The debate on online gambling heated up in the US, after a Congress hearing for two bills (HR2266 and HR2267), aimed at legalising online gambling, was scheduled for 3 December. HR2266 aims to delay by one year the entry into force of the Unlawful Internet Gambling Enforcement Act (UIGEA). UIGEA was due to come into effect on 1 December, but its implementation has been delayed until June 2010.
HR2267, known as the Internet Gambling Regulation, Consumer Protection, and Enforcement Act (IGRCP), aims to legalise online poker games in the US. The bill would give the US Treasury Department the authority to establish regulations and license internet gambling operators. Frank Fahrenkopf Jr., President of the American Gaming Association (AGA), said, in a speech at the Global Gaming Expo in Last Vegas, last month, that online gambling could be a good alternative to generate new tax revenues.“Any Congressman or Senator who introduces a piece of legislation that is going to cost something will also have to show how they are going to pay for it”, said Fahrenkopf. “They will be looking around at a place to get additional revenue.”
A study by Pricewaterhouse Coopers demonstrated that taxes on regulated internet gambling could collect up to $63 billion in the next ten years. Senator Ron Wyden (Oregon) proposed an amendment to HR2267 in September, stating that tax revenue generated through the bill should be dedicated to health care reform. Wyden withdrew the proposal a week later, saying “he did not want to increase any controversy already facing the health care package”. Michael Waxman, spokesperson for the Safe and Secure Internet Gambling Initiative, said: “The Senate Finance Committee should approve the resolution, finally putting an end a failed prohibition on internet gambling that leaves Americans unprotected and unlicensed offshore operators as the only beneficiary in a thriving marketplace”.
The 1961 Wire Act was the basis for the US online gambling ban in the past. However, the US Court of Appeals confirmed in 2002 in ‘Thompson v. Mastercard’ a lower court’s ruling according to which casino games are legal. Although enforcement of the UIGEA has been delayed until June 2010, section eight of the Safe Port Act 2006 makes it illegal for banks and credit card companies to process payments on gambling websites, effectively banning online gambling.