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Stop work on enforcing Web gambling ban, lawmakers urge

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Super Moderator
Feb 20, 2008
Stop work on enforcing Web gambling ban, lawmakers urge
23 April 2008

by Tony Batt

Las Vegas Gaming Wire

WASHINGTON, D.C. -- Work on federal regulations to enforce an Internet gambling ban should stop, four lawmakers said in letters this week to Federal Reserve Chairman Ben Bernanke and Treasury Secretary Henry Paulson.

"Given the many other priorities that are pending at your agencies, including the mortgage crisis ... we believe it would be imprudent for you to devote additional agency resources to this Sisyphean task," the lawmakers wrote. Sisyphus was a king in Greek mythology who was condemned to repeatedly roll a huge boulder up a hill only to watch it roll down again.

House Financial Services Committee Chairman Barney Frank, D-Mass., and three other committee members -- Reps. Ron Paul, R-Texas; Luis Gutierrez, D-Ill.; and Peter King, D-N.Y. -- signed the letters that were issued Monday.

Brookly McLaughlin, deputy assistant secretary for public affairs at the Treasury Department, said, "We are committed to giving fair consideration for all comments as the rulemaking process proceeds."

Federal Reserve spokeswoman Susan Stawick declined comment.

The letters follow an April 2 House hearing where representatives of the financial agencies said they were struggling to write regulations to carry out the gaming restrictions Congress passed in 2006.

Louise Roseman, director of bank operations and payment systems for the Federal Reserve, testified an Internet gambling ban cannot be "ironclad."

Roseman and Valerie Abend, a deputy assistant secretary for the Treasury Department, agreed the 2006 legislation does not define "unlawful Internet gambling."

After that hearing, Frank and Paul introduced a bill to prevent the Federal Reserve and Treasury Department from going forward with regulations to implement the Internet gambling ban.

In their letters this week the lawmakers served notice that they intended to "vigorously pursue" legislation to shelve the rules, thus blocking the Internet gambling ban from taking full effect.

Frank also introduced a bill last year to scrap the ban and require the Department of Treasury to regulate Internet gambling in the United States.

Another sign that opposition may be growing came Tuesday with the announcement by the Poker Players Alliance, a lobbying group seeking an exemption from the ban, that its membership has reached 1 million.

Rep. Dean Heller, R-Nev., who is a member of the financial services committee, said in a statement he is "not yet convinced that the rulemaking process should be dropped altogether at this point."

Rep. Jon Porter, R-Nev., said the letters underscored the need for a federal study of Internet gambling.

"The point is the (Bush) administration and Congress do not have a road map to make the regulations," Porter said.

Heller and Porter are co-sponsoring a bill by Rep. Shelley Berkley, D-Nev., to appoint the National Research Council of the National Academy of Sciences to study Internet gambling for one year.

"Those pushing these regulations in the face of strong opposition are more concerned with scoring political points than they are about protecting the rights of adults in the U.S. or the actual cost of implementing this truly Byzantine law," Berkley said in a statement.


Staff member
Jan 14, 2008
Lawmakers: Treasury Should Not Waste Time on Online Gambling

A bipartisan group of House Financial Services Committee members have warned U.S. Treasury and Federal Reserve officials not to waste any more time trying to implement a ban on online gambling.

Rep. Barney Frank (D-Mass.), the chairman of the panel, along with Reps. Luis Gutierrez (D-Ill.), Ron Paul (R-Texas) and Pete King (R-N.Y.), sent a letter Tuesday to Treasury Secretary Henry Paulson and Federal Reserve Chairman Ben Bernanke telling them to hold off on writing new regulations based on the law governing Internet gambling, which was approved by the Republican-majority Congress in 2006.

The lawmakers, who said they are determined to overturn the law, highlighted issues they said are more important priorities for the nation's financial institutions, such as the home mortgage crisis.

"We believe it would be imprudent for you to devote additional agency resources to this Sisyphean task, especially as we intend to vigorously pursue legislation to prevent the implementation of these regulations," the members said.

The 2006 law fails to define the term "unlawful Internet gambling," leaving it up to banks and financial institutions to reconcile the conflicting state and federal laws and court decisions when determining whether to process a transaction, the members wrote. Some of the information needed to make the determination could be unavailable to banks because customers or financial institutions in foreign countries may be unlikely to provide it.

The letter follows a Financial Services Committee hearing early this month at which Treasury and Federal Reserve officials described the regulations implementing an online gambling ban as vague, confusing and burdensome.

Frank and Paul have introduced legislation that would prohibit the implementation of the law's regulations.

The letter was sent the same day the Poker Players Alliance announced that its membership had reached 1 million. The group also announced the launch of a voter registration program and a political action committee.