Another Internet gambling prohibition bill is making the rounds. The House Financial Services Committee on Wednesday voted 34-18 in favor of a bill that would ban the use of credit cards for online wagering.


This is the second time in less than a month that an online gambling prohibition bill has been on the House’s agenda. Late last month, Rep. James Leach of Iowa tried to attach an Internet gambling provision to the anti-terrorist bill introduced in the wake of the September 11 attacks.


That provision was removed at the last minute, but many industry insiders did not expect it to disappear. And this latest development seems to indicate that it didn’t go very far at all.


The current bill, known as the “Unlawful Internet Gambling Funding Prohibition Act of 2001” (HR 556) was introduced by Leach in February 2001. Leach has argued that Internet gambling is “the single easiest way to launder money,” and has been pushing hard to make it illegal.


Leach’s bill prohibits the use of credit cards, checks, and electronic fund transfers to in online wagering, and it would hold banks responsible if they knowingly allow violations of this legislation.


The new version of the bill does, however, include an amendment that excuses Internet service providers (ISPs) and telecommunications companies from any wrongdoing for facilitating online wagering traffic. Another major carve-out in the bill is games of skill, which include fantasy sports leagues and ‘educational’ games.


Leach has managed to secure Online Casino Malaysia considerable support for his bill over the past year. House Financial Services Chairman Michael G. Oxley (R-Ohio) commented in a prepared statement that the proposed legislation “will protect our financial system and give financial criminals one less place to hide.”


As the vote indicates, however, support for the bill was hardly unanimous. Rep. Barney Frank of Massachusetts suggested that it is not the federal government’s responsibility to police gambling activity or oversee the way in which people spend their money.


Financial institutions aren’t very happy about the proposed legislation, either, because much of the responsibility for policing this bill falls squarely on their shoulders. And some industry experts don’t think that is a reasonable expectation.


Richard Hunter, managing vice president of business analysts Gartner Inc., noted that it would be possible for banks to screen known gambling sites, but that it is quite easy for these companies to disguise a casinos’ identity by using a different corporate name.


He also suggested that the proposed legislation would likely not be very effective at stopping money laundering, and that the U.S. federal government may actually be more concerned about lost revenue and drains on productivity rather than reducing funding for terrorist organizations.


The current version of the bill includes civil and criminal penalties for online gambling, including fines and prison terms of up to five years. Federal and state attorneys general would also be able to launch lawsuits against online gambling providers.


In related news, Rep. Bob Goodlatte reportedly plans on November 1 to reintroduce his anti-gambling bill. Goodlatte’s camp has said that this version of the bill, which failed to pass last year, has been modified to “keep pace with new technologies.” No further information on the revisions was offered.


Stay tuned to for details on both pieces of legislation as it becomes available.


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