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13 April
2008 Congress Moves
To Suspend Internet Gambling Ban The Safe and
Secure Internet Gambling Initiative (SSIGI) has
announced its support for new legislation,
H.R.5767, that would prohibit the Department of the
Treasury and Federal Reserve System from proposing,
prescribing or implementing any regulations related
to the current ban on Internet
Gambling,
as required by the Unlawful Internet Gambling
Enforcement Act of 2006 (UIGEA). The bill was
introduced by Reps. Barney Frank (D-Mass.) and Ron
Paul (R-Texas). "The Frank-Paul
bill would stop the US government from taking any
further steps on regulations that would require all
of the country's financial institutions to block
Internet Gambling payments," said SSIGI spokesman
Jeff Sandman. "It's a bold move, but a necessary
one, in light of the warnings from the Treasury and
Federal Reserve that they did not know how to write
regulations to solve the problems created by UIGEA.
Further, witnesses representing a broad spectrum of
the financial services community unanimously stated
that the current ban on Internet gambling is
dangerous to the payments system and ineffective in
stopping people from using the Internet to play
poker, make bets on horses, or engage in other
types of wagering." The current
Internet gambling ban creates significant
additional burdens for US financial institutions,
which say that it is unfair to turn them into the
Internet gambling police at a time when their
undivided attention ought to be on the
economy. Testimony before
Congress last week offered proof that financial
services institutions would face serious regulatory
burdens in attempting to enforce UIGEA and related
regulations, which is unlikely to stop millions of
Americans from gambling online. Representatives
from the Credit Union National Association,
Financial Services Roundtable, American Bankers
Association and Wells Fargo & Co. testified
about the burden they would unnecessarily face
before the House Committee on Financial Service's
Subcommittee on Domestic and International Monetary
Policy, Trade, and Technology on April 2. The
current UIGEA law is ambiguous and allows for
multiple interpretations of what may or may not be
illegal activities. Their comments
reflect the concerns echoed in the more than 200
comments submitted to the Department of the
Treasury and Federal Reserve
System. Frank introduced
legislation last year, the Internet Gambling
Regulation and Enforcement Act (H.R. 2046), that
would regulate Internet gambling. The bill would
require licensed Internet gambling operators to put
in place safeguards to protect against underage and
compulsive gambling and ensure the integrity of
financial transactions. A companion piece
of legislation to the Frank bill introduced by Rep.
Jim McDermott (D-WA), the Internet Gambling
Regulation and Tax Enforcement Act of 2008 (H.R.
5523), would ensure the collection of taxes on
regulated Internet gambling activities. According
to a tax revenue analysis prepared by
PricewaterhouseCoopers,
taxation of regulated Internet gambling is expected
to generate between $8.7 billion to $42.8 billion
in federal revenues over its first 10
years. |
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