US Congress Discussing Ban on Internet Gambling

What will SL do?

http://www.cnn.com/2006/POLITICS/07/11/internet.gambling.ap/index.html

Online gambling faces full House

Congress debating tougher Internet gambling bill

Tuesday, July 11, 2006; Posted: 9:33 a.m. EDT (13:33 GMT)


WASHINGTON (AP) -- Congress may deliver a blow to gamblers who prefer going online to going to Las Vegas.

The House is debating a bill that would clarify existing law by spelling out that Internet gambling is illegal. The legislation would forbid credit cards and other forms of payment from being used to settle online wagers and would allow authorities to work with Internet providers to block access to gambling Web sites.

Critics say policing the Internet is impossible and that it would be better to regulate the $12 billion industry and collect taxes on it.

The American Gaming Association, the industry's largest lobby, has opposed online gambling in the past but recently backed a study of the feasibility of regulating it.

The Internet gambling industry is headquartered almost entirely outside the United States, though about half its customers live in the U.S.

The House is scheduled to vote Tuesday on the bill sponsored by Reps. Bob Goodlatte, R-Virginia., and Jim Leach, R-Iowa. Some of the debate is expected to focus on whether the bill truly amounts to a ban.

Critics point to exemptions that they say would allow online lotteries and Internet betting on horse racing to flourish while cracking down on other kinds of sports betting, casino games and card games like poker.

"Regardless of your position on the issue, there is no reason for Congress to pick and choose which types of gaming should be exempted from what is being described as a ban on Internet gaming," Rep. Shelley Berkley, D-Nevada, wrote in a letter to colleagues Monday.

She is expected to offer an amendment that would strip out exemptions in the bill for state lotteries and the horse industry.

Congress has considered similar bills several times. In 2000, disgraced lobbyist Jack Ambramoff led a fierce campaign against it on behalf of an online lottery company. Online lotteries are allowed in the latest bill at the behest of states.

Under the provision that relates to horse racing, betting operators would not be prohibited from any activity allowed under the Interstate Horseracing Act. That law was written in the 1970s to set up rules for interstate betting on racing. The industry successfully lobbied for legislation several years ago to clarify that horse racing over the Internet is allowed.

Greg Avioli, chief executive officer of the National Thoroughbred Racing Association, said the mention of horse racing in the bill is "a recognition of existing federal law," not a new carve-out.

Avioli said the racing industry has a strong future in the digital age and acknowledged that the bill would send Internet gamblers to racing sites. "They'd return to the one place they can bet legally," he said.

The Justice Department has taken a different view on the legality of Internet betting on horse races. In a World Trade Organization case involving Antigua, the department said online betting on horse racing remains illegal under the 1961 Wire Act despite the existence of the more recently passed, and updated, Interstate Horseracing Act.

The department hasn't actively enforced its stance, but observers say it is possible that the agency and the racing industry could face off in court in the future.

Like the racing industry, professional sports leagues also like the bill. They argue that Web wagering could hurt the integrity of their sports.

Many conservatives back the bill on moral grounds, arguing that Internet betting is harmful to society.

John Kindt, a business professor at the University of Illinois at Urbana-Champaign who has studied the issue, calls the Internet "the crack cocaine" of gambling.

"There are no needle marks. There's no alcohol on the breath. You just click the mouse and lose your house," he said.

Sen. Jon Kyl, R-Arizona, is leading support for the ban in the Senate. The issue has not been debated in that chamber this year, and the measure hasn't been identified by Senate leaders as a top priority.

If the horse provision were stricken from the bill, there's a good chance the measure would run into objections from Senate Majority Whip Mitch McConnell, R-Kentucky, and others from racing states.

Copyright 2006 The Associated Press. All rights reserved.This material may not be published, broadcast, rewritten, or redistributed.

For one it would be a big mistake for the simple fact that the EU want most of the hubs out of the us... This would just give them another reason to point at us for

Be greatly improved?

Lewis

It's stupid and will never happen. How will they deal with companies located in other countries or servers that host the games elsewhere?

Congress wastes a lot of time grandstanding over issues they aren't going to do a damn thing about. In fact that describes Congress pretty acurately on any given day.

They'll dangle things like WTO membership in front of their ruling governments, or pressure the governments into raiding them without really, really good cause.

No problem, those web sites would be blocked against access from American ISP's. It will give some civil service people something to do. They could also issue fines and perhaps give jail time for those that do. I dont see any technicial problem doing this. In fact it will protect the real life casinos in America and force the customers to go there. Some Congress people must be getting some good reelection "contributions" to propose something like this.

Not over this, lol.

There are too many gambling lobbyists right here in the USA, anyways. Every once and a while... usually around... election time, Congress gets it's panties in a wad over some new Internet Evil. And then shoots down the legislation but many can say they voted for it in November.

The gambling lobbyists in the US are *losing* money over internet gambling; they operate regulated, taxed gambling businesses in the US. So, they're some of the ones pushing for this law.

There's billions of dollars in tax money at stake too, so that's motivation.

You don't see a problem with ISP's needing to hunt down every single offshore website that offers gambling and blocking it?

Real life off-track betting, located in the US, doesn't want this. At all.

It's good to know Big Brother is still working to keep an eye on every little thing we presume to do with our free time.

America, Land of the Free*

* ... to do exactly as you're told

I'm talking about the ponies, Hiro. They make lots of money with off-track, online betting.

Now, if the Casino interests are really losing serious money over this, it may be passed, if they throw enough money at their favorite congressman. But I still say it's unenforcable unless they start dragging the credit card companies into it and they will not be happy about that, either. And they have far more clout than casinos. (See: Bankruptcy Bill)

While I agree this is legally a joke and unenforcable, the original question Hiro posed concerned its effects on SL.

I would think none -- you could lose hundreds of $L in SL and it would still only cost you $1 or 2... dollars you already paid for or earned inside the virtual world. And if we carry the analogy over to the closest genre to SL (video games), I remember a number of MMRPGs I've played where gambling was part of the game. The real sums of money are insignificant and the method of payment doesn't fit into their real targets in online casinos.

Going back to SL, does anyone know offhand how much of the inworld economy the casinos suck up? I'm curious. I've never used them except when I first came into SL, once, mainly to see if they were for real, heh.

So this will be thrown up to the Senate, who are going to hear from the Banks about this, like I said, that is where the real clout is (it excludes the ponies, which was the only way it would get passed):



(I loves me some Barney Frank)

They passed it (317-93), however I believe the senate has to pass it (or something similar) as well. From there, it'll get merged and onto the president, who never vetos anything these days..

to the point of the question. If this is indeed passed by congress and the senate and then signed by the president and LL feels that there is grounds for the government to question the gambling in SL you can be sure that will mark the end of gambling in SL.
this is if the lawyers believe the government could have a case and from what I heard from Phillip in a recent podcast interview they have some dame good lawyers on the payroll.
basically it will come down to weather gambling in SL is considered real gambling.

---Crucial

The house passed the legislation, but it does not make internet gambling illegal. The WTO has already decided that the United States Congress has no right to make non-U.S.-based internet gambling illegal.

So, the United States Congress intends to prevent U.S.-based financial institutions from transferring money to the non-U.S. gambling operators. In other words, you can still gamble online, but your C.C. company won't pay your bill... therefore, the online gambling operator won't accept your C.C., ad therefore, you won't be able to gamble online.

Some news articles mention that all forms of electronic payment to internet gambling operators will be prevented... but the AP article only mentions credit cards. If it comes down to banning all forms of electronic payment, then paypal and wire transfers would also be illegal and blocked by those companies. It's at that point that SL would be in danger of losing its ability to host gambling within the virtual world (a U.S. Attorney could very easily demonstrate the electronic method of converting L$ to US$.)

As for horse and lottery gambling, those are exceptions to the legislation, and as such, are not affected.

well sl is usa based.

Will it make the end of one of the plagues of sl? we will see...

Note to poster... the US doesn't care what any world body says it can or cannot do. It will do what it wants.

Thank you Cowhand, I was about to say this Myself.

Congress Loves doing things like this, it appears to Justify their paychecks while actually Not accomplishing anything what-so-ever.

Your Tax Dollars At "Work"?

Angel.

China has developed a very good model for managing this sort of operation.

Yes, it's Called a Totalitarian society, and is simply acheived by the removal of everyones basic human rights.

Piece-o-cake.

Angel.

Gambling in SL is already illegal under Californian state law.

It's illegal for anybody in the state of California to own - or house - any kind of machine that they know is being used for gambling (even if it's by third parties) without obtaining a license for that machine.

Do LL know gambling is taking place on their servers?

I think they'd have a *very* hard time arguing that they don't know about the existance of casinos in SL.

Are the SL servers legally licensed for gambling?

Not a chance.

So this thread is kind of moot... the gambling that takes place in SL is already illegal and (iirc - it's a few months since I researched the details) could land the operators 18 months in jail.

I was listening to news and it said this applied only if an USD transaction took place (they were talking about CC's/checks etc). In this cause, would gambling with L$ be something we need to be worried about?

I believe the loophole that LL and SL gets to use is the fact that the L$ or any other content is not redeemable for monetary value directly from Linden Lab.