US House on the brink of taking away online gambling rights

Jul 10, 2006, 8:16 pm (30 comments)

Online Gambling

Gamblers who prefer their laptops to blackjack tables won't like what Congress is doing.  On Tuesday, the House plans to vote on a bill that would ban credit cards for paying online bets and could padlock gambling Web sites.

The legislation would clarify existing law to spell out that it is illegal to gamble online.

To enforce that ban, the bill would prohibit credit cards and other payment forms, such as electronic transfers, from being used to settle online wagers. It also would give law enforcement officials the authority to work with Internet providers to block access to gambling Web sites.

Some opponents of the legislation say policing the Internet is impossible, that it would be better to regulate the $12 billion industry and collect taxes from it. The online gambling industry is based almost entirely outside the United States, though about half its customers live in the U.S.

Other critics complain that the bill doesn't cover all forms of gambling. They point to exemptions they say would allow online lotteries and Internet betting on horse racing to flourish while cracking down on other kinds of sports betting, casino games and card games like poker.

"If you're going to support legislation that is supposed to 'prohibit gambling,' you should not have carve-outs," said Andrea Lafferty, executive director of the conservative Traditional Values Coalition.

Other conservative and antigambling groups are supporting the legislation, sponsored by Reps. Bob Goodlatte, R-Va., and Jim Leach, R-Iowa.

John Kindt, a business professor at the University of Illinois at Urbana-Champaign who has studied the issue, calls the Internet "the crack cocaine" of gambling.

"There are no needle marks. There's no alcohol on the breath. You just click the mouse and lose your house," he said.

Congress has considered similar bills several times before. In 2000, disgraced lobbyist Jack Ambramoff led a fierce campaign against it on behalf of an online lottery company.

Online lotteries are allowed in the latest bill, largely at the behest of states that increasingly rely on lotteries to augment tax revenues.

Pro-sports leagues also like the bill, arguing that Web wagering could hurt the integrity of their sports.

The horse racing industry also supports the bill because of the exemption it would get. Betting operators would not be prohibited from any activity allowed under the Interstate Horseracing Act. That law written in the 1970s set up rules for interstate betting on racing. It was updated a few years ago to clarify that betting on horse racing over the Internet is allowed.

Greg Avioli, chief executive officer of the National Thoroughbred Racing Association, said the mention of horse racing in the bill is "a recognition of existing federal law," not a new carve-out.

He said the racing industry has a strong future in the digital age and acknowledged the bill would send Internet gamblers to racing sites. "They'd return to the one place they can bet legally," Avioli said.

That's what some critics say is unfair.

"Somehow we find ourselves in a situation where Congress has gotten in the business of cherry-picking types of gambling," complained Rep. Robert Wexler (news, bio, voting record), D-Fla. Wexler had tried unsuccessfully to include exemptions for dog racing and jai alai, both popular in Florida.

The Justice Department has taken a different view on the legality of Internet betting on horse races. In a World Trade Organization case involving Antigua, the department said online betting on horse racing remains illegal under the 1961 Wire Act despite the existence of the more recently passed Interstate Horseracing Act.

The department hasn't actively enforced its stance, but observers say it is possible the agency and the racing industry could face off in court in the future.

Regarding the House bill, Antiguan Finance Minister Errol Cort said Monday, "I'm very surprised and quite disappointed that the U.S. Congress would be pushing full force ahead."

Sen. Jon Kyl (news, bio, voting record), R-Ariz., is leading support for the ban in the Senate. The issue has so far not been debated in that chamber this year.

The bill is H.R.4411.

Dissenting Opinion

Ron Paul, a Republican from Texas, made it clear that banning online gambling is a terrible decision.  His dissenting views were included at the end of the original bill dated April 6, 2006.

We include his complete text here.

H.R. 4411 limits the ability of individual citizens to use bank instruments, including credit cards or checks, to finance Internet gambling. This legislation should be rejected by Congress since the federal government has no constitutional authority to ban or even discourage any form of gambling.

In addition to being unconstitutional, H.R. 4411 is likely to prove ineffective at ending Internet gambling. Instead, this bill will ensure that gambling is controlled by organized crime. History, from the failed experiment of prohibition to today's futile ‘‘war on drugs,'' shows that the government cannot eliminate demand for something like Internet gambling simply by passing a law. Instead, H.R. 4411 will force those who wish to gamble over the Internet to patronize suppliers willing to flaunt the ban. In many cases, providers of services banned by the government will be members of criminal organizations.

Even if organized crime does not operate Internet gambling enterprises, their competitors are likely to be controlled by organized crime. After all, since the owners and patrons of Internet gambling cannot rely on the police and courts to enforce contracts and resolve other disputes, they will be forced to rely on members of organized crime to perform those functions. Thus, the profits of Internet gambling will flow into organized crime. Furthermore, outlawing an activity will raise the price vendors are able to charge consumers, thus increasing the profits flowing to organized crime from Internet gambling. It is bitterly ironic that a bill masquerading as an attack on crime will actually increase organized crime's ability to control and profit from Internet gambling.

In conclusion, H.R. 4411 violates the constitutional limits on federal power. Furthermore, laws such as H.R. 4411 are ineffective in eliminating the demand for vices such as Internet gambling; instead, they ensure that these enterprises will be controlled by organized crime. Therefore I urge my colleagues to reject H.R. 4411, the Unlawful Internet Gambling Funding Prohibition Act.

AP and Lottery Post Staff

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Jimiam's avatarJimiam

I should probably steer away from these topics, they tend to get me riled up and flustered. I"m usually hard to get riled up.

Jimiam

Jimiam's avatarJimiam

Plus, you know it might make me a mite nervous. Plus, ever since they let me out ot the "nervous hospital"  they said don't get nervous.

Ha ha ha ha, I'm so darn funny!

Jimiam 

bellyache's avatarbellyache

I think banning credit cards from being used will make it hard for gamblers to play, but I'm sure there will be ways around this.

John Kindt, a business professor at the University of Illinois at Urbana-Champaign who has studied the issue, calls the Internet "the crack cocaine" of gambling.

"There are no needle marks. There's no alcohol on the breath. You just click the mouse and lose your house," he said.


Whatever. The government doesn't care if you lose your house. They're just upset because they want a piece of the pie and are losing millions in taxes.

JAP69's avatarJAP69

I think banning credit cards from being used will make it hard for gamblers to pay, but I'm sure there will be ways around this.

John Kindt, a business professor at the University of Illinois at Urbana-Champaign who has studied the issue, calls the Internet "the crack cocaine" of gambling.

"There are no needle marks. There's no alcohol on the breath. You just click the mouse and lose your house," he said.


Whatever. The government doesn't care if you lose your house. They're just upset because they want a piece of the pie and are losing millions that they never see.

[The government doesn't care if you lose your house]
You are right.
Do not pay your real estate taxes within a time frame and they will sell it out from under you in a skinny minute.
Put you out in the street. they will

konane's avatarkonane

If passed, I smell plenty of legal challenges probably all the way to the Supreme Court.  Maybe the senate will kill or at least table it indefinitely.

GoldenEgg

I'll bet those sites will post a "Play Agreement Declaration" message where the player will have to check the "Agree" before they play, then pay via "Tel-Check", money orders or even FedEx Cash to the address that will be posted below. ROFLLLLLLLLLL

four4me

are they going to tell us we can't send a money order to the gambling sites. NOT

time*treat's avatartime*treat

Ron Paul is one of the few elected officials with any sense. Not just for this, but for his positions on many things. I'll be sad to see him go. If our "benefactors" want to enforce something, try our southern border. If they want to "stamp out" something, try Osama. Ahh, but that's too much like REAL work.

orangeman

This is another crazy idea that won't fly.  If it does and they manage to shut down gambling web sites, they should also block all "adult" sites, too.  Porn is more destructive than online gambling.

Orangeman                              Bash

BobP's avatarBobP

If this bill gets passed they should stop advertising the U.S. as a free country where the people decide how things are done.  BobP

moxie's avatarmoxie

This is shameful and unconstitutional.  Should any form of regulation of the Internet be imposed by Congress, gambling or otherwise, then I say what's to stop Americans from using ISP's that originate outside of the US? 

Implementing an ISP based in a Costa Rica, Grand Cayman or Geneva is TOTALLY possible.  There are only about 10 backbone networks in the world and ISP's rent connections from those companies and sell the service to us.  Anyone can start an ISP.  I'd like to see them just try and regulate that!  Or are they going to tell me I can't shop overseas too!

WHAT LOSERS.  How about spending time on something a little more prudent, like GAS PRICES or the WAR maybe.

Rant

Saleo Paleo's avatarSaleo Paleo

Irregardless of what they do,we shall and will find a way to play if we want,my father has been dead for several yrs now and I'll be damned if they are going to take his place and tell me what I can spend my Us Dollar on.

Bradly_60's avatarBradly_60

I bet it is just the casino lobby trying to protect their interests.  I think it is a bunch of BS.  If it does pass there will be many legal challenges.

It seems a lot lately that the government of the US is really trying to restict the rights of the people.  It is kind of actually scary....we need to get rid of the Republican majority in the fall before we lose anymore rights.

Brad

LOTTOMIKE's avatarLOTTOMIKE

the united states is lost in a lot of different ways.think they'd want to block something like child porn or fight crime.but no this is very important.the whole country has been heading in the wrong direction for a while.too many important decisions made by the wrong people........

Peach3 $treet's avatarPeach3 $treet

This bill is up for debate on CSPAN1 right now. 

It would appear that it's passage in the House is considered a done deal, since Democrats (....praise those who truly care about America's working men and women!!....) have been using their rare opportunity for extended floor time to argue for an "up or down" vote on increasing the minimum wage, for the first time in 9 years.

Let's hope the waste-of-legislator's-time internet gambling bill dies in the Senate. 

konane's avatarkonane

Has anyone considered this may be a diversionary technique to draw our attention away from the real issue which is unfettered immigration (invasion), and implementing the treaty which combines Mexico, US and Canada into one large territory without borders???? 

Democrats overwhelmingly have voted FOR open borders and FOR amnesty as congressional votes have clearly demonstrated. 

A diversion is created when someone wants to slide something through that wouldn't be allowed under close scrutiny.

Check my blog for this article from World Net Daily which is a superb source of accurate and well researched information.

  https://blogs.lotterypost.com/konane/2006/7/the-new-world-disorder.htm

jim695

Whenever someone says, "It's not about the money," you can be assured of one thing: It's about the money.

I am a registered Republican, but my party seems determined now to transform this country into the New-Age Nazi Germany. Come November, I'm casting my vote for an independent candidate. This is more effective than simply not voting, as it takes away a vote from each of the two choices we have. Not that it's much of a choice. "Do you want to elect this crook, or would you rather have this theif represent his own interests above yours for the next four years?"

We're quickly headed for a two-class society; the upper class ensconced in gun turrets with high-powered rifles making sure the rest of us don't escape over the walls.

America has a history of revolution to overthrow tryanny, and I'm afraid the next one is not far off.

How much more do these people think we're going to take???

DoubleDown

Whenever someone says, "It's not about the money," you can be assured of one thing: It's about the money.

I am a registered Republican, but my party seems determined now to transform this country into the New-Age Nazi Germany. Come November, I'm casting my vote for an independent candidate. This is more effective than simply not voting, as it takes away a vote from each of the two choices we have. Not that it's much of a choice. "Do you want to elect this crook, or would you rather have this theif represent his own interests above yours for the next four years?"

We're quickly headed for a two-class society; the upper class ensconced in gun turrets with high-powered rifles making sure the rest of us don't escape over the walls.

America has a history of revolution to overthrow tryanny, and I'm afraid the next one is not far off.

How much more do these people think we're going to take???

I Agree!We can't take much more, that's for sure....

          DD

BevsPicks's avatarBevsPicks

As I speak right now the bill is getting beat down pretty bad. With 5 minutes to go. The vote is 51 Nay and 20 yea on the 4410. That's a good sign.

BevsPicks's avatarBevsPicks

I bet it is just the casino lobby trying to protect their interests.  I think it is a bunch of BS.  If it does pass there will be many legal challenges.

It seems a lot lately that the government of the US is really trying to restict the rights of the people.  It is kind of actually scary....we need to get rid of the Republican majority in the fall before we lose anymore rights.

Brad

I agree.I Agree!

Three2001

HR 4411 is passing right now.  Should we play that number while we can?  This CNN Pipeline is great with no access to TV at work.  You can watch these idiots at their work.

thinreality's avatarthinreality

Irregardless of what they do,we shall and will find a way to play if we want,my father has been dead for several yrs now and I'll be damned if they are going to take his place and tell me what I can spend my Us Dollar on.

This is exactly what they want: to control what you do.  The US government and the lobbyists who hang around Washington are extremely paternalistic. I agree with you, Saleo.  Count me in as another grown adult who can decide what is in my own best interests. 

It's true, there will always be people who choose their pursuits regardless of what is written on the books in D.C.

 

Todd's avatarTodd

I bet it is just the casino lobby trying to protect their interests.  I think it is a bunch of BS.  If it does pass there will be many legal challenges.

It seems a lot lately that the government of the US is really trying to restict the rights of the people.  It is kind of actually scary....we need to get rid of the Republican majority in the fall before we lose anymore rights.

Brad

Brad,

I know that you're a big liberal, and you can't stand conservatives, but that is just an out right lie.  In case you don't "get it", it is BOTH Democrats and Repblicans who are in on this stupid bill, and they are both to blame.

In fact, the guy who wrote the biggest dissenting view is a Republican from Texas.

I guess I'm just smart enough to know that there is a  big difference between congress coming unhinged on this stupid bill, and something as fundemental as protecting our country by keeping the liberals in the minority.

cps10's avatarcps10

I think that it won't pass anyway...the Senate is in no hurry to even table this stupid bill.

time*treat's avatartime*treat

Can I get a moat and drawbridge with my gun turret and walls?

In other news, my state is offering "lifetime" gun licenses.

Pay $100 and give 'em your info.

Anyone care to guess what's next? Can you say U.K. and Australia-style gun ban?

KY Floyd's avatarKY Floyd

I bet it is just the casino lobby trying to protect their interests.  I think it is a bunch of BS.  If it does pass there will be many legal challenges.

It seems a lot lately that the government of the US is really trying to restict the rights of the people.  It is kind of actually scary....we need to get rid of the Republican majority in the fall before we lose anymore rights.

Brad

I disagree that it's the casino lobby protecting their interests. I know that it's close to the same thing, but I think it's politicians protecting their campaign contributions. As far as getting rid of the republicans, that's only half of the battle.  There are about as many democrats, too. What we really need is a thorough house cleaning (the bad pun is unintended; the senate needs to go as well), and a voting population that's informed and doesn't just send the incumbents back to finance their nexyt campaign. Don't hold your breath, though.

As far as court challenges, I think they've got a major 1st amendment problem with any plans to block access to gambling sites. They have the authority to regulate (which can include a complete ban) online gambling, but not the free exchange of opinion and information about gambling.

 

KY Floyd's avatarKY Floyd

This is shameful and unconstitutional.  Should any form of regulation of the Internet be imposed by Congress, gambling or otherwise, then I say what's to stop Americans from using ISP's that originate outside of the US? 

Implementing an ISP based in a Costa Rica, Grand Cayman or Geneva is TOTALLY possible.  There are only about 10 backbone networks in the world and ISP's rent connections from those companies and sell the service to us.  Anyone can start an ISP.  I'd like to see them just try and regulate that!  Or are they going to tell me I can't shop overseas too!

WHAT LOSERS.  How about spending time on something a little more prudent, like GAS PRICES or the WAR maybe.

Rant

what's to stop Americans from using ISP's that originate outside of the US? 

Well, for starters there's the way the internet works. If you follow your phone line or your cable you'll find that the other end isn't in a different country.  I suppose you could subscribe to a foreign ISP's satelite connection if you don't mind the long distance charges for the uplink over phone lines. If you do manage to get service through a foreign provider you'll need one that's willing to violate the US laws that would apply to any business they conduct within the US, which would include servicing any requests originating from your computer, which I presume is located in the US.

Just6ntlc

If online gambling rights are eliminated, I would be happy. For example, after poker professional Mike "The Mouth" Matusow won $1 million at 2005 WSOP main event, he spent about half of his winnings gambling online. Then his parents took it the internet away from him.

Littleoldlady's avatarLittleoldlady

My, my.  I am so impressed with our government officials.  They are doing their very best to manipulate where and how I spend my money.  If they get rid of internet gambling..I betcha that "other forms" will be back shortly.  I remember number games played in your own neighborhood.  They can't legislate morality and why they are still trying is beyond me.  I wonder how many of our tax dollars they used with this garbage.  We have a full plate with the costs of the war, veteran's care, illegal aliens (coming in droves), high gas prices, high grocery prices, jobs being lost and not recovered, areas of the country that are being rebuilt and more areas being wrecked as we speak, homeless Americans, terrorism,illegal drugs, and some idiot is crying about internet gambling.  They didn't cry this loud when gas was $4.00 a gallon. 

LOTTOMIKE's avatarLOTTOMIKE

i agree littleoldlady.while the bastards drive their mercedes and eat at upscale restaurants then head to their million dollar penthouses i do think this makes them out of touch with the everyday american who just likes everday things like a good cooked meal,couple of beers and something to gamble on every now and then.if they could tax me going to the bathroom i bet they would.me vote???  i wouldn't vote for none of these sleazy creeps.they are all the same.smile and lie to your face while swearing on their kids they are telling you the truth......

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