Posted on Wed, May. 07, 2003

Internet gambling tougher under bill
The House panel voted to prohibit use of credit cards, checks and fund transfers for online bets.
By Laurence Arnold
Associated Press

WASHINGTON - A House subcommittee voted yesterday to make it harder for Americans to gamble on the Internet, choosing not to consider an alternative proposal that could lead to states' legalizing and taxing online casinos.

Democrats on the House Judiciary subcommittee on crime said they would raise that alternative when the full committee considered the bill.

By a voice vote, the subcommittee approved legislation that would prohibit the use of credit cards, checks and electronic fund transfers to pay for online betting transactions.

The bill, sponsored by Republican Rep. Jim Leach of Iowa, previously passed the House Financial Services Committee. The full House approved a similar measure in the last Congress, but it died in the Senate.

Large majorities in the House and the Senate supported banning or restricting Internet gambling in a series of votes since 1998. But disputes over how to define illegal gambling, and how to enforce a ban, have prevented Congress from agreeing on any one bill to send to the White House.

That record prompted some in Congress to propose a different route.

Rep. John Conyers (D., Mich.) and a small bipartisan group of lawmakers this year proposed creating a commission to explore legalizing Internet gambling in states interested in licensing, overseeing and collecting taxes from the growing industry.

Some Democrats on the crime subcommittee said they were disappointed that the panel did not take up that legislation as well. Rep. Bobby Scott (D., Va.) said he would propose regulating online gambling when the full committee had taken up the Leach bill.

Scott said Leach's bill would force Internet gamblers to become more creative with their financing, but it would not stop Internet gambling.

Rep. Bob Goodlatte (R., Va.) countered that Congress must do what it could to disrupt online casinos, which he said catered to children and addicted gamblers.

"These facilities are open 24 hours a day, seven days a week, all available in a person's home," he said.

The General Accounting Office, in a report last year, called Internet gambling "a fast-growing industry" with estimated 2003 revenue of more than $4 billion.

Virtually all Internet-gambling operations - the General Accounting Office estimates there are 1,800 - are based outside the United States, posing a problem for enforcement.

In the Senate, Arizona Republican Jon Kyl has proposed legislation similar to the Leach bill. The chairman of the Senate Banking Committee, Republican Sen. Richard Shelby of Alabama, endorsed the bill at a hearing in March.