HR2267, The Internet Gambling Regulation, Consumer Protection, and Enforcement Act (To amend Title 31, United States Code, to provide for the licensing of Internet gambling activities by the Secretary of the Treasury, to provide for consumer protections on the Internet, to enforce the tax code, and for other purposes) was not marked up for committee and languishes in a mid-term election limbo. But don't confuse Frank's previous 'Internet Gambing Regulation and Enforcement Act of 2007 (IGREA)' with this new one, even though the new bill bears several similarities.
The 'party of change' had two years to get this done and it simply didn't happen. It's no surprise that a major obstacle has been a senator from Nevada. Nevada has been hard hit by the economic downturn and brick and mortar gambling is obviously a large part of the total Nevada economy.
Senator Harry M. Reid (D-Nevada) the Senate Majority Leader, is as of this writing, in a dead heat with his opponent for the seat he has held since being elected in 1986 (after an earlier 20 year history in Nevada politics). The land-based lobby can make an easy, if not entirely accurate, case that normalized and regulated online gambling would cost the established Nevada casinos a significant amount of revenue. Leaders who don't listen to their constituents, even in hysteria, usually do not hold on to their seats.
Of course a reasonable person can assume that Reid will prevail over the radical stances of the Tea Party candidate, Sharron Angle (abolish the US department of Education, abolish Social Security) but it's understandable that for now he has to tow the line and protect jobs (as perceived). Nevada's largest newspaper, the Las Vegas Review-Journal, has endorsed Angle following their poll that showed them tied at 43% of the vote each. Not a surprise, as they have assailed Reid of late while praising Angle; but it's interesting to note that the LVRJ paper endorsed Reid in 2004.
According to recent news reports on the internet and elsewhere, his office issued the following statement answering an inquiry: "Senator Reid has long had concerns about Internet gaming. He does not support any of the existing bills and he would oppose any proposal that would put jobs in Nevada at risk".
Let's call that dead in the water.
It's very possible that Democrats, the ones who seemed to be the champions of legalizing, taxing, and regulating online gambling, will lose not only their majorities and control, but perhaps much of their bargaining power in the coming election.
So I guess that brings us back to a slightly less sinister version of our first suggestion in May, from our article; Internet Gambling Regulation Bills. But rather than slipping a change into a bill in the dark of night at the end of a session (like our friend Frist did), we might hope our advocates would simply attach a change in the law to a 'must pass' bill like a small business support measure or a jobs bill. Lame ducks (those politicians who, after an election, have nothing to lose because they have not been re-elected) have done stranger things in times of far less quackery.
Let's hope they "get ‘er done" because there is something far more insidious than the UIGEA in the works for online gamblers. In 2007 Congress mandated a report on the Feasibility of a Cross-Border Electronic Funds Transfer Reporting System to stop the funding of enemies. That report confirmed the feasibility of such a System. About a week ago the Financial Crimes Enforcement Network (FinCEN.gov) announced that it had requested publication in the Federal Register of a "notice of proposed rule-making" or (NPRM). These rules will mandate that certain sums of $1,000 or more that move across US borders be reported by certain depository institutions and money services businesses to the FinCEN. The government estimates this rule to affect about 300 depository institutions and 700 money services businesses.
These plans would likely go into effect in 2012 after a public comment period and would lower the required reporting limit of $10,000 to $1,000. There is plenty of anecdotal evidence to suggest that banks are currently flagging transfers of as little as $3,500, so a $1,000 reporting level may just be the end of all wire payments to or from casinos and poker rooms for US Players.
Were these limits to go into effect, and all indications are that they will, players may come to accept such ludicrous weekly payout limits as necessary under the rules of law and not simply the mark of under-capitalized operations or fraud prevention measures for new customers.
Microgaming took the Progressive Jackpots away from US players quite some time ago and it's not a far stretch to imagine Real Time Gaming casinos becoming unwilling to administer the payment of Random Jackpots over long periods of time if these rules as now written come into effect.
It may not seem too hopeful at the moment for online gamblers; the legal framework to regulate it is not likely soon and the US government is finding ways to limit the action further, but politics make strange bedfellows and it is anybody's guess what will come out of this election. It is doubtless at this point that a certain sentiment for 'less government' will find itself some seats in both houses. Those new lawmakers may just be the online gambler's best friend over the next two years as power is brokered and deals are made. It's really anybody's guess!
The Gambling Guru
