Will Online Gambling to Fold?


It just might if two US Congressmen from Virginia have their way. Back in February 2006 Representatives Bob Goodlatte and Rick Boucher, a Republican and Democrat respectively, introduced the Internet Gambling Prohibition Act. This is not the first attempt to regulate or ban online gambling. In fact a legal struggle has surrounded the enterprise since its birth in 1996. As you might guess, based upon the ease with which you can access an online casino or poker room, none of the attempts have proven successful.


This particular piece of legislation, however, works different than the others. Instead of attempting to gather votes for an outright ban, which would probably not hold up long in federal and international courts, this legislation seeks to target the tools and institutions that make paying for access to an online casino or poker room possible. The Internet Gambling Prohibition Act would allow law enforcement agencies to mandate a halt to all online gambling financial transactions taking place via credit card or bank wire. People found to be responsible for violations of the bill, should it pass, could be subject to fines or possibly even a prison sentence of up to five years.


According to Representative Goodlatte (R-Va.), as reported by a number of sources such as internetnews.com, the legislation is an attempt to ‘bring the present ban against interstate gambling in line with the international nature of internet technology. Representative Boucher (D-Va.) considers online gambling criminal behavior as it ‘evades the present anti-gambling laws.’


The present laws to which these to Representatives refer are the so-called ‘Wire Act’, which criminalized gambling over the phone. There is a deal of debate as to how, if, and the extent to which the Wire Act applies to the internet. The question is, to some degree, philosophical –what constitutes social space? Is an online Hold’em table simply ‘over the phone’ bet placement, or is it an entire social setting for gambling and entertainment, i.e. simply another casino where people meet and come together from all over the world for various gaming experiences?


The bill made it out of the Judiciary Committee on May 25th, and now this very anti-gambling legislation has been debated on the House floor throughout the past week, and is today up for vote. The bill was altered slightly when Representative Goodlatte agreed to combing his anti-gambling legislation with that of Jim Leach, another Republican from Iowa. The various banking and money exchange institutions are, for the most part, opposed to what they feel would impose the burden of enforcement and regulation costs on them. Lobbyists from the Independent Bankers of America stated, moreover, that even with a great many resources invested in enforcement of the law, the amount of enforcement and regulation actually possible is and would be marginal at best. On the other hand, ‘traditional-values’ lobbyists from the Traditional Values Coalition criticizes the bill for not going far enough. According to their spokesperson, the government should ban all forms of interstate gambling.


Many online gambling advocates are critical of these legal efforts for a number of reasons. First of all, why is the US trying to make online gambling regulations even more restrictive when even the present restrictions are in violation of World Trade Organization rules (antiguawto.com)? Second, the language of the Wire Act is rather non-specific, outlawing betting over the phone on ‘sporting activities and contests’. Suppose a business with two large offices on opposite ends of the United States. Would extension of the Wire Act to the internet make, say, an inter-office (though interstate) betting pool on something like the Super Bowl, or American Idols a criminal act?


What can be done? First, enjoy legal and tax free online gambling while it lasts. Second, all you big winners out there, donate some of your winnings to a potentially sympathetic politician and be sure they know from where it came!



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