Despite the support of 115 members of Congress and an array of anti-gambling, religious, and conservative groups, the recently proposed U.S. federal law outlawing online gambling could go down in flames, said a gambling industry researcher.
Even if the law passes, it may have little effect on the current state of online gambling in the United States, said Christopher Costigan, president of Gambling911.com, a gambling entertainment and information web site.
“This law has been kicking around for years,” he said. “This law makes it more difficult for banks to accept credit cards for online gambling purposes, but the Patriot Act has already done that. The online gambling firms are using overseas banks for these purposes.”
Mr. Costigan doubts the legislation will be passed. He believes that the supporters of the bill, not its opponents, will cause the defeat of the proposed legislation.
He said that organizations such as the Christian Coalition, the National Coalition Against Gambling Expansion, and the Family Research Council, which have come out in support of the legislation, will eventually torpedo the bill.
“Every time they have tried to pass this bill, the religious groups have ended up opposing the bills because of all the exemptions the bill picks up along the way,” said Mr. Costigan. “The horse trading happens, different groups such as Native American casinos get exemptions, and the religious groups drop their support of the bill.”
Gambling’s Legal Void
Online gambling legislation has been defeated about four times over the past decade and as recently as 2002. As a result, online gambling in the U.S. has occupied a strange legal void.
Current federal law does not address online gambling. State law, which has severely limited jurisdiction over the global Internet, has been inadequate for the most part.
The Internet Gambling Act, introduced on Thursday by Reps. Bob Goodlatte (R-Virginia) and Rick Boucher (D-Virginia), targets the financial settlement part of wagering transactions by prohibiting gambling enterprises from accepting certain forms of payment, including credit cards, checks, and wire and Internet transfers, to satisfy gambling debts (see Feds Bust Net Bets).
The bill increases the penalty for violation of the law from two to five years. It also broadens the definition of gambling to include new gambling material such as fantasy sports leagues.
“Most U.S. banks won’t touch online gambling settlements as it is,” said Mr. Costigan. “They use Neteller, a publicly traded clearing house that focuses on online gambling.”
Neteller is an online funds transfer service based in Douglas, Isle of Man. The company claims a user base of 2.3 million people who posted $3.4 billion in transactions in 2004. More than 1,700 online merchants accept payments through Neteller’s system.
“Even if this bill, against all odds, happens to pass, it will not kill the industry,” said Mr. Costigan. “State bans on advertising have had some effect on the marketing side. But there is always some media that are willing to take ads.”
There has been at least one challenge of U.S. law banning the advertising of online gambling. Casino City, a gambling information web site based in Baton Rouge, Louisiana, filed a complaint against the U.S. Department of Justice in U.S. District Court seeking a declaratory judgment. The company filed the suit on free speech grounds.
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Even if the law passes, it may have little effect on the current state of online gambling in the United States, said Christopher Costigan, president of Gambling911.com, a gambling entertainment and information web site.
“This law has been kicking around for years,” he said. “This law makes it more difficult for banks to accept credit cards for online gambling purposes, but the Patriot Act has already done that. The online gambling firms are using overseas banks for these purposes.”
Mr. Costigan doubts the legislation will be passed. He believes that the supporters of the bill, not its opponents, will cause the defeat of the proposed legislation.
He said that organizations such as the Christian Coalition, the National Coalition Against Gambling Expansion, and the Family Research Council, which have come out in support of the legislation, will eventually torpedo the bill.
“Every time they have tried to pass this bill, the religious groups have ended up opposing the bills because of all the exemptions the bill picks up along the way,” said Mr. Costigan. “The horse trading happens, different groups such as Native American casinos get exemptions, and the religious groups drop their support of the bill.”
Gambling’s Legal Void
Online gambling legislation has been defeated about four times over the past decade and as recently as 2002. As a result, online gambling in the U.S. has occupied a strange legal void.
Current federal law does not address online gambling. State law, which has severely limited jurisdiction over the global Internet, has been inadequate for the most part.
The Internet Gambling Act, introduced on Thursday by Reps. Bob Goodlatte (R-Virginia) and Rick Boucher (D-Virginia), targets the financial settlement part of wagering transactions by prohibiting gambling enterprises from accepting certain forms of payment, including credit cards, checks, and wire and Internet transfers, to satisfy gambling debts (see Feds Bust Net Bets).
The bill increases the penalty for violation of the law from two to five years. It also broadens the definition of gambling to include new gambling material such as fantasy sports leagues.
“Most U.S. banks won’t touch online gambling settlements as it is,” said Mr. Costigan. “They use Neteller, a publicly traded clearing house that focuses on online gambling.”
Neteller is an online funds transfer service based in Douglas, Isle of Man. The company claims a user base of 2.3 million people who posted $3.4 billion in transactions in 2004. More than 1,700 online merchants accept payments through Neteller’s system.
“Even if this bill, against all odds, happens to pass, it will not kill the industry,” said Mr. Costigan. “State bans on advertising have had some effect on the marketing side. But there is always some media that are willing to take ads.”
There has been at least one challenge of U.S. law banning the advertising of online gambling. Casino City, a gambling information web site based in Baton Rouge, Louisiana, filed a complaint against the U.S. Department of Justice in U.S. District Court seeking a declaratory judgment. The company filed the suit on free speech grounds.
http://www.redherring.com