Legislation to Clarify UIGEA Fails to Pass Committee; Al D’Amato and PPA Speak to the Issue

by Lou on June 26, 2008

Lawmakers failed Wednesday to agree on a clear definition of illegal Internet gambling and the Federal Reserve and the Treasury Department have been unable to finalize rules that would implement the Unlawful Internet Gaming Enforcement Act (UIGEA) because Congress didn’t clearly define online gambling when it passed legislation less than two years ago.

Rep. King’s Amendment Would Have Clarified Matters
The House Financial Services Committee voted Wednesday on legislation by Rep. Peter King, (R-NY) that would have required federal regulators to write a uniform definition of the types of gambling that would and would not be allowed on the Internet, followed by new rules implementing the ban. Under committee rules, the 32-32 tie vote meant the legislation failed.

Bankers Can’t Police Transaction Without Celar Guidelines
Banks and other financial institutions complained that they are being forced into a law enforcement role because UIGEA prohibits them from accepting payments to settle online wagers without giving them a clear set of rules.
“The financial institutions are in the position of being told not process bets, but it’s not clear what is legal and what is illegal,” said Rep. Barney Frank, (D-MA), the committee’s chairman. He said financial institutions had been given “a job that is undoable.”

PPA Chairman and Former Senator Al D’Amato Had Some Strong Words
Former Senator Alfonse D’Amato (pictured left), chairman of the Poker Players Alliance (PPA), the leading poker grassroots advocacy group with over one million members nationwide, issued this statement in response to the House Financial Services Committee’s failure to pass H.R. 5767, the “Payment Systems Protection Act.”

“The PPA is surprised that the Financial Services Committee today failed to clarify what constitutes ‘unlawful Internet gambling’ under the Unlawful Internet Gambling Enforcement Act (UIGEA). The King Amendment would have required a separate formal rulemaking with an administrative law judge to determine the definition of unlawful Internet gambling.

Without Clear Definition, UIGEA is “…difficult if not impossible to enforce.”
“The Federal Reserve, Department of Treasury, and the banking industry have all testified before Congress that the lack of a definition of ‘unlawful Internet gambling’ makes it extremely difficult if not impossible to enforce this law and would result in a broader review and denial of financial transactions because they could possibly be deemed unlawful under UIGEA.

“It is disappointing to realize that opponents of this legislation still do not truly understand the intent of the bill. It was clear today that those who oppose this bill chose to focus on emotional and non-germane issues, such as the harmful impact of gambling on children, instead of on the merits of the bill itself.

UIGEA is Unworkable and Unenforceable as it Now Stands
“As it stands, UIGEA is a completely unworkable and unenforceable bill that would do little to address the main concerns of its sponsors – namely, protecting underage and compulsive gamblers as well as cracking down on money laundering. To truly address these issues, the PPA firmly believes that Congress should implement thoughtful and effective regulation of the online gambling industry as opposed to outright prohibitions, which history has shown do not work.
“Unfortunately, debate over the morality of gambling trumped debate on the fact that UIGEA is completely ineffective and unenforceable.”

{ 1 comment }

gtycoon June 29, 2008 at 12:00 am

The UIGEA is completely useless and a waste of time and money. The enforcement issues are pretty ridiculous considering it’s not really clear.

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