HR4411 - tomorrow is the big day...

[bdawg31]

I think the Nevada representative should take some hard-line anti-gambling stance. Just go off on all forms of gambling altogether and say that it should all be illegal. That would do wonders for her re-election campaign in Nevada.

[Penguinfan]

I believe Nevada was the first to ban internet gambling on a state level, could be wrong about that.

[Reel Deal]

I'm just glad Congress is there to protect me from myself for without their guidance I'm quite certain I'd be a homeless drunk right now.

[Kurn]

You are correct, sir. Online gambling has been illegal in NV for years.

[Boobie Lover]

She just put in an amendment that would ban ALL internet gambling.

[bdawg31]

That would make sense for someone from Nevada to say that. Hypocritical - but it makes sense.

[Penguinfan]

And we get no vote at all, VERY NICE.

This is actually a good thing for us believe it or not.

[GeoffM]

A good strategy may be to start carrying small bankroll amounts online. I can foresee Neteller closing up shop with our money if poker is no longer a valid merchant for them (I'd guesstimate well over 50% of their business is in poker related transactions).

[Talking Poker]

I think this is completely ridiculous advice. Seriously, I think the guy looking for 10 cents in the Backer section had more logic in his post.

[GeoffM]

I'd just hate to see online poker getting banned quicktime and having the tsunami of a lifetime. Some people have life savings online.

[sjay2k]

Getting rolled by NETeller = LOL

[GeoffM]

Huh?

[jillaj]

I think the rest of the world has enough poker players for them to continue their service.

[GeoffM]

You sure? The article does state that about half of online poker players are American, and that doesn't seem too far out of whack.

[PShabi]

How's that?

[sjay2k]

Come live in Australia, we have a relatively sensible/libertarian government and gambling is not taxable

Also cleansing ales are plentiful

[Penguinfan]

The longer there is no decision the longer we have no problem. Possibly the idiots who wrote the bill don't get re-elected and the issue goes away.

But in any event it can't go to the Senate without a vote from the House and can't become law without going to the Senate.

[Kurn]

She's doing this for a reason. If the carve-out for horse racing is eliminated, the reps from the racing states will jump off the bandwagon.

[Talking Poker]

This is VERY encouraging. I love when things are explained to me in small words.

From Card Player:


-----
published on: Wednesday Jul 12, 2006
CardPlayer.com Explains Unlawful Internet Gambling Enforcement Act

Amended Bill Doesn't Mention Online Poker Players

Confusion in the Press

There seems to be some confusion in the press regarding what bill just passed in Congress. It has been reported that the “Goodlatte” bill passed in the House. Actually what is referred to as the Goodlatte Bill, introduced by Rep. Bob Goodlatte, R-Va, is H.R. 4777, which was fraught with problems previously reported by CardPlayer. Click . The common name of that bill was the “Internet Gambling Prohibition Act.”

Another milder bill was introduced by Rep. Jim Leach, an Iowa Republican. That bill, commonly known as the “Unlawful Internet Gambling Enforcement Act,” is H.R. 4411, which basically prohibits credit card companies and financial institutions from sending payment to gaming sites.
The bill that passed was an amended version of H.R. 4411, which is the Leach bill that added some of Goodlatte’s proposals. Before this bill becomes law, it must pass both the House and the Senate. Currently, there is no commensurate bill pending in the Senate.

Poker Players Are Not at Risk
The first thing to note is that the bill does not prohibit a poker enthusiast from playing online poker. One Democrat introduced such an amendment to demonstrate the hypocrisy of the bill, but the amendment failed. There is no mention of the poker player in the bill nor any penalty associated with playing poker.

H.R. 4411
After almost four hours of debate, the bill passed by a vote of 317-93. In a nutshell, here’s the meat of the statute and the predictable problems associated with each section of the bill.
Online gaming sites are prohibited from accepting payment from a United States financial institution. Since all online sites are outside of the United States, our government has no jurisdiction to enforce this part of the law. Simply stated, the United States cannot make laws or enforce laws regarding business outside the United States.

Financial institutions are forbidden from delivering funds to online gaming sites. However, most banks and credit card companies already refuse to send money to offshore sites. Therefore, offshore third-party companies have already been set in motion to handle United States financial transactions.

The amended 1961 Wire Act modernizes its language by including the Internet and prohibiting games “predominantly subject to chance.” This will be the start of expensive and time-consuming litigation regarding whether poker is predominantly a game of skill or chance.
A burden is placed upon Internet service providers and other technology providers to block access to online gambling sites when requested to do so by a law enforcement agency. This will prove to be an unenforceable nightmare for all involved.

The bill directs the Department of the Treasury and the Federal Reserve to issue regulations outlining policies and procedures that could be used by financial institutions to identify and block gambling-related transactions that are transmitted through their payment systems. If the bill ever becomes law, these entities have 270 days to write such procedures. The implementation is mind boggling.

The bill contains carve-outs for such things as lotteries, horse racing, and the stock market. Every opponent of the bill criticizes the bill because, while it attempts to legislate morality, it prohibits only certain forms of gambling while allowing others.

As a matter of fact, although the proponents of the bill say that online gaming is destroying the moral fiber of society, the bill allows a state to house an online gaming site for its citizens.

Political Motivation

The bill was clearly politically motivated by Republicans who are worried about losing control in the House after the November election. Last month, House Republican leaders announced that this bill would be part of a 10-part “American Values Agenda,” which consists of 10 unrelated pieces of legislation, including a constitutional amendment prohibiting same-sex marriage, tax cuts, a flag burning law, and extensive restrictions on stem cell research.

Furthermore, this is a way our legislators can separate themselves from the now-disgraced lobbyist Jack Abramoff, who lobbied against previous versions of this bill using bribes, fraud, and hundreds of thousands of dollars to assist in the bill’s defeat.

The Future Players

As I see it, there are a number of players and organizations to be watching in the near future. Although Senate leaders have not identified the bill as a top priority, Arizona Republican Jon Kyl has pledged to pursue a similar bill in the Senate.

Frank J. Fahrenkopf Jr., the American Gaming Association president, recently announced that the AGA supports a study of the feasibility of regulating online gaming.

The White House’s Office of Management and Budget said that although it supports the House’s vote, it has concerns about the bill.

Sam Vallandingham, vice president for the First State Bank in West Virginia has said, “Our concern is that the added burden of monitoring all payment transactions for the taint of Internet gambling will drain finite resources currently engaged in complying with anti-terrorism, anti-money laundering regulations, and daily operation of our bank.”

U.S. Rep. Barney Frank, D-Mass., and U.S. Rep. Ron Paul, R-Texas, continue to vocally oppose the bill: “Prohibition didn’t work for alcohol, and it won’t work for gambling,” Frank said. Paul agreed, adding, “the only thing (prohibition) does is increase the price.”

U.S. Rep. Shelley Berkley, D-Nevada, offered an amendment that would have eliminated what she called the “hypocritical exemption” by completely banning all forms of Internet gambling. It failed by a vote of 114-297.

My favorite Representative, Rep. John Conyers, D-Michigan, also offered such an amendment. He called all the exceptions and carve-outs “loopholes as big as a barn door.”

The Poker Players Alliance is another group to be watched. Reuters reported that regulating Internet poker instead of banning it could bring the U.S. government $3.3 billion in taxes annually, according to a study by the Poker Players Alliance. Income taxes on winnings from Internet poker alone — which is estimated to have attracted $60 billion in wagers worldwide in 2005 — could amount to $2.5 billion each year. The study also said that a 1 percent user fee on online poker transactions would generate another $800 million to $1 billion in revenue per year for the U.S. government.

Finally, Rep. Jim Kasper from North Dakota should be watched as well. I had the pleasure of speaking with him this morning. He informed me that he was in contact with AGA president Frank J. Fahrenkopf Jr., discussing possible ramifications of the bill.

Rep Kasper told me: “I intend to draft the Legislation to allow any Internet company located in North Dakota to be able to do business worldwide, not just in North Dakota. If the DOJ or the Congress try to stop us, it is my intention that the state of North Dakota initiate legal proceedings in federal court, to have the courts rule on the Constitutional issues. And, I am looking for input and help from the gaming industry in the drafting of the new bills.” Representative Jim Kasper can be reached at .

In conclusion, I will reiterate what I have predicted every year for about the last 10 years. My prediction is that no law will pass in 2006 banning online gaming. The attempts are more complicated but no more feasible than they have ever been. Online gaming is a $12 billion a year business that is here to stay. Show your support for the right to play online by going to and sending a letter to your Congressional representatives opposing this legislation.