loser, the
next card's rank would be a winner (example: 9 loses, 5 wins, then 2 loses, jack wins,
etc). Players did not handle the cards. They would simply bet on card ranks to win or
lose; suits were irrelevant. The chosen rank would eventually appear, and that would
decide the contest.

The Prohibition Of Gambling:

As Islam plays a moderate role in worship, similarly it plays a role in economics and
social orders. How can Islam, the moderate way of life, cope with a state where one can
take possession of somebody else's property without any valid reason, due to which, the
latter gets poorer and his state diminishes and the former, without working, gathers the
wealth equivalent to that of Qaroon (Korah, a kaafir whom Allah bestowed with great
wealth at the time of Musa alaihis salaam)? Alternatively, without any religious excuse,
a great amount of wealth is taken from the poor people's pocket and a single person is
made to own it. Therefore, it was vital for Islam to prohibit these unfair ways of taking
possessions. For this reason the open mindedness of the all-encompassing religion, Islam,
took consideration and concern of the human passions. When alcoholic drinks and
gambling were intended to be banned, their prohibition was not revealed immediately,
but firstly all the disadvantages concerning them were made clear. Once these were
totally engraved into their hearts, then the laws of prohibition were revealed.
In the early days of Islam the Prophet sallallahu alaihe wasallam was questioned
regarding the permissibility of gambling and alcohol. The first verse that was revealed
regarding this, is in Surah Baqarah which is as follows:

"They ask thee concerning wine and gambling. Say, 'In them is great sin and some
benefit for men; but the sin is greater than the benefit." (Qur'aan 2:19)

In the above aayah, the permissibility and non-permissibility of wine and gambling is not
clarified. Soon after understanding the tone of discountenance in the verse, the highly
ranked companions of the Holy Prophet sallallahu alaihe wasallam abstained from them.
On the other hand, Muslims in general were still involved in them and the Prophet
sallallahu alaihe wasallam had not said anything that indicated their prohibition, until
Allah revealed the following verse:

"O believers! Intoxicants and gambling, worshipping stones and divination by arrows
are impure, of shaytan's handiwork: refrain from such abomination that ye may prosper.
" (Qur'aan 5:90)

In this verse, the total prohibition of alcoholic drinks and gambling has been clearly
revealed. Its prohibition has been mentioned with such assurance that Imaam Razi
rahmatullahi alaihe states as follows:

"Firstly, the Arabic word 'innama' has been placed in the beginning of the verse. In
Arabic, this creates emphasis on what is mentioned afterwards. Secondly, these
prohibited things have been classified as being 'rijs' (impure), from which natural
disposition abstains. Thirdly, they have been branded as satanic acts. Fourthly, their
severity has been categorised in the same level as idol worshipping (shirk) in the sense
that they all are links of a single chain."

After mentioning that these all are 'rijs' (impure), Allah Ta'ala orders:

"Keep away from them."

Allah Ta'ala does not terminate the subject here, but He carries on mentioning their
religious and worldly harm in the following aayah. Allah, the Almighty states
conclusively that shaytaan wants to ruin our worldly life and the life of the Hereafter.
These forbidden things, (alcohol and gambling), lay the seeds of hatred and hostility
between human beings. These evil outcomes are innumerable. Their habit distracts a man
from obligatory duties such as salaah and the remembrance of Allah.