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New Hope for U.S. Online Gambling Legalization in 2010

March 25, 2010 (CAP Newswire) – A pair of sudden changes in the U.S. legal landscape could unexpectedly place the online gambling regulation and legalization drive at the top of Congress’ agenda, after years of neglect.

First, in a significant change of policy, the gambling industry in the U.S. has stated that it has reversed course and now endorses the legalization of online gambling at a federal level.

The AGA (American Gaming Association) was previously neutral to Internet gambling, resisting endorsing it out of fear that it would create harmful competition with the land-based casinos that the AGA represents. Now, however, the group (like so many others) has seemingly come to the realization that online gambling regulation would present far more revenue opportunities than it would restrict.

“In a new policy statement, the American Gaming Association said it was open to the concept of legalized Internet gaming, as long as a regulatory structure was in place to protect consumers and the game’s integrity,” writes Howard Stutz at the Las Vegas Review-Journal.

Some experts are speculating that this development alone could ensure that online gambling becomes a priority for some of the U.S.’ leading legislators. “Being in favor of legalizing Internet Gambling is important, because the Majority Leader of the U.S. Senate, Harry Reid from Nevada, is facing an extremely tough reelection bid in November,” writes I. Nelson Rose at the Gerson Lehrman Consulting Group. “This greatly increases the chances a bill will be passed this year, which would have a major impact on companies like IGT, PartyGaming and Harrah’s.”

“But the organization, which represents the bulk of the nation’s casino operators and slot machine manufacturers, has not taken a stance on any of the bills currently floating through Congress that could legalize all or some forms of Internet gaming, estimated to be a $26 billion a year industry,” Howard Stutz cautions.

Some land-based casinos, like Harrah’s, already endorse the idea of Internet gambling and are already seeking to enter the market if regulation should occur in the U.S. In the wake of Las Vegas’ fading revenues, it seems that other land-based casinos are starting to follow in Harrah’s footsteps.

That’s not all. With the potential resolution of the health care debate in the U.S. Congress, American lawmakers may suddenly be relieved of the most debated issue of the past few years, giving them the freedom to focus on other issues. “The fact that health care reform has passed may now free up time for legislators to continue examining the issue, and thus push regulation closer to passing, rather than keeping the current bills, HR 2267 and the mysterious Bipartisan Tax Fairness and Simplification Act, stuck in committees, or even in earlier parts of the process,” writes Glen Farmer at

Previous analysis that no immediate action was expected on Barney Frank’s online gambling legalization bill (HR 2267, the Internet Gambling Regulation, Consumer Protection, and Enforcement Act), and no further delays were expected for the UIGEA (the Unlawful Internet Gambling Enforcement Act of 2006, scheduled to go into full effect on June 1), could be thrown out the window with this news. 

Some news sources had previously credited UIGEA opponent and Arizona Senator Jon Kyl’s recent congressional dramatics with ensuring that the UIGEA will definitely go into effect in June.

“It appears the power play by Sen. Jon Kyl (R-Ariz.) in blocking President Obama’s Treasury nominees from taking office worked, strong-arming Treasury Secretary Timothy Geithner,” writes Matthew Kredell at

“Geithner promised he won’t delay the bill again because Kyl was holding up all the nominees,” Barney Frank apparently told PokerNews. “It’s fine with me. I think it’s frankly so dumb and oppressive that it will create support to repeal the bill. I think, once it goes into effect, banks are going to raise hell and all the bankers will go to the Senate to complain.”

“The Treasury, Federal Reserve, Congress and the banking community agree that the proposed UIGEA regulations are overly broad and lack the key definition of ‘unlawful Internet gambling,'” PPA executive director John Pappas said in a statement illustrating that the organization isn’t about to back down in its opposition to the online gambling ban. “This was the case when the regulations were delayed in November and it remains the case today. Enacting the final rule on June 1st without this clarification would be a huge mistake and will add another layer of confusion upon an already complex matter.”

“We’re still looking to file another petition, not necessarily for a delay but an exemption of certain activities under the UIGEA,” PPA executive director John Pappas told in another article.