Anti-UIGEA Bill Hearing Goes Off Well

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The hearing for the Internet Gambling Regulation, Consumer Protection and Enforcement Act of 2009 (H.R. 2267), also known as the anti-UIGEA bill, took place before the House Financial Services Committee on December 3. The general consensus was that the hearing projected a favorable picture for the regulation of online gambling.

Chairman of the committee and sponsor of the anti-UIGEA bill, Barney Frank, made the opening statement. He highlighted that the Government cannot tell adult Americans "what they should with their own money on their own time on their own computer". He went on to say that there were several things on the Internet that were unsuitable for minors. Banning all those things just because some people may have abused the system is a threat to individual liberty.

Several experts testified that technologies were available to overcome the so called ills of Internet gambling such as underage gambling, compulsive gambling, money laundering, fraud and identity theft. Parry Aftab of WiredSafety, the Internet safety and help group, said that relevant technologies were being used in other Internet based industries and could be adapted to online gambling. The technologies are continuously improving as well. Professor Malcolm K. Sparrow of Harvard University cited his study that had concluded that combining regulation with education, technology and support would offer better protection to online casino players.

Samuel Vallandingham, representing the Independent Community Bankers of America, stated that the banking community will never be able to comply with the UIGEA rules. In order to meet the new rules the banking community would have to withdraw resources from combating terror and money laundering, from complying with the regulations imposed by the financial crisis and even from the day to day transactions. He added that the whole issue was made more difficult because no clear definition of illegal online gambling exists. Therefore he said that the banking industry was firmly supporting Frank’s bill.

The opponents of Internet gambling also spoke at the hearing. They were led by Republican Spencer Bachus, who insisted that the UIGEA should be implemented as soon as possible. In a new argument he referred to an FBI letter that claimed that collusion was possible in online gambling. Opposition on a different front came from Robert Martin, tribal chairman of the Morongo Band of Mission Indians in California. Martin claimed that legalizing online gambling would be hurt the gambling rights given to Indians. Barney Frank refuted this claim, pointing out that the Morongo had tried to enact laws in California that would give them exclusive control over Internet gambling.

Barney Frank closed the hearing stating that the House Financial Services Committee would set another date next year for debate and mark up. There was no vote taken at this hearing.

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