China, U.S. Lag Behind in Internet Gambling Laws

February 27th, 2011 Topper Posted in Barney Frank, Gambling Law, Gambling Laws, Unlawful Internet Gambling Enforcement Act No Comments »

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China and the United States are the two most influential countries in the world when it comes to free trade and World Trade Organization (WTO) commitment compliance. Ironically, both countries claim that compliance is essential, yet neither has demonstrated that through their online poker and Internet gambling laws.

The U.S. is already in trouble with the European Commission, which has given our lawmakers a grace period so they can clean up Internet gambling legislation and be in compliance with European Union trade agreements. The U.S. has yet to heed the warning, though, and the next step would be for the European Union to bring the case to the WTO.

But if Representative Barney Frank has his way, the Unlawful Internet Gambling Enforcement Act of 2006 (UIGEA) will be repealed and the U.S. will be on its way to a more progressive policy on Internet gambling. Frank has long recognized that millions of people in the U.S. want to be free to gamble online legally — no matter whether they want to play pai gow poker, slots, roulette or any of the other games of chance available online — and that taxation of the online gambling industry could provide financial windfalls at every governmental level. He’s been busy gathering support in the House of Representatives for his bill and just added his 50th and 51st official supporters last week.

China has not come quite as far as the U.S. when it comes to overhauling their Internet gambling laws. The Chinese government has mandated filters, which prevent citizens from accessing Internet casino gambling sites. In fact, the Chinese government’s stance on Internet gambling is so oppressive, as recent as February of 2010 a Chinese Web site developer was sentenced to six years and ordered to pay a fine of 5 million yuan ($735,000 dollars) for his role in building casino gambling Web sites. Nineteen other Chinese men who were involved were also given prison terms ranging from one to five years and fines of 20,000 yuan to one million yuan.

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Online Poker World Waits While UIGEA is Delayed

January 18th, 2010 Topper Posted in Barney Frank, Gambling Laws, Online Poker, Unlawful Internet Gambling Enforcement Act 1 Comment »

flying dice imageAficionados of online casino gambling in general and online poker in particular will now have to wait until June 1, 2010, to see their fate in the United States. December 1, 2009, was supposed to be the deadline for implementation of the Unlawful Internet Gambling Enforcement Act (UIGEA), a mangled mix of regulations that put the onus on U.S. financial institutions to enforce who can and cannot gamble online in the United States. This regulation doesn’t affect non-paid Internet gambling, such as free blackjack, bingo or poker that just pay out play chips, but it’s literally do or die for gambling sites that deal in U.S. dollars.

It’s not surprising that the Federal Reserve Board of Governors and the Department of the Treasury jointly announced the six-month delay, because financial institutions were in an uproar over how to implement it. The UIGEA, which was hastily tacked onto the Safe Port Act in the last session of Congress in 2006, forces financial institutions to block unlawful Internet gambling transactions. Yet the bill did little to define what would be considered unlawful. The result was that in the absence of clear guidelines, financial institutions would have no choice but to block their customers’ transactions with online gambling sites, including wagers placed on horse racing and the purchase of state lottery tickets.

Proponents of UIGEA modification now have until June 1, 2010, to convince Congress that not only is the bill unfair, but that it also blocks a huge source of tax revenue at a time when the country could really use it.  As John Pappas, the executive director of the Poker Players Alliance (PPA), an advocacy organization with a major stake in the outcome of this fight, says,  “In these trying economic times, we’re the only industry that’s coming forward and saying, ‘Here’s a pile of money!’”

The six-month delay came about because of a petition filed by the PPA, the National Thoroughbred Racing Association and the American Greyhound Track Operators Association, which would all face similar problems if the UIGEA were implemented as is. But the PPA and many others realize that altering the UIGEA won’t provide strong enough regulation for the online gambling industry. That’s why they also stand firmly behind Representative Barney Frank’s H.R. 2267 and Senator Robert Menendez’s S. 1597, which would provide protection for underage and compulsive gamblers.

You can be sure that all stakeholders will be busy for the next six months trying to convince any lawmakers not already on-board that online gambling is not a crime and that it’s time for realistic legislation that benefits everyone involved.

Flying dice photo by G & A Scholiers (TouTouke on sxc.hu)