Bill to legalize online gambling disclosed

Financial Services Committee Chairman Barney Frank (D-MA) introduced new legislation designed to establish a regulatory framework for online gambling in the United States.

The Internet Gambling Regulation, Consumer Protection, and Enforcement Act as it is called would create a federal regulatory and enforcement framework allowing online gambling operators to obtain licenses to accept wages from American residents.

If passed, this bill will overturn the controversial Unlawful Internet Gambling Enforcement Act (UIGEA) passed in 2006, which outlawed financial transactions with online gambling companies and caused billions in damages to numerous international companies forced to withdraw from the US market.

The goal of the bill is to establish a strict federal regulatory framework intended to control gambling in the United States by protecting underage and otherwise vulnerable individuals, ensuring that the games are fair, addressing law enforcement's concerns and enforcing limitations on the activity established by the states and Indian tribes.

The bill calls on the Treasury Department to regulate the industry. It would give individual states and Native American tribes the right to impose further restrictions on Internet gambling or even to outright ban it.

All operators will need to pass a background check in order to be granted a five-year license. They would have to conduct self-regulating activities, such as making sure all players are of legal age, collecting customer taxes, paying their own taxes, safeguarding against financial crime and problem gamblers, implementing privacy safeguards as well as any other requirements the Treasury Department decides to ask for.

In addition, each licensee would be responsible for providing upon request, full disclosure of the names and addresses of licensees, the gross wins and losses by each person wagering, the total of "net internet gambling winnings," the amount of tax paid and annual account balances.

The Poker Players Alliance, the poker advocacy group applauded the proposed legislation. "Online poker is a legal, thriving industry and poker players deserve the consumer protections and the freedom to play that are provided for in this legislation," PPA Chairman Alfonse D'Amato said. Many poker pros suuport the PPA, including Annie Duke.

If enacted, this bill will certainly promote a much more pleasant climate for online poker players, websites and poker rooms, which all had to struggle to defend and maintain the right to their favorite pastime.

As a recent study from PricewaterhouseCoopers shows that online gambling will generate as much as $52 billion in revenue in the U.S. over the next ten years if the ban on Internet gambling were lifted, this bill could supply President Obama's administration with a much needed tax revenue stream.

Recently the Poker players Alliance succeeded in its demand to the Obama's administration to delay UIEGA by 6 months, showing that the wind has changed direction with the new of President.

For more legal opinions about gambling laws and reforms, check Professor I. Nelson Rose's website Gambling and the Law which contains the latest updates.