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Bill to Regulate Online Poker Takes Next Step

In a step in the right direction for online poker advocates, the House Financial Services Committee has approved HR 2267: the Internet Gambling Regulation, Consumer Protection and Enforcement Act by a vote of 41-22-1.  The bill which, among other things, seeks to repeal the Unlawful Internet Gaming and Enforcement Act (UIGEA), will still need approval from the full House of Representatives to continue on its path to becoming law.  The earliest timeframe for the bill to come up for a vote would be mid-September.  In order for the bill to come to the floor, Speaker of the House, Nancy Pelosi would need to schedule a vote.

The bill passed with the help of a decent amount of bipartisan support.  Seven republicans joined thirty-four democrats in voting aye.  One Republican, Ron Paul (R-TX), voted "present" but stopped short of voting yes. HR 2267: the Internet Gambling Regulation, Consumer Protection and Enforcement Act

According to Rep. Paul, he supports the bill as "a means to repeal the total ban on internet gaming".  Paul supports repealing the ban on internet gaming because it infringes upon two freedoms: the ability for individuals to do with their money as they see fit, and the freedom from government interference with the Internet.  But Paul also strongly urged his colleagues to "oppose any attempt to tax internet gambling".  He went on to say, "...taxing any commercial transaction... will cripple the development of Internet commerce." 

The statements made by Paul reveal the double edged sword of regulating Internet gaming.  On the one hand, regulating gaming will make it easier and more accessible for Americans to play games of skill on the Internet, but conversely with the government involved the threat of taxation becomes more prevalent. 

Despite the threat of more taxation, the Poker Player's Alliance (PPA) was quick to praise the passage of the bill from committee.  In a press release, the PPA said, "The bipartisan 42-22 vote demonstrates that sensible regulation of Internet gaming is gaining support in Congress while prohibition continues to fail." 

Though the bill passed with flying colors, it was not without significant debate and numerous material amendments.  One amendment authored and pushed by John Campbell (R-CA) changed consumer protection language in the bill which would allow states and tribal authorities equal authority to administer licenses and enforce the new regulations.  Another provision from Spencer Bachus (R-AL) specified certain companies as "bad actors" (those who had deliberately evaded or violated U.S. law regarding online gaming).  These companies, which include the likes of Full Tilt and PokerStars, would not be able to obtain licenses. 

Additional key points and amendments in the bill include:

  • The U.S. Treasury Department will take charge of the actual regulation of gambling sites
  • Sports betting on the Internet will be illegal
  • Credit cards will not be allowed to fund player accounts.  However, Debit cards will be permissible.
  • Loss limits will be put in place for players
  • Ads targeted at minors are prohibited
  • Problem gamblers will be allowed to ban themselves from any gambling site
  • The facilities used by online gamblers in the U.S. (payment processors, servers, etc.) must be located in the United States (as do a majority of the employees working for the site)

While the road to passage is still filled with peril, the prospects of legalization seem a bit brighter today.  To write your Congressperson about this issue, please visit http://capwiz.com/pokerplayersalliance/home/


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