Internet Gambling Rules Get a Stay

by on December 1, 2009 · 14 comments

The U.S. Treasury and the Federal Reserve have pushed back the deadline for banking industry compliance with regulations pursuant to the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA). UIGEA, the controversial tack-on to the Bush administration’s SAFE Port Act aimed at curtailing on-line gambling by making it illegal for U.S banks and financial institutions to participate in funds transactions between U.S. citizens and corporations that operate online casinos, effectively banning Internet gambling.

In a joint statement, the Treasury and the Fed delayed the compliance date, which had been set for today (December 1) to June 1, 2010, the Gambling Today blog reports. The decision also comes just days before Thursday’s scheduled hearing in the House Financial Services Committee on H.R. 2267, a bill introduced by Rep. Barney Frank (D-MA), which would overturn UIGEA and create a full licensing and regulatory framework for the Internet gambling industry in the United States.

As Financial Services Committee chairman, Frank has been a vocal opponent of UIGEA and has been working for its repeal over the past two years. In authorizing the delay, the two agencies said that financial institutions were not prepared with the mechanisms they needed to block unlawful Internet gambling transactions, but they also noted that the rules did not provide a clear definition of unlawful Internet gambling. This last observation could be significant as it acknowledges one of the bill’s principal vulnerabilities—it broadly defines Internet gambling as games of chance. Opposition groups, notably the Poker Players Alliance, have repeatedly argued (correctly IMHO) that certain online casino games, especially poker, are games of skill.

Online gambling blogs generally greeted the delay positively and hope it is another step in the direction of restoring the freedom to gamble online.

As the Gambling Today blog notes:

The postponement was greatly appreciated by the supporters of online gambling. House Financial Services Committee chairman Barney Frank has two of his sponsored bills coming up for hearing on December 3. Frank said, “This will give us a chance to act in an unhurried manner on my legislation to undo this regulatory excess by the Bush administration and to undo this ill-advised law.”

  • nathan p

    Good luck to Barney Frank. Hopefully Americans will soon have the same rights on this issue as most of the rest of the world! You can sign a petition at http://www.right2bet.net

  • edwardmalenka

    I would rather have Internet gambling outlawed than have it regulated by the State. If it's outlawed I will still be able to gamble on the Internet, probably with some minor problems. If it's legalized I will be subjected to many more problems than just ones involving depositing/receiving money.

  • thinker

    While having the government legalize online gambling seems the proper way to go. In all honesty,
    the government should have absolutely no business in the gambling industry. Let the FREE markets prevail. Governments' job is only to protect LIFE, LIBERTY AND PROPERTY!!! Futhermore, the government couldn't organize a pissing contest in a brewery. Modern day governments are all about extraction of dollars from the mass so they can payoff the people that put them in power. The city of New York could not even run off track betting (a monopoly) without going broke. Trust the government, what, are you HIGH???

  • nathan p

    Whilst I agree with the sentiments, and understand the American way is slightly different, I don't agree that an unregulated market is the way forward. There needs to be some sort of regulator that can stop a dodgy casino operating out of Guinea Bissau (for example) that exists only to rob peoples bank accounts. Yes – the market SHOULD regulate itself, and there are many places where people can report such scamming activities online to warn other punters – but, as we've seen with concert tickets etc, people tend to take little notice when they think they are getting a great deal.

    Government run monopolies no – government + industry funded regulator yes.

  • smithjame

    This is really great news that internet gambling
    rules will not exit from now on. So there will be
    more and more people will be wining.
    motorbike sales

  • smithjame

    This is really great news that internet gambling
    rules will not exit from now on. So there will be
    more and more people will be wining.
    motorbike sales

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