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Poker News | Gambling and the Law

Internet Gambling Legislation Introduced to Congress by Barney Frank

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As promised, Rep. Barney Frank (D-MA) came through with his pro-internet gambling legislation. It has been on his personal political agenda since the Unlawful Internet Gambling Enforcement Act (UIGEA) passed in 2006, but he began speaking publicly of his intentions in January of 2009 to introduce legislation that would not only authorize and regulate internet gaming but repeal the UIGEA by its virtue. Enter the Internet Gambling Regulation Consumer Protection & Enforcement Act of 2009.

Frank, who serves as the House Financial Services Committee Chairman, introduced the 48-page legislation at a pre-scheduled press conference in Washington, D.C. on the morning of May 6. He presented the bill that would establish a federal regulatory and enforcement framework through which internet gambling operators could obtain licenses to offer services to United States-based customers.

The first part of the Internet Gambling Regulation Consumer Protection & Enforcement Act of 2009 is written to provide for the licensing of websites based on their financial condition, corporate structure, business experience, and suitability to the market. Companies would be subject to intense scrutiny as well as criminal background checks. They would also be restricted from offering services to any state or tribal land that prohibits internet gambling, and any type of wager prohibited under the Professional and Amateur Sports Protection Act.

The second part of the legislation addresses enforcement and gives the Department of the Treasury the authority to monitor sites for their compliance with the law and punish those who violate the terms and conditions through the revocation or termination of the gaming license or fines or imprisonment should those actions be deemed necessary.

Lastly, the bill offers a number of consumer protections, starting with the compliance with the legal age as dictated by the state or locale of the customer. In addition, locations will be monitored to ensure that wagers are not being made from states or tribal lands where the actions are prohibited. There will also be steps taken to protect the privacy and security of players, in order to prevent incidences of identity theft, fraud, or money laundering. In addition, play will be monitored for compulsive gambling tendencies.

Frank also introduced a piece of companion legislation with the above-mentioned bill. The Reasonable Prudence in Regulation Act of 2009 is a two-page bill that simply delays any implementation of the UIGEA for a year. It is set to go into effect and require full compliance by December 1, 2009, but the bill would push that date to 2010, presumably giving ample time for the Internet Gambling Regulation Consumer Protection & Enforcement Act of 2009 to ultimately be passed and repeal the UIGEA in doing so.

At the same time, Rep. Jim McDermott (D-WA) introduced his own legislation that will compliment Frank’s two bills, as it calls for the establishment of a tax collection structure on any legal and licensed online gambling operators. This will allow the U.S. government to collect on the tens of billions of dollars that studies have shown can be counted as revenue from the industry.

Several lobbying organizations immediately praised the introduction of the pro-gaming legislation. The first to release a statement was the Poker Players Alliance (PPA). Chairman and former Senator Alfonse D’Amato said, “Online poker is a legal, thriving industry, and poker players deserve the consumer protections and the freedom to play that are provided for in this legislation. We are grateful for Chairman Frank’s leadership and will be activating our grassroots army made up of over one million members to help him drive legislation.”

Also in complete support of Frank’s legislation was the Safe and Secure Internet Gambling Initiative (SSIGI), which released a statement from the organization’s spokesperson Jeffrey Sandman. “As Americans continue to wager online more than $100 billion annually in a thriving underground marketplace, it is time for Congress to acknowledge that prohibition has been a failure and a new approach is needed. We support the legislation introduced today by Representatives Frank and McDermott that provides a sensible solution to regulate internet gambling in a way that protects consumers and collects billions of dollars in otherwise lost revenue.”

The PPA and SSIGI are prepared to lobby Congress in support of the Internet Gambling Regulation Consumer Protection & Enforcement Act of 2009, and they are not alone. Harrah’s Entertainment and Youbet.com both announced their support and readiness to launch lobbying efforts on behalf of the legislation. Youbet.com is a horse race betting site that caters to U.S. customers and looks to offer more games in the future. Youbet.com lobbyist Michael Brodsky told Bloomberg, “Our customers would love to do more and we would love to offer our customers more. There’s a big opportunity to do something that makes sense for everyone. It’s a very nice revenue-raiser at a time when everyone is looking to plug in the holes.”

Now that the bills are going through the Congressional process and receiving their H.R. numbers, they will soon need the support of members of Congress to push the bills through committees. That is where the poker-playing public comes in.

Two organizations provide easy access to all members of Congress, including pre-written letters that can be sent via their websites. The Poker Players Alliance and the Safe and Secure Internet Gambling Initiative offer these services and encourage you to contact your representatives and show your support for the new legislation today!

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