In a Congress preoccupied by the economy, the Poker Players Allaince knew it would take some populist bluffing to repeal a law effectively outlawing poker Web sites. The group, whose chairman is former New York Republican Sen. Alfonse D’Amato, rallied the champions among its one million members to win a spot on the agendas of lawmakers guiding financial-services legislation.
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As bartenders begin crushing mint for juleps in preparation for this Saturday’s Kentucky Derby, often called the most exciting two minutes in sports, a much slower process is unfolding that could have implications for future online wagers in the horse-racing industry.
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Robert Williamson wobbled wearily into the conference room thirty minutes late for a 9am meeting and sat down without making an excuse. He didn’t need one. He’s a professional poker player.
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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.

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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.
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The deck may still be stacked against online poker enthusiasts, but an advocacy group that represents them is suddenly holding a whole lot of chips.

The Poker Players Alliance is expected to announce Tuesday that it has registered more than one million members and will be organizing both a political action committee and a voter-registration drive as part of its If You Play, Have a Say campaign.
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The banking industry is cheering a fresh assault on the 2006 federal crackdown on Internet gambling by an unlikely duo: House Financial Services panel Chairman Barney Frank (D-Mass.) and Rep. Ron Paul (R-Texas).

Frank has teamed up with the libertarian-minded Paul, who crusaded against big government during his recent White House bid, on legislation to block that law by forbidding federal officials from writing rules to implement it.

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Regulations to enforce an Internet gambling ban would be blocked under a bill introduced this week by Rep. Barney Frank, D-Mass., chairman of the House Financial Services Committee.

“These regulations are impossible to implement without placing a significant burden on the payments system and financial institutions,” Frank said in a statement on Friday.

Frank’s bill, which is co-sponsored by Rep. Ron Paul, R-Texas, was introduced Thursday and would prohibit the Department of Treasury and the Federal Reserve from proposing regulations to enforce the Internet gambling ban enacted in 2006.

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Washington, DC—House Financial Services Committee Chairman Barney Frank (D-MA) and senior Financial Services Committee member Ron Paul (R-TX) have introduced legislation to prohibit the federal government from issuing regulations called for in the called for in the Unlawful Internet Gambling Enforcement Act of 2006.  The legislation, H.R. 5767, will forbid the Secretary of the Treasury and the Board of Governors of the Federal Reserve System from proposing, prescribing, or implementing any regulation that requires the financial services industry to identify and block internet gambling transactions.

“These regulations are impossible to implement without placing a significant burden on the payments system and financial institutions, and while I do disagree with the underlying objective of the Act, I believe that even those who agree with it ought to be concerned about the regulations’ impact,” said Rep. Frank.

“The ban on Internet gambling infringes upon two freedoms that are important to many Americans: the ability to do with their money as they see fit, and the freedom from government interference with the Internet. The regulations and underlying bill also force financial institutions to act as law enforcement officers. This is another pernicious trend that has accelerated in the aftermath of the Patriot Act, the deputization of private businesses to perform intrusive enforcement and surveillance functions that the federal government is unwilling to perform on its own,” said Rep. Paul.

Specifically, at issue is the fact that the regulations, like the underlying legislation, fail to define the term “unlawful internet gambling,” leaving it to each financial institution to reconcile conflicting state and federal laws, court decisions and inconsistent Department of Justice interpretation, when determining whether to process a transaction.  Furthermore, some of the information needed to make this determination would likely be unavailable to banks, either because customers or financial institutions in foreign jurisdictions are unwilling or unable to provide it.  At the hearing, the regulators themselves admitted that there are substantial problems in crafting regulations to implement the UIGEA that does not have a substantial adverse effect on the efficiency of the nation’s payment system.  

Chairman Frank and Congressman Paul opposed the UIGEA, and the two have been working on legislation, H.R. 2046 that would license and regulate online gaming.  However, it was clear at the hearing that the regulations are unworkable for the financial services industry, and this bill would, therefore prohibit their implementation.  

On Wednesday, April 2, the DIMP Subcommittee held a hearing “Proposed UIGEA Regulations: Burden Without Benefit?” to examine the regulations issued last year by the Federal Reserve and Treasury on the Unlawful Internet Gambling Enforcement Act, which garnered more than 200 comment letters. 

Click here to go to the press release.

A trans-Atlantic spat over online gambling may help
rewrite the rules of the game for Internet commerce across borders. For
a change, the Europeans stand on the side of free trade, while America
dabbles in regulatory overreach.

The European Union last month launched an internal
probe into whether the U.S. Justice Department selectively enforces its
antigambling laws against European online firms that offer wagers on
sports events. Brussels is making a narrow legal point that Washington
discriminates against Europeans by simultaneously permitting U.S.
Internet horse betting. That’s against World Trade Organization rules,
and the case may end up there.

The U.S. last year lost a similar WTO online gambling
case against Antigua and Barbuda. The island nation argued that U.S.
online gambling rules violated Washington’s GATT commitments to open
its market in “recreational, cultural and sporting services.” The U.S.
countered that its policies were justified to protect public morals and
public order, a legitimate exception under WTO rules. But the WTO panel
ruled that America wasn’t applying its restrictions equally to
foreigners and domestic operators. U.S. online horse-betting sites
aren’t banned.

Washington could have stood down then. Instead, it is
“threatening and pressing criminal prosecutions, forfeitures and other
enforcement actions against foreign online gaming operators,” according
to the London-based Remote Gambling Association, which took the
complaint to the EU. In doing so, Washington is also practicing a form
of universal jurisdiction by applying domestic law to foreigners beyond
its borders – a legal interpretation that the U.S. has, rightly,
condemned in other cases.

In 2006, the former chairman of U.K.-based gambling
firm Sportingbet, Peter Dicks, was detained in New York. The Briton was
wanted in Louisiana on online gambling charges. Then-New York Governor
George Pataki declined to sign a warrant extraditing him, and he was
released. Many European industry executives now no longer stop over in
the U.S., let alone visit the country, for fear of arrest. “There is a
list of wanted people but nobody knows who’s on it,” said Clive
Hawswood of the Remote Gambling Association.

Click here to go to the article and read more.